The Fed's Dance Card is Full (But Bitcoin Didn't Get the Memo)

A memo from the trading floor, where reality meets expectation in brutal fashion

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TO: The Treasury Secretary
FROM: Anonymous Floor Trader (who's definitely not writing this on company time)
RE: Why we're all pretending to be surprised by what's happening

Jerome, old buddy. We need to talk.

I've been watching this circus from my corner of chaos for long enough to know when the script is getting stale. The market has your Wednesday rate cut priced in at 80% certainty. Markets see a more than 80% chance of a Fed rate cut in September, but here's the thing about certainty in our business — it's the fastest way to lose money.

Bitcoin just did something interesting. While everyone was holding their breath for your announcement, Bitcoin (BTC) rising 1.33% to surge above $116,000 this morning. Not exactly fireworks, but when you're dealing with an asset that was flirting with $124k in August and has been sliding ever since, any green is worth noting.

Here's what's really grinding my gears: the crypto crowd is acting like your 25 basis point cut — if it happens — is going to unleash some kind of liquidity tsunami. Bitcoin ETF Inflows Hit US$2.3 Billion as Traders Bet on Fed Easing. Two point three billion. Into ETFs. For an asset that was supposedly built to escape the traditional financial system.

The irony would be delicious if it weren't so expensive.

Bitcoin slipped 0.07%, holding steady near $115,000, while Ethereum fell 1.93% to around $4,500 yesterday, and the GameFi tokens are bleeding harder than my P&L after the last FOMC meeting. GALA and FORM both down over 5%. When gaming tokens are leading the decline, you know we're in for some interesting times.

But here's the real kicker — two of the policymakers stand in limbo – uncertain if they will vote at all – with little more than 48 hours before the announcement. Trump's been busy reshaping the Fed, and we've got policymakers who might not even get to vote on what could be the most consequential rate decision of the year.

The mortgage market is already pricing in relief. Thirty-year mortgage rates fell to 6.38%, down from the 7%+ nightmare we were living through earlier this year. Real estate investors are getting frisky again, which means we're about to see another round of "this time is different" thinking.

Meanwhile, Binance Coin just hit a record high today while Bitcoin was doing its modest victory lap. sectoral gains were strong as CeFi jumped 3.16%, Binance Coin (BNB) hit a record. When centralized exchange tokens are outperforming the king of crypto, something's off in the kingdom.

The smart money — what's left of it — is positioning for volatility regardless of your decision. Cut rates, and everyone who bought the rumor might sell the news. Don't cut, and the leveraged crypto positions that have been accumulating all month are going to unwind faster than a cheap suit.

I've been through enough Fed cycles to know that the real action starts after the decision, not before. The market might be pricing in 80% odds of a cut, but the odds may be closer to 50-50 due to strong economic indicators. GDP growth is solid, financial conditions are stable, and market volatility is low. All reasons for you to keep your powder dry.

But powder is expensive these days, and patience is a luxury few can afford when Bitcoin miners are burning electricity at today's prices and ETH validators are watching their yields compress.

The crypto market has maintained its bullish trend through September 2025, as the global political situation continues to stabilize and institutional investment increases. Translation: the suits have arrived, and they brought their risk management departments with them.

Your move, Jerome. Just remember — whatever you decide Wednesday, the market will find a way to make it wrong by Thursday.

Yours in controlled chaos,
The Floor

P.S. — Next time you want to move markets, maybe give us more than 48 hours' notice on the personnel changes. Some of us have positions to adjust.

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This newsletter is written by someone who has definitely never lost money betting against the Fed. Subscribe for more completely accurate market predictions and zero accountability for trading losses.