Bitcoin may rebound if Fed pauses rate hikes, says Grayscale
Bitcoin could close its recent performance gap with US equities if the Federal Reserve refrains from raising interest rates, according to digital asset manager Grayscale Investments.
23rd June 2026 – (New York) Bitcoin could close its recent performance gap with US equities if the Federal Reserve refrains from raising interest rates, according to digital asset manager Grayscale Investments. In a research note dated 22nd June, the firm linked bitcoin’s relative weakness to shifting expectations around U. S. monetary policy. While American equities have advanced approximately 9 per cent since the outbreak of the Iran conflict in late February, bitcoin has edged down 1 per cent over the same period. Gold has fared even worse, retreating by about 20 per cent, marking one of the widest divergences among major macro assets. Grayscale’s head of research, Zach Pandl, said the company’s central expectation is that the Fed will hold rates steady. Under that scenario, he suggested bitcoin prices could begin to align more closely with gains seen in the stock market. Markets have increasingly priced in tighter financial conditions. Since late February, one‑year expectations for US interest rates have risen by roughly 60 basis points. Around half of Federal Reserve policymakers have signalled that rate increases could be appropriate in 2026. At its 17 June meeting, the Federal Open Market Committee voted unanimously to maintain the federal funds rate within a target range of 3. 5 to 3. 75 per cent, marking Kevin Warsh’s first policy decision as Fed chair. Policymakers reiterated that inflation remains above the central bank’s 2 per cent objective, with energy costs contributing to ongoing price pressures. The next rate‑setting meeting is scheduled for 28–29 July 2026. Beyond the United States, other major central banks have already tightened policy. The European Central Bank has raised borrowing costs in response to persistent inflation, reinforcing the global shift towards more restrictive monetary settings. Grayscale noted that interest‑rate expectations are especially significant for assets that do not produce income. When real yields rise, investors can secure higher returns from cash and fixed‑income instruments, thereby increasing the opportunity cost of holding alternatives such as bitcoin or gold. However, the firm argued that bitcoin occupies a hybrid role within portfolios. It characterised the cryptocurrency as a scarce digital commodity capable of acting as a long‑term store of value, while also offering exposure to the expansion of blockchain technology and the wider crypto sector. Pandl said this places bitcoin somewhere between traditional monetary hedges like gold and growth‑oriented equities tied to technological innovation. On that basis, he suggested the asset may serve as a portfolio diversifier and appears attractively valued at current levels. According to Grayscale, recent underperformance in both bitcoin and gold reflects the repricing of rate expectations, whereas equities have continued to benefit from sustained investment in artificial intelligence infrastructure and development.