Morgan Stanley Prediction: 7x Fed Rate Cuts, Will Crypto Assets Surge?

Jakarta, Pintu News – Morgan Stanley recently issued a prediction that the Federal Reserve (Fed) will cut interest rates seven times until the end of 2026, with the benchmark interest rate falling to between 2.5% and 2.75%. This prediction is expected to not only impact traditional markets but also crypto assets such as Bitcoin (BTC).

Check out the full analysis in this article!

Delayed Interest Rate Cut

Initially, many expected the Fed to start cutting interest rates as early as this summer. However, the plan has now been postponed. According to Morgan Stanley, the first cut is expected to occur in March 2026.

Inflation associated with the latest tariff announcement is the main reason for this delay. Michael Gapen, Lead US Economist at Morgan Stanley, explained that tariff-induced inflation will make the Fed delay the rate cut.

Also read: CBOE’s New Move: PENGU Canary ETF Officially Filed with SEC

Impact on Crypto Assets and Risk Assets

When interest rates fall, borrowing costs become cheaper and liquidity increases. Investors tend to move away from low-yielding assets in search of higher yields.

Under these conditions, cryptocurrencies are often an option. The historical low interest rate environment has encouraged growth in riskier markets. After the 2008 financial crisis, low interest rates played a key role in driving investment into new asset classes, including Bitcoin (BTC) which emerged during the cycle.

Read also: SoFi Re-Launches Crypto Trading Service, Check out the Innovation!

Bitcoin’s Current Position

Currently, Bitcoin (BTC) is trading at $106,476 with a market capitalization of $2.12 trillion and a 24-hour gain of 0.70%. Bitcoin (BTC) dominates 64.57% of the entire crypto market.

Although the current price action looks normal, sentiment is gradually starting to build. With interest rate cuts on the horizon and Bitcoin ETFs continuing to attract attention, many see this as a key setup for the next phase of adoption.

Conclusion

While it’s still early days, if the Fed follows the path Morgan Stanley has set, it could reignite momentum in the crypto market. Not just for Bitcoin (BTC), but also for Ethereum (ETH), ETFs, and even new altcoins gaining traction in global hubs like the Cayman Islands.

Seven rate cuts in two years is a big move, and in crypto, big moves tend to bring big reactions. Right now, it’s still a waiting game, but smart investors know that change may be coming and they’re already preparing for what comes next.

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*Disclaimer

This content aims to enrich readers’ information. Pintu collects this information from various relevant sources and is not influenced by outside parties. Note that an asset’s past performance does not determine its projected future performance. Crypto trading activities have high risk and volatility, always do your own research and use cold cash before investing. All activities of buying and selling bitcoin and other crypto asset investments are the responsibility of the reader.

Reference

• Coinpedia. Morgan Stanley Predicts 7 Fed Rate Cuts by 2026, Will Crypto Rally Again?. Accessed on June 26, 2025
• Morgan Stanley. Tariffs Could Jeopardize Growth Outlook and Rate Cuts. Accessed June 26, 2025
• Featured Image: Cryptoslate