What price will bitcoin be by Christmas?

The Federal Reserve’s first interest rate cut in nine months has set the stage for what could be a pivotal fourth quarter for bitcoin (BTC-USD). With policymakers projecting two additional cuts by year-end, investors are asking the seasonal question: where will bitcoin’s (BTC-USD) price land by Christmas?

The US central bank trimmed its benchmark interest rate by 25 basis points this week, the first cut since December 2024, bringing the federal funds target range down to 4.00%–4.25%.

Fed chair Jerome Powell described the move as a “risk management” step, citing rising risks to employment alongside persistent inflation pressures. The Fed's updated dot plot points to two additional quarter-point cuts by year-end, which would put the policy rate in the 3.50%–3.75% range heading into 2026.

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The news jolted bitcoin (BTC-USD) prices above $117,000 (£85,8400). Analysts now see a tug-of-war between near-term volatility and a supportive backdrop of easing monetary policy, strong spot bitcoin exchange-traded fund (ETF) demand, and ongoing institutional adoption.

Ryan Lee, chief analyst at crypto exchange Bitget, told Yahoo Finance UK that the Fed’s measured stance could spark short-term turbulence before a renewed push higher.

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“The Fed’s 25-basis-point rate cut, the first in nine months, sent bitcoin (BTC-USD) price soaring briefly above $117,000, reflecting heightened liquidity expectations. Yet the median FOMC projection of just 50 bps in total cuts this year tempers the optimism, diverging from market hopes of 68 bps. Notably, it introduces a risk of near-term volatility as traders change their approach to the market,” Lee said.

CCC - CoinMarketCap•USD

(BTC-USD)

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117,001.71

-489.78

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As of 5:12:00 AM UTC. Market Open. Advanced Chart

He added that crypto markets often dip before resuming their upward trajectory after Fed actions. “Historically, crypto has dipped 5 to 8% following rate cuts before resuming its upward path, suggesting a potential ‘sell the news’ phase in the days ahead.”

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Still, Lee believes the macro environment supports further gains. “Lower yields on money-market funds redirect capital toward alternatives like digital assets, fueling bitcoin’s (BTC-USD) role as a risk-on hedge,” he noted, pointing out the $7.2tn currently sitting in cash-like instruments.

His year-end outlook? “In the near term, bitcoin (BTC-USD) consolidates before targeting $123,000 to $150,000 if subsequent cuts materialise,” he said.

Bitcoin's year-end trajectory could be bullish

Enmanuel Cardozo, market analyst at Brickken, echoed that while volatility remains a risk, the direction of travel favours bulls.

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“I see a constructive setup into Christmas. The Fed just delivered its first 25 bp cut of the year and signaled, in its projections, two more cuts by December. That path usually softens the dollar and loosens financial conditions, which favours high-beta assets like bitcoin (BTC-USD),” Cardozo told Yahoo Finance UK.

Cardozo pinpointed the $118,000 to $120,000 zone as key resistance in the near term, but expects further gains if ETF demand remains strong. “My base case is a stair-step move rather than a straight line: a break of $120,000, consolidation, then a run toward price discovery zone into year-end, with a reasonable upside if flows pick up steam,” he said.

He cautioned that “the risk is less about the policy direction and more about positioning and liquidity pockets on the way up,” but added that the balance of probabilities leans bullish: “I think the probabilities favour bitcoin (BTC-USD) closing the year above the $120,000 zone than the low $100,000 zone. All while acknowledging that it is still plausible to reach higher near $150,000 if ETF inflows spike again.”

ETF flows could hold the key

Bitfinex analysts highlighted the structural bid from US spot bitcoin ETFs, which have seen massive inflows since launch.

“In the run-up to the decision, US spot BTC and ETH ETFs pulled in over $600m in a single day, with total US spot BTC ETF AUM at roughly $151.7bn (about 6.6% of bitcoin market cap). Post-decision, we saw the first small wobble, about $51.3m net outflow on the day after as investors digested the Fed’s cautious language; price held near $117,000, underscoring that even modest flow setbacks are being absorbed quickly in this regime,” Bitfinex analysts said.

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The Bitfinex analyst base case heading into Christmas: “With three total 2025 cuts (yesterday plus two more by December) and steady ETF net inflows, bitcoin (BTC-USD) tracks toward $125,000–$135,000 by year-end, with upside skew if flow velocity re-accelerates and the dollar softens.”

But they also flagged risks: “If inflation or growth data slows the Fed’s follow-through (or ETF flows stall), bitcoin (BTC-USD) likely consolidates in a $110,000–$115,000 band into year-end; that floor is reinforced by ETF AUM depth and ongoing institutional participation.”

Bitfinex analysts said the pivot has shifted crypto’s trading drivers. “The policy pivot has moved us from ‘event-driven rallies’ to a flows-and-liquidity tape, watch the daily ETF prints, real yields, and DXY; if they lean dovish, the path of least resistance remains higher.”

The Christmas bitcoin range

So, where does that leave bitcoin (BTC-USD) by December 25th? The consensus among analysts points to a supportive environment heading into the holidays, but with plenty of room for volatility along the way.

Ryan Lee of Bitget sees bitcoin (BTC-USD) consolidating before targeting between $123,000 and $150,000 if the Fed follows through with additional cuts.

Enmanuel Cardozo at Brickken believes the probabilities favour bitcoin (BTC-USD) closing the year above the $120,000 mark rather than slipping back into the low $100,000s, with the possibility of pushing toward $150,000 if ETF inflows accelerate.

Bitfinex analysts, meanwhile, forecast a base case of $125,000 to $135,000 by year-end, with a downside scenario of $110,000 to $115,000 should macro conditions or ETF flows falter.

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