Bitcoin has surged past the $90,000 level today, marking a fresh milestone for the world’s largest cryptocurrency as prediction markets show overwhelming confidence that the Federal Reserve will keep interest rates unchanged in today’s policy meeting.
In the past 24 hours, the crypto king saw its price rise over 2% to a new multi-month high, data from CoinCodex shows.
Market Confidence Builds Ahead of Fed Decision
BTC’s climb to above the psychological $90K mark comes amid strong optimism that the Fed will decide to keep interest rates unchanged.
In a contract asking what the Fed’s decision will be in January, traders on Polymarket have placed over 99% odds that the reserve bank will choose to keep rates steady during the policy meeting scheduled for later today.
Meanwhile, traders have placed less than 1% odds that the Fed will either cut rates by 25 basis points, cut rates by 50 basis points, or increase rates by 25 basis points.
A Fed pause is typically viewed as supportive for Bitcoin, which tends to benefit from improved liquidity conditions and stronger demand for alternative or non-correlated assets.
Even without imminent easing, the absence of new hikes provides a clearer macro backdrop for institutional allocators who have steadily increased exposure to digital assets throughout 2025 and into early 2026.
Odds that the Fed won’t change rates in today’s meeting are just as strong on the CME FedWatch tool. Here, analysts see a 97% chance that rates will stay the same between the range 3.50%-3.75%.
A Macro Backdrop Filled With Quiet Stress Signals
While markets appear confident heading into the Fed’s policy decision, not everyone sees the current calm as reassuring. Some analysts argue that beneath the surface, stress fractures are beginning to form in the global financial system. One of the loudest warnings is coming from Arthur Hayes.
According to Hayes, the United States cannot afford to let Japan’s financial structure crack. Japanese institutions hold roughly $2.4 trillion in foreign bonds, much of it U.S. Treasuries. If JGB yields become attractive enough to draw domestic capital back home, he warned that “Japan Inc.” could become a large net seller of U.S. debt. This would happen right at a moment when America is already grappling with soaring deficits and rising long-term yields.
Allowing that cycle to unfold would lift Treasury rates, expand federal interest costs, and threaten U.S. economic competitiveness.
Hayes believes the U.S. Treasury and Federal Reserve are preparing to intervene quietly. He outlined a mechanism in which the New York Fed effectively “prints” reserves, channels them through primary dealers to buy yen, and uses those yen to accumulate JGBs — all while expanding the Fed’s balance sheet under the line item Foreign Currency Denominated Assets. Crucially, Hayes argued that officials can classify this as currency stabilization rather than quantitative easing, even though it would increase global liquidity.
He also pointed to signals he believes foreshadow intervention, such as reported phone calls from the NY Fed to major dealers about yen and JGB pricing. In Hayes’ view, this is intentional telegraphing designed to let markets front-run any policy move, reducing the amount of intervention required once it begins.
If such a U.S.–Japan liquidity pipeline forms, Hayes says the consequences could be far-reaching: a stronger yen to ease Japan’s inflation pressure, lower JGB yields to keep domestic investors from dumping Treasuries, and a softer dollar that reshapes global trade dynamics.
Most importantly for crypto markets, an expanding Fed balance sheet historically translates into fresh liquidity for risk assets — and Bitcoin, he argues, tends to “mechanically levitate” when global money supplies grow.
