Trader Cautions Crypto Investors Ahead of FOMC Meeting

In Brief

• A well-known crypto analyst has warned of market uncertainty ahead of the FOMC meeting.
• Anticipation of interest-rate decisions often pushes traders out of risk assets to avoid volatility.
• Despite expectations for rate cut, recent history shows that crypto markets don’t always react predictably.

Shedrach Kongvong 2025-12-05

As the date for the next Federal Open Market Committee (FOMC) approaches, a famous crypto trader Michaël van de Poppe has called for caution. He warned that uncertainty rises as the date gets closer, hence the need for traders and investors to be careful.

Poppe in an X post on 5 December said the FOMC meeting in itself calls for caution every time it holds, and this time is not an exception. He also added that investors tend to remove their money from risk assets like Bitcoin and altcoins to prevent losses should the Fed give an unfavorable verdict.

Be reminded that we're going to have a FOMC meeting next week.

That event, in itself, provides a cautious approaches on almost all occassions.#Bitcoin and #Altcoin markets tend to go risk-off prior to the event in anticipation of a potential hawkish tone of Powell.

Wouldn't…

— Michaël van de Poppe (@CryptoMichNL) December 5, 2025

FOMC Can be Harmful

The FOMC meeting is the monetary policymaking body of the U.S. Federal Reserve System, held eight times a year. During the meeting, U.S. monetary policies are made, particularly the target federal funds rate. Because the funds rate affects other aspects of the economy such as interest rates, inflation, and employment, it determines how the crypto market reacts too.

With higher rates announced, investors tend to withdraw their funds from risk assets like Bitcoin and altcoins, but with lower rates, investors are more open to making quick profit from such high-risk assets. However prior to the outcome, investors are generally apprehensive and would withdraw their funds first, unless they know for a fact that there will be a rate cut.

Meanwhile, data has revealed that the chance of a rate cut during the FOMC in December is over 85%. This means there’s only a 15% chance that the Fed will leave the rates as they are or raise it higher, although a rate cut alone isn’t enough to predict the crypto market these days

After the last rate cut in September when investors were eagerly waiting for a pump, crypto continued to nuke and still does at the time of this writing. If things turn out like the previous rate cut, nothing exciting may happen but if not, good days may follow the announcement.

Will the Fed Approve Rate Cuts?

Data has revealed a high chance of getting at least 25 bps cut next week, but it’s a different thing entirely for the Fed to actually approve a rate cut. This is why tension continues to mount as the day of the meeting draws closer.

Because of this uncertainty, Poppe cautions traders to be careful with trades or even simply buying some assets to hold and sell in the short-term until after the FOMC meeting because of the volatility that usually characterizes the time.