Kevin O’Leary, the American entrepreneur and investor, has dismissed speculation that the US Federal Reserve will lower interest rates in December — a change commonly seen as positive for crypto.
Nonetheless, O’Leary does not expect a Fed rate hold to negatively affect Bitcoin’s (BTC) value.
“I don’t actually think the Fed’s gonna cut in December,” O’Leary, known as “Mr Wonderful,” told Cointelegraph in an interview on Tuesday, stressing that it’s not “gonna make a difference to Bitcoin.”
Mr. Wonderful doesn’t predict Bitcoin to fluctuate more than 5%
“I’m not investing that way. I’m not investing as if the Fed is going to cut rates. So I just don’t see it. I think there are lots of reasons why they might not,” O’Leary stated.
He noted the presence of “a lot of inflation in the system.” The annual inflation rate climbed to 3% in September, the highest figure since January.
“It’s a dual mandate, full employment and inflation. And so the tariffs are starting to take hold and input costs,” O’Leary remarked. Despite these concerns, market players have assigned a probability of 89.2% to a Fed rate cut in December, according to the CME’s FedWatch Tool.
Crypto traders generally view Fed rate cuts as bullish for riskier investments like crypto, as investors usually pivot from bonds and term deposits that become less attractive.
However, an unexpected Fed rate decision could adversely affect Bitcoin’s price and the wider crypto market, according to some concerns.
Still, O’Leary does not foresee this happening.
O’Leary asserted that Bitcoin has established “a level for now” and does not predict significant declines in its price. “I think it’s going to sort of drift within 5% of where it is now, in either direction, but I don’t see a lot of upside catalyst,” O’Leary indicated.
Bitcoin is presently trading at $91,440, according to CoinMarketCap.
Fed rate volatility escalates ahead of decision
Market sentiments regarding a December rate cut were considerably less favorable just weeks prior.
On Nov. 19, the chances of an interest rate cut at the December meeting fell to 33%, following a period when investors estimated the likelihood of a December rate cut at around 67% in the first week of November.
Related: Bitcoin mispricing deepens as BTC trades below $100K, but not for long: Bitwise
However, merely days later, on Nov. 21, the odds surged to 69.40% after dovish comments from New York Fed president John Williams, who asserted the Fed could cut rates “in the near term” without jeopardizing its inflation targets.
Bloomberg analyst Joe Weisenthal stated that this was the catalyst for the “significantly increased” odds.
In the wake of the initial interest rate cut of 2025 in September and another cut in November, the markets widely anticipated that the Federal Reserve would continue easing policy until year-end.
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