Bitcoin Recovers as Fed Rate Cut Bets Grow, but Corporate Strategy Doubts Weigh

Bitcoin edged higher on Tuesday, trimming some of its recent losses as investors grew more confident that the Federal Reserve will cut interest rates in September. The world’s largest cryptocurrency rose 0.8% to $111,812.8 at 00:51 ET (04:51 GMT), briefly topping $112,000. Despite the rebound, concerns about corporate Bitcoin-buying strategies limited gains.

Crypto markets broadly bounced back after sharp early-September losses, though they lagged behind equities and gold. Traders are betting on a 90% chance of a 25-basis-point Fed rate cut next week, driven by signs of cooling in the U.S. labor market. A 9.9% chance remains for a deeper 50 bps cut, according to CME FedWatch.

Skepticism over long-term returns from corporate Bitcoin accumulation has weighed on sentiment. Strategy (formerly MicroStrategy) and Metaplanet Inc., two major corporate buyers, have seen share declines despite adding to their Bitcoin holdings. Analysts warn that this strategy ties company valuations too closely to Bitcoin price swings and may lose appeal as more firms adopt similar approaches.

Circle Internet Group (NYSE:CRCL), the operator of stablecoin USDC, also fell to a three-month low after Compass Point Research cut its price target and maintained a Sell rating. The decline followed decentralized exchange Hyperliquid’s plan to launch a competing stablecoin, USDH, backed by $5.4 billion in converted USDC deposits—roughly 8% of total supply.

Altcoins posted modest gains: Ether rose 0.4% to $4,314.06, XRP climbed 3.4% to $2.9627, Solana added 3.7%, and Cardano gained 3.4%. Meme coins Dogecoin and $TRUMP also advanced.

Investors are now watching U.S. inflation data for August, which could influence the Fed’s next move. Any signs of tariff-driven price pressure may impact the pace and size of upcoming rate cuts.