Bitcoin, crypto rally expected to resume after dip on hawkish Fed minutes, analysts say

Bitcoin and cryptocurrency prices posted moderate losses following hawkish signals from minutes of the May 6-7 Federal Open Market Committee (FOMC) session released Wednesday.

U.S. Federal Reserve officials flagged potential “difficult tradeoffs” tied to persistent inflation and looming recession risks. "Participants agreed that uncertainty about the economic outlook had increased further, making it appropriate to take a cautious approach until the net economic effects of the array of changes to government policies become clearer,” the minutes read.

Bitcoin closed in losses below $107,800 following the release but has since rebounded to around $108,500, per The Block’s price page . Meanwhile, ETH closed May 28 in green and climbed higher to $2,711 on Thursday. Altcoins were mixed — XRP and SOL fell, while selective coins like Dogecoin gained, cushioning the GMCI 30 Index .

Rally optimism

Despite the brief pullback, analysts at BRN noted that institutional demand remains strong. U.S. spot Bitcoin ETFs have recorded 10 consecutive days of inflows, with BlackRock leading the pack . Fournier added that more firms have unveiled plans to accumulate BTC as a treasury asset, a move poised to support buying pressure. Trump Media, for instance, intends to create a private Bitcoin treasury with a $2.5 billion offering . Some entities, like GameStop and Strategy , also shared Bitcoin purchases this week.

“Bitcoin continues to benefit from its positioning as a hedge and long-term asset. Corporate adoption remains strong, with more firms launching BTC reserves,” BRN’s analysts told The Block via email. He expects the rally to continue once profit-taking eases.

Glassnode data showed rising profit realization, but analysts noted that historical tops typically come with more extreme metrics.

“As price rallied through the previous ATH, a notable uptick in profit-taking was recorded, with only 14.4% of days recording higher values. This suggests profit-taking has increased, but has not yet reached extreme levels,” a Glassnode report said. “We have yet to reach the truly euphoric heights seen during prior major price topping formations.”

Looking ahead, traders are eyeing Friday’s Personal Consumption Expenditures report — the Fed’s preferred inflation gauge — as a key macro trigger. Dr. Kirill Kretov, senior automation expert at CoinPanel, told The Block that a softer print could ease the Fed’s inflation concerns and incentivize a rate cut.

Conversely, hotter data may spook markets and promote a risk-off mood. “Given the fragile structure of crypto liquidity, expect outsized price reactions either way, even if the data only misses or beats by 0.1%,” Kretov noted.