Why Is Bitcoin Going Up? Trump Fuels Rally With Push for 3% Fed Cut

Bitcoin surged to a new all-time high above $112,000 on Wednesday, breaking out of weeks-long consolidation after U.S. President Donald Trump called the Federal Reserve’s interest rates “at least 3 points too high.” The move came amid a broader rally across crypto assets, with Ethereum’s ether jumping 5% to $2,746, its highest in nearly a month.

Earlier, the largest cryptocurrency gained 3% to $111,907, briefly reaching new record levels across major exchanges including Binance, Coinbase, and Bitstamp.

The breakout followed a prolonged period of price compression near $110,000, where previous rallies had repeatedly reversed as traders took profits and short positions mounted.

Trump Comments Trigger Risk-On Repricing

The sudden upward move began just 30 minutes after Trump posted on Truth Social that the current federal funds rate should be lowered by 300 basis points (3%). He claimed such a cut would save $360 billion annually in refinancing costs. Bitcoin, which had been trading quietly earlier in the day, began climbing steadily following the post.

No single cut in modern U.S. history has exceeded 100 bps, and a 3% reduction in a growing economy could push inflation above 5%, weaken the dollar by over 10%, and cause housing prices to surge amid lower mortgage rates, Coindesk reported.

Asset markets, including stocks and commodities, would likely rally sharply in the short term—the S&P 500 could reach 7,000, and gold $5,000, but at the cost of longer-term macroeconomic stability.

BREAKING: Bitcoin reaches new all-time high of $112,000 pic.twitter.com/4AxGaQgZN7

— Watcher.Guru (@WatcherGuru) July 9, 2025

Publicly Traded Crypto Firms

The rally extended to publicly traded crypto firms. MicroStrategy (MSTR) climbed 4.4% to $414, approaching its 2025 highs but still below last year’s $543 peak. Coinbase (COIN) rose 5%, while bitcoin miners Riot Platforms (RIOT) and Marathon Holdings (MARA) added around 6% each.

Related: Bitcoin Will Jump 25% and Hit New ATH This Quarter, Newest BTC Price Prediction Says

Ether also drew investor attention, rising 5% to $2,746. Bitcoin’s climb also reflects its increasing role as a hedge against monetary uncertainty. Since Trump’s “Liberation Day” speech in April, the asset has gained traction among investors positioning for inflation and geopolitical risk.

While Bitcoin’s price has now set a new record, questions remain about its ability to hold above $112,000. The $110,000 zone could flip into support if momentum continues, but traders are watching closely for signs of exhaustion or consolidation.