Bitcoin Recovery Forecast Hinges on Federal Reserve Rate Cut and Liquidity Growth

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Bitcoin Recovery Forecast Hinges on Federal Reserve Rate Cut and Liquidity Growth — Image source: Unblock Media

Coinbase analysts anticipate Bitcoin recovery in December 2025.
Federal Reserve rate decision and global liquidity improvement highlighted as critical factors.

On December 6, 2025 (17:08 UTC), Coinspeaker reported Coinbase analysts predicting a potential recovery for Bitcoin in December. The forecast hinges on improving global liquidity and a 92% probability of a Federal Reserve interest rate cut, which analysts assert could create favorable macroeconomic conditions for the cryptocurrency market.

Coinbase analysts referenced their global M2 money supply index as a primary metric of liquidity growth. The index suggests a recovery in the total outstanding fiat currency supply, historically tied to positive Bitcoin price momentum. With market data supporting a likely rate cut by the Federal Reserve in December, cryptocurrency investors are watching closely for signs of a liquidity surge powering Bitcoin’s upward trajectory.

Investor sentiment remains reserved in the lead-up to the December 10 Federal Reserve rate decision. Remarks by Federal Reserve Chair Jerome Powell following the announcement are expected to significantly shape Bitcoin’s outlook entering 2026. Previous hawkish statements from Powell have tempered investor optimism, adding complexity to market dynamics.

Market speculation regarding the Federal Reserve’s future leadership is emerging as another influence on Bitcoin price forecasts. Analysts are closely observing discussions on the expected appointment of National Economic Council Director Kevin Hassett as Federal Reserve Chair in early 2026. President Trump plans to announce his nominee early next year, and Hassett’s potential confirmation may indicate a shift to a more dovish monetary policy stance, fueling additional momentum for Bitcoin markets.

As of December 6, 2025, Bitcoin (BTC) is trading at $89,756.22, reflecting a 1.11% increase in 24-hour trading volume. Bitcoin’s market cap dominance stands at 58.61%, underscoring its continued leadership in the cryptocurrency space.