The US Federal Reserve will release the minutes of its June 16-17 meeting on Wednesday at 2pm ET, a release that could either validate Bitcoin’s week-long rally or eliminate its foundations.
Traders rallied on a single macro assumption: a weakening U.S. labor market limits how long the central bank can remain hawkish. The minutes are the first complete record of internal deliberations under Chairman Kevin Warsh and reveal whether officials shared those concerns in mid-June, weeks before the jobs report that prompted the rally.
There is a big movement based on that answer. Bitcoin traded around $64,000 on Tuesday, up almost 11% from a 21-month low of less than $58,000 hit on July 1, and fluctuated more than $3,400 between $61,250 and $64,659 on Monday.
The recovery began on Thursday with U.S. jobs data showing that employers added 57,000 jobs in June, about half of what economists expected. Bitcoin rose along with gold and stocks as traders scaled back bets on further interest rate hikes after weak labor data, in what Barron’s described as “a return to US interest rate hikes.”
Bitcoin Market Changed Fed’s Price Before Understanding Fed’s Logic
At the June meeting, almost no cryptocurrencies could be handled at the time. Officials kept interest rates unchanged at 3.50% to 3.75%, removing previous hints of a possible early rate cut and changing their median forecast for 2026 to at least one additional rate hike. Over the next two weeks, Bitcoin fell towards its lowest price as the market priced in a prolonged period of tight monetary policy.
However, the situation has completely changed with employment statistics. Beyond the headline error, the Bureau of Labor Statistics (BLS) reduced payrolls by a combined 74,000 people in April and May, and the unemployment rate dropped to 4.2% only because about 720,000 people left the labor force and the labor force participation rate fell to 61.5%.
Traders reacted by raising expectations for a subsequent rate hike. CME FedWatch pricing currently suggests a roughly 76% chance that the Fed will raise rates at its July 28-29 meeting, and a roughly 40% chance of raising rates by December.
If Wednesday’s minutes show that officials are already warning of the risks of a softening labor market, tight credit, or over-tightening, it could give support to a dovish market and lay the groundwork for a recovery.
If the debate centers on sustained inflation and the conditions for further rate hikes (which is how Mr. Warsh has publicly framed the decision), this bull market will lose its main pillar. Bitcoin is already pricing in meaningful relief, and a document that falls short of market dovish expectations could be enough to weigh on prices. Since the bounce occurred in the first place, the bar for disappointment is low.
Daily inflows and 49,000 BTC new exchange supply
Similar vulnerabilities can be seen on the ETF side of the bull market. The U.S. Spot Bitcoin ETF received $223 million in inflows on Thursday, its largest single-day inflow since May and ending a 10-day streak of withdrawals that had drained the fund of $2.73 billion.
One session stopped the bleeding without reversing it. The product has lost nearly $8.5 billion since early May, and institutional demand will need several consecutive days of inflows before the drawdown starts to look like an entry point for the data.
On-chain flows require even more caution. Whale-sized deposits on the exchange reached around 49,000 BTC as the price regained $60,000, increasing the supply available for sale in line with the post-minute strength.
Option positioning is concentrated around the same zone, with dealer gamma concentrated at $60,000 and $62,000, levels that could either lock in the price or accelerate the decline depending on which direction it breaks.
The recovery will remain intact if it can maintain the $62,000 area after the session, and a break above Monday’s high near $64,700 will confirm it. A fall towards $58,000 would be a jobs-led rebound that would signal the failure of the bear market rally that began at an all-time high of $126,198 in October.
Bitcoin’s 11% rally was built on speculation about what Fed officials said behind closed doors three weeks ago. On Wednesday afternoon, speculation will be replaced by recording, and the difference between the two will determine the price.
(Tag to translate) Bitcoin
