Bank of America predicts three Fed rate hikes, creating pressure on Bitcoin prices

Bank of America has raised the prospect of three Federal Reserve rate hikes this year, a shift that could keep pressure on Bitcoin and other risk assets if borrowing costs stay higher for longer.

The forecast, reported by Reuters, comes from Bank of America Global Research and adds a fresh macro headwind to a market that has already been sensitive to every hint of tighter policy. Higher rates tend to pull money toward cash and short-dated government debt, while assets such as Bitcoin often struggle when investors are less willing to take risk.

That matters because Bitcoin has spent much of the past year trading as a high-beta asset, moving sharply when expectations for rate cuts or hikes change. When traders think the Fed is done easing, or worse, ready to tighten, leverage gets trimmed and speculative positions become harder to hold. Crypto prices can fall fast on that kind of shift, even without any change in blockchain fundamentals.

Bank of America’s call also lands at a delicate time for markets more broadly. Stocks, tech shares and crypto have all leaned on the idea that the central bank could eventually turn more supportive. A three-hike path would push in the opposite direction, keeping financial conditions tight and leaving fewer reasons for investors to chase volatile assets.

For Bitcoin, the immediate focus is not just the forecast itself, but whether other Wall Street banks begin to follow it. If more firms start leaning toward renewed tightening, the market could reprice rate expectations quickly. That would likely show up first in Treasury yields, the dollar and risk appetite across equity and crypto desks.

Traders will now watch upcoming Fed commentary and the next inflation readings for confirmation or rejection of that view. If policymakers push back against the idea of multiple hikes, some of the pressure on Bitcoin could ease. If they do not, BTC may have a harder time holding recent gains.