Grayscale Says Bitcoin Could Catch Up With US Stocks if Fed Skips Another Rate Hike

Bitcoin has lagged behind US stocks amid concern that the Federal Reserve may raise interest rates again, but the cryptocurrency could extend its advance if policymakers refrain from further tightening, Grayscale said.

Jack Pandl, Grayscale's head of research, wrote in a report published June 23 that the firm's base-case scenario is for the Fed to leave rates unchanged. In that case, Bitcoin could catch up with gains in US equities.

The report said US stocks have climbed about 9% since late February, when the Iran war began, while Bitcoin has fallen 1%. Gold has dropped about 20% over the same period.

Pandl attributed the relative weakness in Bitcoin and gold to concern over tighter monetary policy. Over the past several months, the market's outlook for one-year rates has risen by about 60 basis points, and roughly half of Fed officials see a rate increase in 2026 as potentially appropriate. The European Central Bank has already raised rates.

Bitcoin and gold are monetary assets that do not pay interest, Pandl wrote. As real yields rise, the opportunity cost of holding them increases, which can weigh on demand.