Fed Holds Rates as Two Members Favored a Hike, Bitcoin Slips Below $80K and 10-Year Yield Tops 5%

The Federal Reserve held interest rates steady at its October 28 meeting, but the decision was far from unanimous: two members voted for an outright increase, a hawkish split that rattled risk assets and muddied the outlook for Treasuries. The 10-year Treasury yield climbed back above 5.04% in the aftermath, while MarketWatch noted that incoming GDP and inflation data could make the Fed's wait-and-see posture harder to maintain.

Bitcoin bore the brunt of the reaction. After trading as high as $81,687 on Wednesday, partly lifted by a 6.6% surge in South Korea's KOSPI and broad tech optimism, BTC reversed sharply following the Fed announcement and slid 1.2% to around $79,923, breaching the closely watched $80,000 level. Exchange netflows turned positive for the first time in six weeks, signaling that traders were moving coins back onto platforms, and analysts flagged $79,700 as the next key support. Bitcoin Cash fell nearly 6% to $279.87, dropping below its 200-day moving average at $286.19, with the Fed's rate pause and the two dissenting votes cited as the trigger. Ether also declined 1.75% to $2,312.26.

The price weakness came despite $423.66 million in spot Bitcoin ETF inflows over the prior three days, a divergence that highlighted shifting ownership dynamics: major trading firms have been trimming ETF positions while sovereign wealth funds and wealth managers have been quietly adding. Separately, the U.S. Treasury executed a $6 billion long-bond buyback on October 27, accepting offers from $10.75 billion submitted by dealers, bringing October's total buybacks to $26.08 billion. The operation targeted 20-to-30-year bonds and was aimed at supporting market liquidity amid concerns over declining Chinese Treasury holdings, with the next buyback tentatively set for November 4. Bitcoin failed to rally on the liquidity injection, underscoring that sovereign bond interventions are losing their immediate market punch.

Looking further out, Bitwise raised its Bitcoin price target to $1.6 million by 2036, projecting compound annual gains of 34.3%, roughly five times its 6.7% forecast for U.S. stocks over the same period. About 82% of that modeled valuation depends on a gold-and-Bitcoin demand convergence thesis, a concentration of assumptions that stands in sharp contrast to JPMorgan's more conservative return projections. On the calendar, Bitcoin has risen in only three of the past eight Novembers, a seasonal headwind traders are weighing as the month begins.