Bitcoin and Ether Hold Steady as Fed Delivers First Rate Hike in Three Years, US Lawmakers Advance Crypto Bills

Fed's First Hike Since 2023 Rattles, Then Steadies Crypto Markets

The Federal Reserve raised its target rate by 25 basis points for the first time in three years, lifting the range to 3.75%–4.00%. The decision passed unanimously, 12-0, with 16 of 18 officials signaling they expect at least one more hike before the end of 2026, a hawkish tone that kept traders on edge through the announcement.

Bitcoin briefly slipped toward $75,000 ahead of the decision before rebounding past $76,000 once the announcement landed, while Ether recovered to roughly $2,400. By Thursday, Bitcoin was trading near $76,460, up more than 1% on the day, with the total crypto market capitalization sitting at $2.71 trillion.

The rebound came despite continued pressure from institutional investors trimming exposure. Spot Bitcoin ETFs recorded a $295.98 million outflow, while Ethereum ETFs logged their largest single-day outflow of the month at $224.11 million, with BlackRock leading redemptions in both. Attention now turns to the Bank of Japan, whose own rate decision is widely seen as the next major catalyst for global risk assets.

House Committees Push Forward on Crypto Tax and Bitcoin Reserve Bills

While the Fed dominated headlines, Capitol Hill delivered its own string of developments for the digital asset industry. The House Ways and Means Committee advanced the Digital Asset Tax Certainty Act, H.R. 10357, by a vote of 38-5. The bill would ease tax calculations on stablecoin payments, and industry groups are still pressing for changes to how staking rewards are taxed, opposing taxation at the moment rewards are received.

A day earlier, the House Financial Services Committee voted 28-21 to advance the American Reserve Modernization Act of 2026 (ARMA), which would establish a US Strategic Bitcoin Reserve. An amended version of the bill consolidates the original 20-year lockup into a single enactment date and replaces quarterly attestations with annual public reporting. The bill still needs a full House vote, Senate passage, and a presidential signature, and with lawmakers set to leave Washington until after the November election, a floor vote this month looks unlikely.

What It Means for the Market

Together, the two storylines paint a picture of a market absorbing tighter monetary policy while regulatory clarity slowly builds in Washington. Analysts note that a 20-year lockup on federal Bitcoin holdings, if ultimately enacted, would remove the government as a scheduled seller of forfeited coins, ending a recurring source of supply without creating a new buyer. Combined with a Fed that has finally begun moving rates, but is signaling further tightening ahead, traders are likely to stay focused on both incoming economic data and the pace of legislative progress in the weeks ahead.