Bitcoin experienced a sharp recovery on Thursday as traders shifted their focus from Federal Reserve concerns to renewed optimism about a strategic Bitcoin reserve. The cryptocurrency bounced nearly 3% from Wednesday’s local lows, which had followed a more hawkish than anticipated Fed meeting on interest rates.
Federal Reserve Chair Jerome Powell maintained a cautious stance on future rate cuts after the Federal Open Market Committee kept rates unchanged at current levels. Powell offered no indication of policy easing at the upcoming September meeting, stating in his press conference that recent indicators suggest economic activity growth has slowed in the first half of the year.
The Fed chair emphasized that unemployment remains low while labor market conditions stay solid, though inflation continues to run somewhat elevated. Market expectations quickly adjusted to Powell’s tone, with CME Group’s FedWatch Tool showing traders now favor rates remaining unchanged in two months.
Strategic Reserve Optimism Fuels Recovery
Powell noted that employment data would carry greater weight in future decisions amid questions about sustained labor market strength. Initial jobless claims and the Fed’s preferred inflation measure, the Personal Consumption Expenditures index, were scheduled for release Thursday.
The FOMC outcome saw Powell resist pressure from President Trump to cut rates or step down, telling reporters he had “no updates” regarding resignation. However, market sentiment shifted when Robert “Bo” Hines, executive director of the President’s Council of Advisers on Digital Assets, reaffirmed the administration’s commitment to establishing a strategic Bitcoin reserve.
#Bitcoin price retargets $119K as treasuries buy 28K #BTC in two days pic.twitter.com/U68gp3HEVe
— Dynamic Nexus Crypto (@dnexus_crypto) July 31, 2025
Hines stated the White House remains on track to begin the strategic reserve “in short order,” expressing strong support for Bitcoin and the broader crypto community. This announcement helped Bitcoin regain momentum despite the Fed’s hawkish positioning.
Corporate Treasuries Drive Massive Accumulation
The volatile price action triggered significant liquidations across cryptocurrency markets, with CoinGlass data showing nearly $500 million in liquidations over 24 hours. Meanwhile, corporate Bitcoin treasuries seized the opportunity to increase their holdings substantially.
Charles Edwards, founder of Capriole Investments, highlighted that Bitcoin treasury companies executed one of their largest buying sprees on record during the market turbulence. Capriole’s data reveals corporate treasuries accumulated almost 30,000 BTC across Tuesday and Wednesday trading sessions.
Edwards noted that institutional net buying reached 97% of all transactions, a level not seen since August 2020. The significant institutional accumulation occurred while retail investors worried about Federal Reserve policy implications for risk assets.
Broader Market Sentiment Analysis
The combination of hawkish Fed policy and mixed signals regarding the strategic Bitcoin reserve timeline may create continued volatility in the near term. Corporate accumulation provides underlying support, though broader market uncertainty could weigh on short-term price action.
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