Tom Lee is the head of research at Fundstrat and the Chief Investment Officer at Fundstrat Capital. He recently made comments about the latest Fed hike, as the Federal Reserve raised interest rates. The Federal Reserve increased the federal funds target rate by 25 basis points, raising it to between 3.75% and 4% with this Fed hike.
This happened after the CLARITY Act failed to pass a vote in the Senate. Despite these two potentially negative events for crypto, the price of Bitcoin increased from below 76,000 dollars to over 86,000 dollars. Additionally, the S&P 500 futures stabilized after a few days of losses.
Post Fed Hike
Tom Lee believes that the Federal Reserve has reached peak hawkishness after the latest Fed hike regarding inflation and interest rates.
The Federal Reserve is expected to change the way they calculate inflation, their preferred gauge, which could show inflation is lower than previously thought and lead to a softer tone after the Fed hike. Lower inflation means cryptocurrency like Bitcoin will be more attractive to investors.
Additionally, the CEO of iTrustCapital, a company that allows investors to invest in cryptocurrency in their retirement accounts, believes that the end of the crypto winter is near and they are beginning to redeploy idle client cash.
Also Read: Bitcoin Falls $1,600 as 162,000 Jobs Lift Fed Hike Bets
Macro Crosscurrents And Industry Ramifications
While Lee’s optimistic view that a 25bp hike would not break the economy or market stands in the face of rival institutional perspectives caution is materializing. Goldman Sachs analysts observe the S&P 500 tends to decline ~2% in the three months following hiking while Yardeni Research lowered targets as 10 year treasury yields moved through a 5% threshold.
Rising long duration yields intensify pressures on venture investment debt stablecoin collateral and the cost of DeFi based lending. Regulation heightens macro indecision. The failure of the CLARITY Act has left SEC and CFTC without delineation for digital assets leaving enforcement driven activity intact and organizations awaiting clarity for staking custody and product design.
Historically high hawkishness with a subsequent dovish pivot has predicted a rally in high beta assets including Ethereum and Solana but past is no assurance of future performance.
Also Read: Tom Lee: 2026 Is a Unique Time for US Investors Amid Tech Boom
What are the Upcoming Catalysts?
In the meantime consumers investors institutions and issuers are awaiting. First, the September 30 core PCE revision will test Lee’s disinflation call. Second, the upcoming Fed speakers may dial down hawkish afterwords, providing incrementally dovish datapoints. Third, on chain signals from Glassnode and ETF flow data from SoSoValue will show whether the move above 86K dollars reflect organic demand or short covering.
Source: CNBC
When rate expectations peak after a Fed hike and positioning is extended, improving inflation releases can drive a face ripping rally, as Lee called it. For investors, institutions, developers, and exchanges the environment still calls for disciplined risk management even after the Fed hike.
If method shifts do in fact drive PCE into 3% after the latest Fed hike, this would bolster the argument that tightening has peaked, potentially reigniting institutional allocation to Bitcoin, Layer 1 networks, and the broader blockchain infrastructure in a sustainable way from now on.
Also Read: Tom Lee Fed Rally 2026: Massive Bullish Rally Coming Fast
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