Synopsis– The cryptocurrency market has closely followed the Federal Reserve’s actions over the past three years. Rising interest rates in 2022 and 2023 weighed on digital assets as investors shifted to safer options. Then in 2024, three rate cuts by the Fed breathed new life into the market, driving optimism back into Bitcoin, Dogecoin, and XRP.
So far in 2025, inflation has remained sticky. According to recent data from The Motley Fool, this could delay immediate cuts. Still, many analysts expect at least one or two reductions before year’s end. If that happens, three cryptocurrencies stand ready to benefit.
1. Bitcoin
Bitcoin remains the world’s largest cryptocurrency, with 19.9 million tokens mined from a total cap of 21 million. Investors often view it as digital gold in times of market stress. Lower rates would pressure the U.S. dollar, making Bitcoin more attractive as a hedge against inflation. Rate reductions typically weaken fiat currencies, and Bitcoin often rises in response.
Other catalysts also build momentum. Early in 2024, the first spot Bitcoin ETFs gained approval, pulling in institutional and retail money. In April, the most recent halving event slashed mining rewards, tightening supply. Meanwhile, several governments, including the United States, eased regulations and accumulated reserves. Together, those factors continue to boost its profile as an inflation shield. A further rate cut could serve as the spark for wider adoption in 2025.
2. Dogecoin
Dogecoin began as a meme coin but turned into one of the most-discussed digital assets. It uses the same proof-of-work method as Bitcoin but has no supply limit. Nearly 150 billion coins already circulate, adding inflationary pressure. Still, the coin thrives on its culture. Billionaire Elon Musk has often referenced Dogecoin publicly, from Tesla’s acceptance of it for certain products to his role in the short-lived “Department of Government Efficiency” (DOGE) experiment. Such high-profile mentions fuel its appeal among retail traders.
Social media also plays a big part. Dogecoin-related posts have 11.2 billion views on TikTok, while its Reddit community has over 2.7 million members. This scale ensures the coin gains traction quickly when investor enthusiasm emerges.
Looking ahead, several firms are awaiting approval for Dogecoin ETFs, and its new Dogechain network offers real utility by supporting decentralized apps. If rate cuts spark another wave of excitement, Dogecoin’s vast audience could push prices higher.
3. XRP
Unlike Bitcoin or Dogecoin, XRP cannot be mined. Its full supply of 100 billion tokens was created before hitting the market. Ripple Labs, the company behind it, uses XRP to power an alternative to SWIFT transfers, promising cheaper and faster international payments. The SEC’s lawsuit against Ripple dragged on for four years, creating uncertainty for investors. That case finally ended last year with a lighter-than-expected fine. Since then, XRP has reappeared on major exchanges, regaining attention.
Alongside potential rate cuts, other forces support its growth. Its first spot ETF debuted recently, and banks have begun adopting it for cross-border transactions. Developers are also enhancing its blockchain by creating lightweight programs known as “hooks.”
These advances could allow XRP to outperform many rivals. Its unique real-world uses make it a favorite among investors seeking practical applications within blockchain ecosystems.
Why Rate Cuts Can Matter Now
When interest rates fall, investors often shift back toward assets that promise growth rather than safety. Cryptocurrencies, volatile by nature, generally benefit from this trend. In 2022 and 2023, rising rates weakened the market. But in 2024, the three rate cuts marked a sharp turnaround.
If the Fed makes one or two cuts in late 2025, Bitcoin, Dogecoin, and XRP will likely gain momentum. While each has unique drivers scarcity, community influence, and fintech utility all three stand in line to ride the next wave of optimism. Analysts remain cautious, however, with inflation still a factor. Yet investors seeking exposure to digital assets may see opportunities as policy loosens again later this year.
Written By Fazal Ul Vahab C H
