According to analysts at Bitfinex, the future of the leading cryptocurrency largely depends on the interest rate decision that the US Federal Reserve will make this month.

In their report, the experts attributed Bitcoin's recent 32% rise to speculation about the agency's dovish stance. However, they noted that the rate cut expected now could "significantly impact both BTC's short-term volatility and its long-term outlook."

A 25 basis point decline would likely signal the start of a easing cycle that could lead to a long-term rally in the Bitcoin price as liquidity increases and recession fears ease, Bitfinex analysts wrote.

They also warned that a more aggressive 50bp cut could cause an immediate price spike followed by a "correction as recession fears intensify."

Analysts expect Bitcoin to face a 15-20% drop to $40,000-$50,000 after the rate cut. Their forecast is based, among other things, on the fact that September is a historically turbulent month for the flagship asset. The analysts noted that Bitcoin's volatility, coupled with the risk of massive selling amid the rate cut, could create "both risks and opportunities for traders."

The US Federal Reserve will meet on September 17 and 18, and most analysts expect a rate cut. However, it is unclear how significant the change will be.$BTC