The Fed Held Its Fire, While Custody Went Federal

The Fed held interest rates on Wednesday, as the market expected. What was interesting was that two policymakers voted to hike, and Bitcoin barely blinked. Add the busiest fortnight of custody news I can remember and an index decision with a hard date attached, and this was a week with interesting headlines for institutional Bitcoin adoption.

TL;DR

• The Fed kept rates at 3.75 to 4.00 percent, with Governor Lisa Cook and Cleveland Fed President Beth Hammack dissenting in favor of a quarter-point hike. Bitcoin nudged back toward $81,000 after the announcement.

• The OCC gave Ripple National Trust Bank its final approval on October 26, extending the circle of federally supervised crypto custody alongside AnchorWatch's launch with optional Lloyd's-backed insurance of up to $370 million per client and Google Cloud's custody preview for 2027.

• MSCI finalized the index rules that will decide on November 11 whether Strategy and other digital asset treasury companies stay in its flagship indices.

The Fed Held, and the Dissents Did the Talking 🏦

The Fed came into this meeting having hiked in September for the first time since July 2023, taking the target range to 3.75 to 4.00 percent, with the dot plot penciling in one more move before year-end. Markets priced this one as a formality, better than nine-in-ten odds of a hold, which means the meeting was always about the December signal rather than the number.

The number came in as expected: no change.

Two policymakers, Governor Lisa Cook and Cleveland Fed President Beth Hammack, dissented in favor of raising rates by a quarter point, which tells you the September hike was not a one-off for everyone at the table.

Chair Warsh noted that financial conditions have tightened since September, and markets read the overall package as keeping a December hike firmly on the table when officials meet again in early December.

Warsh also announced a structural change. The FOMC will trim its rate-setting calendar, with one 2027 meeting devoted purely to strategy, neither a rate vote nor a policy statement anticipated, and two such meetings penciled in for 2028, leaving six for setting policy.

Bitcoin spent the week around $80,000 to $81,000, with the spot ETFs giving back roughly $773 million across two sessions late last week before a modest $110 million inflow on Monday.

After the announcement, Bitcoin nudged back toward $81,000 while equities barely moved. Thursday brings GDP and PCE, and the monthly options expiry lands Friday, so the macro calendar isn’t done with us yet.

My take is the boring one, and I will keep repeating it: I don't trade Fed meetings, and neither should you. A one percent move on a hold everyone saw coming is noise. What I watch is the direction of liquidity over quarters, and on that front a committee split between holding and hiking, with inflation still arguing for the latter, is precisely the environment in which a bearer asset with a fixed supply earns its keep.

Bitcoin produced a block roughly every ten minutes through the hiking cycle, the cutting cycle, and whatever this one turns out to be.

The Week Custody Went Federal 🏛️

While everyone watched the Fed, the custody business arguably had its biggest two weeks in years.

On October 26, the OCC gave Ripple National Trust Bank its final approval to operate as a national trust bank. Ripple applied in July 2025 and received conditional approval last December. Now, the conditions are cleared, and the bank is approved to provide institutional digital asset custody upon opening, under OCC supervision. To be clear, this isn’t a first. Anchorage converted to a national trust charter back in January 2021, and Fidelity has run a regulated trust-company custody business even longer.

What changed this month is the pace. The federally supervised custody club is growing again, and whatever you think of XRP, and regular readers know I am a Bitcoiner rather than a multi-chain romantic, but every new charter widens the lane for institutional money.

It didn’t stop there. AnchorWatch Trust Company opened its doors on October 19 as a Nevada-chartered qualified custodian offering optional insurance of up to $370 million per client, written by A+ rated Lloyd's of London syndicates and subject to underwriting.

Google Cloud previewed an institutional custody service built on multi-party computation, currently in private preview with a commercial launch targeted for 2027, and its New York symposium drew speakers from Morgan Stanley, Citi and Wells Fargo.

I have argued in this newsletter for years that institutions do not buy assets, they defer liability. The reason most pension funds and insurers wouldn’t touch Bitcoin in 2020 was that custody remained the barrier, because too few names in the approval chain could answer the question "and who holds it, under whose charter, insured by whom?"

This month the list of answers grew again with more federally chartered trust banks, a Lloyd's syndicate, and possibly Google.

MSCI Picked a Date, and Every Treasury Company Circled It 📅

The third story has a countdown attached. On October 15, MSCI finalized the methodology it will use to decide whether digital asset treasury companies remain in its global indices. The results of the review land on November 11, with changes effective after the close on November 30.

The final framework dropped the blunt 50 percent digital asset test from earlier drafts. Instead, companies face an operating-assets screen first and then a set of five financial ratios, with a flag on at least four of the five triggering exclusion.

Existing constituents get a margin of safety: they are removed only after failing in both of their two most recent annual periods, while prospective additions can be barred for failing in either one, and MSCI reserves the right to consider interim filings. MSCI's own list of potentially affected securities, built on September 30 data, is short, and Strategy is by far the largest name on it. Strategy's leadership has publicly urged MSCI to withdraw the rule, calling it discriminatory. JPMorgan analysts estimated last November that exclusion could mean around $2.8 billion of passive outflows from the stock, rising toward $11.6 billion if other index providers followed suit.

Index providers exist to define categories, and MSCI is drawing a line between operating companies and investment vehicles, which is a line that already exists everywhere else in finance. You can think the ratios are crude, and reasonable people do, while accepting that the question itself is legitimate.

What I will be watching on November 11 is how the world's largest index franchise classifies companies whose balance sheets are built around Bitcoin. That classification could shape how the next hundred corporate adopters structure themselves.

One for the Calendar 🗓️

Switzerland's first retail spot Bitcoin ETF, BIT Asset Management's BBIT, approved by FINMA on October 20, is expected to begin trading on the SIX Swiss Exchange in November. A spot Bitcoin fund trading in the home market of Swiss private banking is worth a calendar entry on its own.

Elsewhere in Bitcoin 📖

• Strategy paused its weekly Bitcoin purchases for the first time in five weeks, directing cash to preferred share buybacks instead.

• Anthropic is targeting a November IPO, timing unconfirmed, landing in the same stretch of the calendar as the November 3 US midterms, two macro events desks of every kind are watching.

• The comment window on the SEC's custody proposal runs until December 7, so the rules governing who may hold client assets are still being written.

Your fellow stacker in sats,

Patrick Lowry

P.S. Want to know what Bitcoin's purchasing power says about the dollars or euros in your pocket? Check it out here.

Disclaimer: Proof of Words is for informational and educational purposes only. Nothing in this newsletter constitutes financial, investment, legal, or tax advice, or an offer or solicitation to buy or sell any security or digital asset. Opinions expressed are those of the author and do not necessarily reflect the views of Samara Asset Group. Always do your own research and consult a licensed professional before making any investment decision.