The Federal Reserve (Fed) caused serious volatility in Bitcoin 
$78,318 and the cryptocurrency market with its announcement of a 25 basis point rate cut on Wednesday. Following this announcement, the price of Bitcoin fell below the critical support level of 100,000 dollars. The selling pressure stemmed from the market’s reaction to the Fed’s anticipated limited rate cuts for 2025 and beyond.
Crypto Market Sees $860 Million Liquidation
The decline in Bitcoin triggered losses of up to 10% in altcoins such as Ethereum (ETH) 
$2,399, Dogecoin 
$0.098061 (DOGE), XRP, and Solana 
$88 (SOL). This situation led to a total liquidation of positions amounting to $860 million. The blockchain analysis platform Santiment noted that Bitcoin exhibited a more resilient performance compared to the S&P 500 index.
Fed Chair Jerome Powell stated that only two rate cuts are planned for 2025. This decision fell short of market expectations, deepening the wave of selling. Meanwhile, analyst Alex Kruger highlighted on Twitter that Bitcoin could find support at the $98,000 level, stressing that the euphoric sentiment in the crypto market has significantly diminished.
Widespread Declines in Altcoins
Losses in altcoins were sharper than in Bitcoin. Ethereum managed to stay above the critical $3,550 level, showing some recovery. However, the price of XRP fell to $2.25, testing a critical support level. Analyst IncomeSharks noted that while Ethereum’s Supertrend indicator still signals upward movement, XRP could face further losses if it fails to maintain this level.
Meanwhile, the Bank of Japan’s decision to keep its policy rate unchanged caused the yen to depreciate against the dollar. Additionally, while BlackRock’s IBIT Bitcoin ETF continued to attract inflows, other ETFs experienced net outflows. Despite the negative impact on the market, BlackRock’s ETF managed to balance things out with an inflow of $356 million.
The Altcoin Season Index dropped to 55, prompting speculation that the weakening sentiment in most altcoins indicates the end of the altcoin season is approaching. The volatility in the cryptocurrency market is forcing market players to exercise greater caution.
