Bitcoin falls below $110,000 following Fed rate cut
The cryptocurrency market took a sharp dive on Wednesday following the Federal Reserve’s decision to cut interest rates by a quarter point, marking the second rate cut this year. Bitcoin (BTC) experienced a 3.6% drop to $110,663, while Ethereum (ETH) saw a 5% decline to $3,921. Other major altcoins such as XRP, BNB, and Solana (SOL) also suffered losses, with XRP falling 3% to $2.60, BNB dropping 2.6% to $1,105, and Solana slipping 3.1% to $193.
Despite the overall market pullback, certain coins managed to see substantial gains. Official Trump (TRUMP) surged by 17.9% to $8.25, Zcash (ZEC) rose 10% to $344.46, and pumpfun (PUMP) experienced a 6% climb. On the other hand, some cryptocurrencies struggled, with Aster (ASTER) down 8.8% to $1.05, Cronos (CRO) falling 7% to $0.1484, and Story (IP) dropping 5.4% to $4.89.
The global cryptocurrency market capitalization decreased by 2% in the last 24 hours to $3.84 trillion, with Bitcoin dominance at 57.6% and Ethereum dominance at 12.3%. According to Coinglass, approximately $851 million in crypto positions were liquidated over the past day, with long positions accounting for $658 million and shorts making up $193 million. Bitcoin led the liquidations at nearly $282 million, followed by Ethereum with $256 million, and Solana contributing over $80 million.
On Tuesday, spot Bitcoin ETFs attracted $202 million in inflows, marking the fourth consecutive day of inflows totaling around $462 million. Spot Ethereum ETFs recorded nearly $246 million in inflows, marking the second day in a row of positive inflows, as reported by SoSoValue.
The Federal Reserve’s decision to cut interest rates by 0.25% was driven by concerns about the labor market, with rates falling below 4% for the first time since late 2022. The government shutdown has limited the Fed’s access to comprehensive economic data. Fed Chair Jerome Powell highlighted the risks to the job market and emphasized the balance between supporting workers and preventing excessive inflation.
In the midst of this, President Donald Trump is set to meet with Chinese President Xi Jinping to discuss a potential trade agreement, aiming to alleviate weeks of uncertainty surrounding U.S.-China trade relations that have been pressuring the markets. This development comes amidst ongoing trade tensions between the two economic powerhouses.
