Fed Rate Cuts Fail to Boost Crypto as Bitcoin Tumbles

Bitcoin experienced a week of dramatic price swings despite seemingly favorable macroeconomic conditions. The cryptocurrency began the period trading near $110,000 after recovering from a dip to $106,000, then surged past $113,000 on Sunday following US Secretary Bessent’s hints at a potential Washington-Beijing trade deal. The momentum continued through Monday and Tuesday, with BTC peaking above $116,000 before facing what the source text describes as an ‘immediate and forceful rejection’ that pushed prices back below $113,000 almost instantly.

The Federal Reserve’s expected 25 basis point interest rate cut on Wednesday failed to provide the anticipated boost to risk assets like Bitcoin. Instead, the cryptocurrency slipped by ‘a few grand’ within 12 hours to under $108,000. Thursday brought another temporary rally when former President Trump reduced overall tariffs on China to 47% and hinted at a more impactful trade deal, pushing Bitcoin above $111,500 briefly before another decline sent it below $106,500 by Thursday afternoon. The asset managed to recover some ground, ending the week testing the $110,000 resistance level with a modest 0.6% weekly decline.

While Bitcoin’s weekly performance showed relative stability, the altcoin market experienced much more pronounced movements. According to the provided data, several major altcoins including ADA, DOGE, and AVAX posted ‘more significant price drops’ than Bitcoin. The worst performers included ENA, PEPE, UNI, and MNT with losses reaching up to 16%, indicating substantial selling pressure across various segments of the crypto market.

However, not all digital assets suffered during the turbulent week. Several cryptocurrencies posted impressive gains despite the overall market uncertainty. HYPE and BCH both surged by 11%, while HBAR jumped 17% and TAO gained 21%. The standout performer was ZEC, which ‘rocketed by 44%’ according to the source text. This divergence in performance underscores the selective nature of current market movements, where specific catalysts and developments are driving individual token performance rather than broad market sentiment.

The broader market metrics showed a cryptocurrency market capitalization of $3.770 trillion with 24-hour trading volume of $169 billion and Bitcoin dominance at 58.1%. Ethereum declined 2% to $3,860 while XRP managed a slight 0.71% gain to $2.51, reflecting the mixed performance across major digital assets.

Several significant developments occurred during the week that influenced market dynamics. Despite the ongoing US government shutdown, regulatory progress was made with the approval of first spot ETFs for Solana, Litecoin, and HBAR. The source text specifies that funds issued by Bitwise, Canary Capital, and Grayscale received ‘the green light’ to track these altcoins, representing a major step forward for cryptocurrency adoption in traditional finance.

Corporate activity also made headlines, with Crypto.com’s CRO token exploding ‘by 10% hourly’ after Trump Media announced it would introduce prediction markets using the Crypto.com platform. The source text notes this made Truth Social ‘the first social media platform to do so,’ creating immediate buying pressure for the associated token.

Institutional accumulation continued despite market volatility, with Michael Saylor’s MicroStrategy announcing another Bitcoin purchase on Monday. The company bought 390 BTC worth $43.4 million, continuing its strategy of ‘almost weekly’ accumulation. This persistent institutional buying contrasts with what analyst Pierre Rochard described as ‘OG whales taking profits lately,’ creating competing pressures in the market.

The market’s failure to respond positively to traditional risk-on catalysts like interest rate cuts puzzled many observers. According to the source text, CryptoQuant data showed that ‘institutional demand has weakened after Powell’s warning about the state of the economy.’ Other market participants attributed the price action to a ‘classic buy-the-rumor, sell-the-news event,’ where traders had already priced in the expected Fed move before it occurred.

Despite the short-term price pressures, some analysts remained optimistic about Bitcoin’s long-term prospects. Crypto analyst Pierre Rochard argued that ‘Bitcoin’s strong fundamentals outshine short-term price dips,’ noting that while OG whales have been taking profits, the asset’s ‘intrinsic utility and fundamental value have only increased.’ This perspective suggests that current market movements may represent temporary profit-taking rather than fundamental deterioration.

The week also saw renewed attention on the FTX saga, with a post from Sam Bankman-Fried’s X account claiming ‘FTX was never insolvent.’ The crypto community quickly disputed this assertion, according to the source text, creating additional uncertainty in a market already grappling with mixed signals from traditional finance and geopolitical developments.