Leading cryptocurrencies tanked Wednesday after the Federal Reserve's hawkish outlook and the central bank’s statement that it has no interest in owning Bitcoin.
| Cryptocurrency | Gains +/- | Price (Recorded at 7:45 p.m. ET) |
| Bitcoin BTC/USD | -4.94% | $100,644.84 |
| Ethereum ETH/USD | -5.81% | $3,648.03 |
| Dogecoin DOGE/USD | -8.26% | $0.3603 |
What Happened: Bitcoin plunged sharply through the day but managed to stay above the psychologically crucial $100,000 mark.
Ethereum's descent was steeper, as the second-largest cryptocurrency retreated to the $3,600 region following a near 6% drop.
The slump triggered over $675 million in cryptocurrency liquidations in the last 24 hours, with long liquidations hitting $578 million.
The decline came following Fed Chair Jerome Powell's comments during the press conference following the Federal Open Market Committee meeting, where he disclosed that the central bank can't hold Bitcoin and it wasn't looking for a law change.
Bitcoin's Open Interest dropped 1.1%, however, the number of traders taking long positions for the coin surged above 50%, indicating expectations of a revival.
Over $1 billion in short positions risked liquidation if Bitcoin recovers to $105,900.
Market sentiment cooled from "Extreme Greed" to "Greed," according to the Cryptocurrency Fear & Greed Index, signaling a decline in FOMO.
Top Gainers (24-Hours)
| Cryptocurrency | Gains +/- | Price (Recorded at 7:45 p.m. ET) |
| Pudgy Penguins (PENGU) | +21.82% | $0.03574 |
| Bitget Token (BGB) | +7.95% | $4.24 |
| Monero (XMR) | +0.87% | $214.23 |
The global cryptocurrency market capitalization stood at $3.51 trillion, dropping over 5% in the last 24 hours.
Stocks got pounded on Wednesday. The Dow Jones Industrial Average plunged 1,123.03 points, or 2.58%, to close at 42,326.87 as the index posted its 10th consecutive losing day. The S&P 500 slipped 2.95%, ending at 5,872.16, while the tech-focused Nasdaq Composite dipped 3.56% to 19,392.69.
The market suffered despite the Fed's latest 25-basis-point reduction as Chair Powell hinted at a more cautious stance in 2025, with just two more 0.25% rate cuts projected next year, compared to the four anticipated in September.
The benchmark 10-year Treasury yields leaped to 4.5%, the highest since early June, as risk sentiment evaporated.
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Analyst Notes: Widely followed cryptocurrency analyst and trader Ali Martinez weighed in on the central bank's policy shift, stating that 2025 looks a "lot less rosy."
"For now, keep calm, don't panic sell, and remember: markets hate uncertainty, but they also thrive on it when the dust settles. Let's see where this goes from here," Martinez advised traders.
In his analysis of the Federal Reserve action, Ali said, “It wasn't today's 25 bps cut that made markets freak out—it was the realization that inflation might stick around longer, and the Fed's not quite ready to take its foot off the gas. Sentiment is shifting, and 2025 suddenly looks a lot less rosy.
Another well-known analyst, Rekt Capital, noted Bitcoin's daily close above $100,000 but cautioned that it wasn't enough.
“However, for BTC to move up from here, it would need to reclaim ~$101,000 as support, much like it did on Dec. 14. Otherwise, $101,000 could turn into new resistance, which could mean the downside isn’t over," the analyst stated.
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