Prices of Bitcoin and Ethereum started to stabilize following a steep decline driven by the release of the Federal Reserve meeting minutes, which impacted global markets.
Impact of Fed Minutes on the Market
The release of the Federal Reserve meeting minutes indicated that no immediate rate cuts were expected, affecting the crypto markets. Bitcoin and Ethereum began to stabilize after recent declines. An analyst noted: "Market open interest dropped to $195.34B with $448M in liquidations—a clear sign of volatility and leveraged positions being unwound before clarity from the Fed."
Investor Reactions to Market Sentiment
Bitcoin and Ethereum prices stabilized as the market digested the Fed’s position. Caution prevailed among investors, with significant outflows from Ethereum ETFs indicating uncertainty in regulatory and macro frameworks. Ethereum ETFs faced two consecutive days of outflows after a prior fortnight of inflows, suggesting de-risking by institutions ahead of the Fed’s Jackson Hole meeting.
Historical Fed Actions and Crypto Volatility Analysis
Previous actions by the Federal Reserve have similarly led to temporary volatility, followed by stabilization once clarity emerged. Analysts observe patterns where major cryptocurrencies react robustly to macroeconomic shifts.
In conclusion, amidst ongoing macroeconomic uncertainty, Bitcoin and Ethereum prices show signs of stabilization; however, market volatility is likely to persist until clearer signals emerge from policymakers.
