- Fed Chair Jerome Powell expressed goals to focus on lesser rate cuts in 2025.
- Powell’s statement resulted in BTC dropping to $100K and ETH dropping to $3,600.
- Altcoins got “hammered” with LINK, AVAX, DOT, and XRP crashing massively.
The Federal Reserve Chair Jerome Powell’s recent comments have shaken sentiment across the digital asset space, with most altcoins suffering significant declines in the past 24 hours. Bitcoin (BTC) fell to the $100,000 price level, retreating from a daily high of $105,302.37.
According to blockchain analytics platform Santiment, the crypto and equities markets reacted negatively to the Federal Open Market Committee’s (FOMC) rate cuts. The concern, however, stems not from the current cuts but from Powell’s announcement that 2025 will only see half the number of rate cuts previously expected.
Lower interest rates are generally bullish for digital assets, as traditional investment options tend to lose appeal. High-volatility assets like Bitcoin often attract investors in such scenarios due to their higher return potential. However, Powell’s “hawkish” stance contrasted with market expectations, triggering widespread sell-offs.
Altcoins Face Double-Digit Declines
Powell’s announcement had an adverse effect on the sector. Bitcoin dropped 2.85% over 24 hours, but altcoins got hit harder. Ethereum (ETH) fell 4.7% to reach the $3,600 price range, while XRP and Dogecoin (DOGE) plummeted 6.3% and 6.22%, respectively. The total cryptocurrency market cap dropped 3.44% to $3.5 trillion.
Santiment report also highlighted significant losses on altcoins:
- Avalanche (AVAX): Down 8.17%
- Chainlink (LINK): Down 9.31%
- Litecoin (LTC): Down 11.40%
- Polkadot (DOT): Down 7.44%
Read also: Meme Coins Flounder Despite Bitcoin’s Bull Run: Investor Outlook
Potential Rebound for Oversold Assets
Despite the bearish sentiment, Santiment suggested that the market reaction might be overblown. Cryptocurrencies with the largest price declines, such as AVAX, LINK, and LTC, could present opportunities for investors seeking to capitalize on the dip.
Market indicators offer mixed signals. The daily Relative Strength Index (RSI) for non-Bitcoin and non-Ether assets sits at 50, suggesting equilibrium between buyers and sellers. The slight upward trend in RSI hints at a potential rebound.
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