Bitcoin News: Shocking 1.11% Drop as Fed Holds Rates Amid Inflation Fears
Bitcoin investors were caught off guard as the cryptocurrency plummeted 1.11% following the Federal Reserve’s decision to maintain interest rates. This sudden drop marks Bitcoin’s largest hourly correction in two weeks, sending shockwaves through the cryptocurrency market.
Why Did Bitcoin Prices Drop Suddenly?
The Federal Reserve’s announcement to keep rates at 4.25%-4.50% triggered immediate market reactions:
- Bitcoin fell to $116,320.13, briefly dipping below $116,000
- Ethereum dropped 1.74% to $3,712.36
- Solana declined 1.90% to $173.51
- XRP saw a 2.52% decrease to $3.04
- BNB retreated 1.46% to $775.27
Fed’s Stance on Inflation and Market Impact
Fed Chair Jerome Powell’s comments revealed ongoing concerns about economic stability:
- Revised language in Fed statement shows elevated inflation concerns
- Powell dismissed speculation about September rate cuts
- Contradiction with President Trump’s public statements created uncertainty
What This Means for Bitcoin Investors
Bitfinex analysts warn of potential further downside for Bitcoin:
| Key Metric | Value |
|---|---|
| Bitcoin Market Cap | $2.32 trillion |
| 24-hour Trading Volume | $68.44 billion |
| Potential Support Level | $114,000 |
Cryptocurrency Market Outlook
The total crypto market valuation stands at $3.8 trillion with mixed signals:
- Q2 GDP rebounded to 3% annualized
- Core PCE inflation eased to 2.5% quarter-over-quarter
- Market participants should monitor volatility and funding rates
Frequently Asked Questions
How much did Bitcoin drop after the Fed announcement?
Bitcoin experienced a 1.11% drop, its largest hourly correction in two weeks.
What was Bitcoin’s price at the time of the drop?
Bitcoin traded at $116,320.13, briefly falling below $116,000.
Why did the Fed’s decision affect cryptocurrency prices?
The Fed’s cautious stance on inflation created uncertainty, leading investors to reduce risk exposure.
What other cryptocurrencies were affected?
Ethereum, Solana, XRP, and BNB all saw significant drops following Bitcoin’s decline.
What should investors watch for in coming days?
Key indicators include order-flow patterns, volatility skew shifts, and funding-rate dynamics.
