Crypto Markets Experience Minor Dip Following Fed Chair's Remarks

On Wednesday, the cryptocurrency landscape experienced a slight downturn as Jerome Powell, the chair of the Federal Reserve Board, suggested that a 25-point interest rate cut announced for October could be the final reduction of 2025. Bitcoin saw a decrease of 1.6% over the last 24 hours, settling at approximately $111,000, based on data from Binance. Meanwhile, Ethereum, the second-largest cryptocurrency by market capitalization, dropped nearly 2%, trading just above $3,900. This led to an overall decline in the total cryptocurrency market capitalization, which fell by 1.8%.

During a press conference, Powell acknowledged the “strongly differing views” among Federal Reserve officials regarding potential future rate cuts. However, he noted a “growing chorus now of feeling like maybe this is where we should at least wait a cycle.” This sentiment contributed to the uncertainty in the markets.

In the broader financial markets, the S&P 500 closed Wednesday nearly unchanged, while the Dow Jones Industrial Average fell by approximately 0.2%. In contrast, the Nasdaq composite finished the day with an increase of nearly 0.6%.

Despite the slight downturn, some cryptocurrency analysts maintained a cautiously optimistic outlook. Alex Blume, founder and CEO of the crypto asset management firm Two Prime, remarked in an email to Fortune: “Easing monetary conditions are supportive of upward price momentum for BTC [Bitcoin] so long as the macroeconomic outlook doesn’t pose severe issues unforeseen by the market.”

Crypto Markets Experience Minor Dip Following Fed Chair's Remarks The decrease in cryptocurrency values on Wednesday was relatively minor compared to a significant flash crash that occurred on October 10, which resulted in over $19 billion in liquidations—the largest event of its kind tracked by the crypto analytics company CoinGlass.

This dramatic crash was linked to President Donald Trump's announcement of a potential 100% tariff on China, which led Bitcoin to lose more than $200 million in market capitalization and plummet nearly 10% in value. Ethereum suffered an even steeper decline, falling almost 14%.

Navigating Greenhushing: Clean Energy Progress Amidst Challenges In the days following the flash crash, Trump softened his stance, stating on Truth Social: “Don’t worry about China, it will all be fine! The U.S.A. wants to help China, not hurt it!!!” This change in tone contributed to a stabilization in the markets, including cryptocurrency valuations.

Since the October 10 crash, Bitcoin has largely traded around the $110,000 mark, with Ethereum remaining close to $4,000. Traders are now looking forward to a pivotal meeting scheduled for Thursday between Trump and Chinese President Xi Jinping, which could further influence market dynamics.

Thomas Perfumo, a global economist at crypto exchange Kraken, emphasized the importance of macroeconomic factors in shaping the current cryptocurrency cycle. He noted in an email to Fortune: “The fluctuating macroeconomic backdrop is the dominant driver of this crypto cycle.” He added, “While the market is stabilizing after the October 10 liquidation event, this ‘reset’ event certainly reduced short-term risk tolerance.”

As the crypto markets navigate these changes, investors remain attentive to how macroeconomic conditions may evolve in the coming weeks.

This article originally appeared on Fortune.com