- Bitcoin fell below $111,000 after hawkish remarks from Fed Chair Jerome Powell.
- Powell said a rate cut in December is “not a done deal.”
- Major cryptocurrencies such as Ethereum, XRP and Solana also posted losses.
Bitcoin and the broader cryptocurrency market plunged after Federal Reserve Chair Jerome Powell signaled that a long-anticipated rate cut in December was not guaranteed, reversing market expectations that had priced in further easing.
The hawkish tone spooked investors immediately, pushing Bitcoin below a key support level and triggering a widespread sell-off across digital assets.
Although the Fed did lower its policy rate by a quarter point as expected, Powell’s comments on the future path of monetary policy became the dominant driver of the negative market reaction.
Powell dampens hopes for a December rate cut
At the conclusion of the Federal Open Market Committee (FOMC) meeting, Powell announced a 25 basis point reduction in the policy rate to a range of 3.75%–4.00%.
He quickly tempered market optimism by taking a cautious stance on future steps, stating that a December cut is “not a done deal.”
Powell explained that the Fed needs more economic data, especially after a recent government shutdown that blurred key indicators.
“We may need to slow the pace of policy adjustments. I hope to have more data by December,” he said at the press conference.
He also revealed a growing split within the committee.
“More and more Fed members want to delay rate cuts,” Powell added. “After two consecutive rate reductions, some members are taking a wait-and-see approach. The view that we should wait at least one cycle is spreading.”
Bitcoin leads a broad market dive
The market response to Powell’s unexpected caution was swift and decisive.
Bitcoin, which had been trading steadily around $113,000 before the press conference, dropped below its $110,000 support shortly after his remarks and hit an intraday low near $109,000.
By Thursday, the token was still struggling around $110,000, down roughly 2% from the previous day.
The weakness rippled across the crypto ecosystem.
According to CoinMarketCap, other major cryptocurrencies also registered notable losses:
- Ethereum (ETH) fell 1.93% to $3,899.87.
- XRP declined 2.74% to $2.53.
- Solana (SOL) dropped 1.04% to $192.37.
A silver lining: Fed ends quantitative tightening
Powell’s press conference was not entirely hawkish. He also formally announced the end of the Fed’s asset reduction program, known as Quantitative Tightening (QT), a move that could increase liquidity in the financial system.
“We have decided to end QT as of December 1,” Powell said, noting that the Fed’s balance sheet had contracted by $2.2 trillion over three and a half years.
“We now believe we are close to having ample reserves,” he added, signaling a shift toward balance-sheet normalization.
With the Fed behind them, all eyes turn to the US–China summit
With the Fed’s immediate policy path clarified, investors are shifting their attention to the next major potential catalyst: the summit between the United States and China.
After the crypto market’s sell-off, traders are looking to the meeting between U.S. President Donald Trump and Chinese President Xi Jinping as a possible source of positive developments that could spark a recovery.
The high-profile meeting is scheduled for Thursday morning at the “Naraemaru” facility on the Gimhae Airport airbase.