Cryptos continue to pare losses ahead of Fed decision

If all goes according to plan during tomorrow’s Fed rate decision announcement, risk-on sentiment could be back

article-image

Shizume/Shutterstock and Adobe modified by Blockworks

share

Bitcoin and ether continued to pare gains Tuesday while stocks trended upward ahead of Wednesday’s Federal Reserve decision. 

Bitcoin posted mild losses Tuesday afternoon, positioning the largest crypto more than 5% lower over the past five days. Ether was trading around 2.3% lower Tuesday, also extending a mild selloff that started Monday. 

Both cryptos managed to stay above key levels, though, with bitcoin (BTC) hovering around $41,000 and ether (ETH) sitting just below $2,200. 

In the altcoin space, Solana, after increasing more than 22% in three days earlier this month, also cooled down Tuesday. The rally, spurred by Solana-based liquid staking protocol Jito’s governance token airdrop last week, appears to have cooled. 

Jito’s JTO, which debuted at a price of $1.20 per token, gained as much as 261% last week before dipping to around $2.92 Tuesday. 

Read more: What to know about Jito’s $165M JTO airdrop

Layer-1 protocol Aptos’ native token (ATP) soared as much as 17% Tuesday as 24.8 million, or 8.9% of its total supply, was unlocked. ATP’s market capitalization jumped more than 15% Tuesday to around $2.5 billion. 

Last month, when Aptos unlocked the same amount of tokens, ATP’s price plummeted to a low of $6.70. 

Aptos, which launched in October 2022, saw an increase of more than 200% in transactions between the second and third quarters of 2023, the blockchain said in a November 2023 update

What to watch this week 

Equities were modestly in the green again Tuesday, with the Nasdaq Composite and S&P 500 indexes posting gains of 0.5% and 0.3%, respectively. 

Traders are anticipating the Fed to keep interest rates where they are and extend its current forward guidance Wednesday. They also expect the central bank to update its expectations to place interest rates at 4.876% by the middle of 2024. If all goes according to plan it should push prices higher, analysts say. 

“As long as [Fed Chair Jerome] Powell isn’t too hawkish during the press conference, this outcome would likely spur a modest rally in stocks and could key a rally into year-end,” Tom Essaye, founder of Sevens Report Research, said. “To be clear, this outcome wouldn’t introduce anything new but it would remove the risk of a hawkish surprise and allow momentum to carry stocks higher into the end of the year.”


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

recent research

Research Report Templates.jpg

Research

In this report, each analyst on the Blockworks Research team lays out their highest conviction thesis for 2025.

article-image

Odds of an interest rate cut later this month are all but out the window

article-image

Exploring the drama surrounding a shiny new stablecoin

article-image

Asset Reality’s Aidan Larkin explains how the US government offloads bitcoin

article-image

We’re talking about FTX here, so we could have anticipated that things wouldn’t go as smoothly as planned

article-image

Half the surveyed advisers still consider regulatory uncertainty the top hurdle for future crypto investments

article-image

One key driver behind talk of a swift end to this cutting cycle is around surprisingly stubborn inflation