US Fed Signals Rate Cut: Crypto Shorts Liquidated

Market Reactions to Fed Announcements

Nearly $450 million in crypto shorts were liquidated recently as the market reacted to potential indications of US Federal Reserve rate cuts. The action followed signals from Fed Chair Jerome Powell about possible changes in monetary policy course.

Monetary policy is not on a preset course. FOMC members will make these decisions, based solely on their assessment of the data and its implications for the economic outlook and the balance of risks. We will never deviate from that approach. – Jerome Powell, source

Impact on Ethereum and Bitcoin Prices

This market shift resulted in Ethereum’s price surging by approximately 9% and BTC reaching over $116,000. The liquidation totaled $310 to $446 million, with Ethereum and Bitcoin being the most impacted assets.

The Fed’s rate cut hints had broad financial implications, boosting market volumes by 15% to $189.7 billion. Ethereum saw significant trading with over $147 million shorts liquidated, tripling Bitcoin’s figures, causing a marked market shift.

Historical Trends and Future Implications

This market activity aligns with historic short squeezes following macroeconomic statements, which often disrupt risk-on asset classes. Institutional and treasury funds remain active, with continued accumulation amid market volatility.

Looking forward, these developments suggest potential institutional interest and increased trader optimism. Historical trends support the possibility of prolonged market volatility, indicating a dynamic trading landscape following Fed policy changes.