Why is Crypto Market Going Down Today?

The crypto market is sliding as investors brace for the Federal Reserve’s policy decision later today. The total market capitalization has dropped by more than 2%, sitting near $3.81 trillion, while the Crypto Fear and Greed Index has slipped to 39.

Markets Turn Red Before the Fed’s Rate Decision

The U.S. Federal Reserve is expected to announce its second interest rate cut of 2025 later today, with markets pricing in a 98% chance of a 0.25% reduction. While a rate cut is usually bullish for risk assets like Bitcoin and Ethereum, traders are holding back ahead of Fed Chair Jerome Powell’s comments on quantitative tightening (QT).

His tone will determine whether this cut signals a pause in the tightening cycle or the beginning of a longer easing phase. A dovish outlook could trigger a strong rebound, while a hawkish statement may deepen the current sell-off.

Bitcoin Slips, Ethereum and XRP Follow

Bitcoin is trading around $112,600, down 2.5% in 24 hours. BTC is still holding within a wide range between $105,000 and $115,000. 

Ethereum has fallen to $3,979, down 4.2% on the day. XRP, meanwhile, trades near $2.63 after a 1.2% dip, outperforming Bitcoin during the latest pullback. Despite short-term weakness, XRP continues to attract interest ahead of a potential ETF approval window between now and mid-November.

Broader Crypto Market Feels the Pressure

Most altcoins are also under pressure. Solana dropped to $200, Cardano slipped to $0.64, and Dogecoin declined more than 3%. The CMC20 Index, which tracks the top 20 cryptocurrencies, fell 2.7%.

However, some exceptions remain. Hedera (HBAR) surged nearly 18% after the debut of its spot ETF.

What to Watch Next

The Fed’s announcement later today will likely dictate the market’s next major move. If Powell signals continued rate cuts and easing liquidity conditions, Bitcoin and Ethereum could rebound sharply. On the other hand, any sign of extended tightening may lead to deeper corrections before recovery resumes.