Crypto Slight Correction: BTC at $122,000, Focus on Fed Minutes
The crypto market corrected slightly on Wednesday, with Bitcoin retreating to the $122,000 range after hitting a new record above $126,000 earlier this week, amid a strengthening Dollar Index near 99 as the US shutdown entered its second week. Safe-haven flows into the dollar and persistently high yields dampened risk appetite, resulting in a temporary pause in the crypto rally.
On the back of the earlier rally, spot Bitcoin ETFs recorded inflows of around $1.2 billion on Monday—a level that historically often coincides with short-term peaks—while large leveraged liquidations briefly fueled volatility. Sentiment remains positive for the asset class, but the market is now more selective after its rapid surge to record highs.
Most altcoins also experienced extended declines on Wednesday amid broader risk-off sentiment. Ethereum, the world's number two cryptocurrency, fell 5.7% to $4,477.42. XRP, the world's number three cryptocurrency, fell 3.8% to $2.8727. Solana plunged 4.0%, while Cardano plunged 5.5%, and Polygon fell 4.7%. Among meme tokens, Dogecoin plunged 4.7%.
Looking ahead, focus shifts to the FOMC minutes and comments from Fed officials for clues on the pace of interest rate cuts. The market is currently pricing in a 95% chance of a 25 bps cut in October and >80% in December, which is generally positive for medium-term risk assets, but a strengthening dollar has the potential to curb the crypto rally in the short term. Meanwhile, altcoin performance has been mixed; BNB is said to stand out amidst the broader market cooling.
Source: Newsmaker.id
