Bitcoin News Today: Altcoins Drop 3%-10% as Crypto Market Reacts to Fed Rate Hike Fears

The crypto market experienced heightened volatility ahead of the U.S. Federal Open Market Committee’s (FOMC) rate decision in late July 2025, with altcoins and memecoins dropping between 3% and 10% as traders adopted a risk-off stance [1]. Tokens such as Bonk, Pepe, and Dogecoin were among the hardest-hit, with Bonk falling 10% and Dogecoin losing 3% within a 24-hour period [1]. This sell-off was attributed to macroeconomic uncertainty and the anticipation of potential U.S. monetary policy shifts [1].

Bitcoin, while briefly dipping below $117,000 on July 29, managed to recover above $118,000 by press time [1]. However, the broader altcoin market saw a significant decline in capitalization, losing approximately $50 billion in value over 48 hours, shrinking from $1.57 trillion to $1.52 trillion [1]. The reduction in market capitalization was mirrored by a decline in open interest (OI) across major crypto exchanges, which dropped from $101 billion to $97 billion [1]. Specifically, combined OI in major altcoins such as Ethereum (ETH), Solana (SOL), Ripple (XRP), and Dogecoin (DOGE) fell from $42.5 billion to $41 billion, with Ripple alone experiencing a $2 billion decline in OI over the past week [1].

Among layer 1 blockchain tokens, Binance Coin (BNB) fell 3%, Cardano (ADA) dropped 2.6%, and Solana (SOL) lost 2.2% [1]. These movements reflect the broader caution in the market, particularly in the lead-up to major macroeconomic announcements.

Despite the recent downturn, crypto strategist Matt Mena of 21Shares expressed a cautiously optimistic outlook, noting that a potential 25 basis points rate cut in September—supported by softer-than-expected inflation data—could trigger a bullish rally in the crypto market [1]. Mena highlighted that the release of the White House’s crypto policy report on July 31 could also serve as a catalyst, potentially leading to a price discovery phase for Bitcoin and even pushing it toward $130,000 or $150,000 by the end of September, particularly if the report includes the announcement of a strategic Bitcoin reserve [1].

The market is now closely watching the Personal Consumption Expenditures (PCE) report and the White House’s crypto policy developments, both of which could influence the direction of Bitcoin and altcoins in the coming months [1]. Analysts emphasize the importance of these upcoming data points in shaping market sentiment, especially as investors seek clarity on the Fed’s stance and the regulatory landscape for digital assets [1].

Source: [1] Bitcoin May See Recovery Potential Amid Fed Rate Decision and Upcoming Inflation Data

(https://en.coinotag.com/bitcoin-may-see-recovery-potential-amid-fed-rate-decision-and-upcoming-inflation-data/)