Bitcoin News Today: Bitcoin holds $118K as FOMC nears; altcoins drop, BONK plunges 13% amid $60B market cap loss

Bitcoin’s price stabilized near $118,000 in the hours leading up to the Federal Open Market Committee (FOMC) meeting, signaling a temporary pause in the cryptocurrency’s recent volatility [1]. The move came amid broader market caution as investors anticipated central bank policy developments, which have historically influenced crypto markets. Meanwhile, the altcoin sector underperformed, with BONK experiencing a sharp 13% decline on the day, followed by TIA and SPX. ENA also saw a pullback after a recent rally, highlighting the fragility of momentum in smaller tokens [2].

The $118,000 level for Bitcoin marked a key support threshold, with the asset avoiding further downward pressure despite lingering macroeconomic uncertainties. Analysts noted that institutional activity had previously bolstered Bitcoin above this level, though recent price action suggested a lack of follow-through in bullish momentum ahead of critical macroeconomic data [3]. The Federal Reserve’s upcoming decision on interest rates is expected to play a pivotal role in shaping risk appetite across asset classes, with crypto markets often mirroring equity and bond market sentiment.

BONK’s sharp correction contrasted with Bitcoin’s relative stability, underscoring the divergent dynamics between the leading cryptocurrency and speculative altcoins. The token’s decline followed a period of elevated volume, raising questions about short-term positioning and liquidity pressures. While no direct correlation was cited between Bitcoin’s performance and BONK’s drop, the broader market’s risk-off tone contributed to a flight from higher-volatility assets.

The market’s focus on the FOMC meeting highlighted the interplay between traditional and digital asset markets. Historically, crypto prices have shown sensitivity to central bank messaging, particularly regarding inflation expectations and rate trajectories. However, the absence of immediate triggering factors—such as regulatory shifts or technical breakdowns—suggests the current stabilization could be short-lived, contingent on post-meeting policy signals.

The total crypto market cap has declined by $60 billion overnight and is down to $3.940 trillion on CG, reflecting ongoing investor caution. Bitcoin’s dominance over altcoins has risen to 59.6%, a sign of renewed interest in the largest cryptocurrency as risk-off sentiment intensifies. The broader altcoin market saw significant losses, with tokens like SUI, HBAR, and AVAX down by over 5% in the past day, while ENA, TAO, and ICP mirrored similar declines.

The FOMC meeting’s outcome remains a critical variable for crypto markets. While a rate cut is widely anticipated, the magnitude and forward guidance will shape investor sentiment. If the Fed signals prolonged dovishness, Bitcoin could retest $120,000 in the short term. Conversely, any hawkish surprises could trigger renewed selling pressure across the market. For altcoins, the path forward remains uncertain, with speculative tokens like BONK facing heightened liquidity risks in a low-volatility environment.

Sources:

[1] "Bitcoin Price Calms at $118K Ahead of FOMC Meeting, BONK Dumps Hard: Market Watch," CryptoPotato (https://cryptopotato.com/bitcoin-price-calms-at-118k-ahead-of-fomc-meeting-bonk-dumps-hard-market-watch/)

[2] "CryptoPotato - Bitcoin & Altcoins, Crypto News and Guides," CryptoPotato (https://cryptopotato.com/)

[3] "Bitcoin Price Nears $112K as Institutions Fuel Crypto Rally," Erudite (https://erudite.news/en/business/articles/10185****1752145497/bitcoin_nears_fuel_crypto_rally_institutional_reserve/?trending=bitcoin,crypto)