Bitcoin News Today: FOMC decision triggers $50B altcoin selloff as Bitcoin eyes $130K rally

The U.S. Federal Open Market Committee (FOMC) rate decision loomed as a key driver of risk-off sentiment in the cryptocurrency market, particularly affecting altcoins in the lead-up to the event [1]. Over the past 48 hours, the altcoin market shed approximately $50 billion in value, dropping from $1.57 trillion to $1.52 trillion [1]. Top-performing altcoins such as Binance Coin (BNB), Cardano (ADA), and Solana (SOL) declined by 3%, 2.6%, and 2.2%, respectively [1]. Ripple (XRP) also experienced a sharp contraction in Open Interest (OI), with over $2 billion wiped out in the past seven days [1].

Smaller-cap tokens were even more vulnerable to the sell-off. Bonk (BONK) dropped 10% in a 24-hour period, while Pepe (PEPE) and Dogecoin (DOGE) fell by 4% and 3%, respectively [1]. These declines occurred after Bitcoin (BTC) briefly fell to $116,950 on July 29 [1]. BTC has since rebounded to above $118,000, but altcoins remain range-bound as traders wait for the Fed’s decision.

The risk-off trend was further reflected in a decline in aggregated Open Interest, which fell from $101 billion to $97 billion across all exchanges and crypto assets in the same period [1]. This suggests that some market participants are adopting a more defensive stance, anticipating potential volatility.

Despite the bearish short-term sentiment, 21Shares crypto research strategist Matt Mena expressed a cautiously optimistic outlook. According to Mena, the Fed is expected to maintain rates in July, but a 25 basis point rate cut in September is priced in at a 61.6% probability [1]. He also noted a 42.9% chance of two cuts by the end of the year [1]. Mena further suggested that a soft PCE inflation reading and a substantive White House crypto report could act as bullish catalysts for Bitcoin [1].

According to Mena’s analysis, if the White House report includes a strategic Bitcoin reserve proposal, BTC could reclaim $120,000 and potentially reach $130,000 by the end of September [1]. These projections, however, are speculative and contingent on the outcomes of the upcoming macroeconomic and regulatory developments.

As the market awaits the FOMC decision and inflation data on July 31, crypto remains in a holding pattern, with altcoins yet to establish a clear direction. The White House report is expected to provide further clarity on the regulatory landscape, which could influence risk appetite and capital flows in the near term.

Source: [1] FOMC rate cuts loom: Altcoins lose $50B, but Bitcoin eyes $130K (https://ambcrypto.com/fomc-rate-cuts-loom-altcoins-lose-50b-but-btc-eyes-130k/)