Crypto Market Stagnates as Fed Holds Rates at 4.25%–4.50%

The crypto market experienced a period of stagnation following the Federal Reserve's decision to maintain interest rates at 4.25%–4.50%. This move was driven by ongoing uncertainty surrounding inflation and economic policy, leading to cautious trading behavior across the market. Bitcoin and Ethereum saw slight declines, with Bitcoin trading around $104,900 and Ethereum slipping to $2,526. Altcoins displayed mixed performance, with some showing slight gains while others continued to lose value.

Federal Reserve Chair Jerome Powell confirmed that the central bank would keep interest rates unchanged, citing the U.S. economy's continued absorption of inflationary pressures. Powell highlighted that rising tariffs are contributing to price increases, particularly in consumer tech and imported goods. He emphasized that while economic growth remains slow but steady, the Fed's decisions will continue to be data-dependent. Powell also acknowledged internal divisions within the Fed regarding potential rate cuts this year, which has left investors in a holding pattern.

Powell expressed concerns about the persistence of inflation and global risks, noting that geopolitical tensions and oil prices are complicating forecasting efforts. He also mentioned that reduced funding to agencies like the Bureau of Labor Statistics could impact data accuracy, suggesting that the Fed might be proceeding without full visibility. This uncertainty has contributed to the market's cautious stance, with traders awaiting clearer economic signals before making significant moves.

The total crypto market cap stands at $3.41 trillion, with $214 million in 24-hour liquidations. The Fear & Greed Index is at 57, indicating moderate optimism. However, analysts suggest that a stronger market move may not occur until macro data provides clearer signs of easing inflation or a policy shift. Despite some developments, such as Coinbase's stablecoin payment feature for ecommerce platforms and Lion Group's $600 million facility to boost its HYPE token treasury strategy, the market remains cautious, awaiting a catalyst to drive significant price action.

Small-cap gainers such as GOUT, FORT, and BID led today’s charge, posting double-digit growth. Forta Network and Ratio1AI also saw strong upticks. However, analysts caution that broader trends remain subdued, and most altcoins remain range-bound. The market's overall sentiment is one of wait-and-see, with traders closely monitoring economic data and policy developments for clearer direction.