Ethereum News Today: Fed Policy, $175M Token Unlocks, Starknet Upgrade Drive Crypto Volatility This Week

The cryptocurrency market faces a confluence of critical developments this week, with the U.S. Federal Reserve’s policy decision, a $175 million token unlock event, and a major upgrade to Starknet’s protocol poised to drive volatility and reshape trading dynamics. These interwoven catalysts have drawn significant attention from traders and analysts, who are assessing their potential to influence Bitcoin, Ethereum, and broader market sentiment.

The Federal Reserve’s Federal Open Market Committee (FOMC) meeting on Wednesday remains the week’s focal point. Policymakers are widely expected to maintain the current 4.25%-4.50% federal funds rate, aligning with market predictions that prioritize stability ahead of August trading [1]. However, the real market mover will be Chair Jerome Powell’s post-meeting press conference, where his remarks on inflation, employment, and forward guidance could sway digital asset prices. Historically, dovish signals from the Fed have bolstered risk-on assets by weakening the U.S. dollar, while hawkish tones have triggered safe-haven flows into traditional assets. With Bitcoin recently reclaiming key technical levels, Powell’s commentary will be scrutinized for hints of policy flexibility or tightening.

Simultaneously, the Ethereum network will experience a $175 million token unlock, primarily affecting projects like Jupiter, SUI, and Optimism. Jupiter’s 53 million tokens entering circulation could test its momentum following a 50% July rally, as early investors gain liquidity. SUI’s $108 million unlock, though representing less than 1% of its total supply, may create selling pressure if institutional holders rebalance portfolios. Optimism’s $21.5 million unlock could influence Layer 2 scaling narratives, given its position in the Ethereum ecosystem. While the immediate impact hinges on market absorption, the psychological weight of these unlocks—driven by fears of dumping—often amplifies short-term volatility.

Starknet’s V0.14.0 upgrade on Monday introduces technical enhancements that could reshape Ethereum’s Layer 2 landscape. The protocol’s shift to distributed sequencer architecture marks a pivotal step toward decentralization, a competitive edge in an increasingly fragmented scaling space. Faster block times (2 seconds) and pre-confirmed transactions aim to improve user experience and attract DeFi adoption. Such upgrades historically correlate with price movements, as market participants reassess the network’s utility and growth potential. Success could indirectly benefit Ethereum by reinforcing its appeal against Layer 1 alternatives, though technical hiccups during the transition could temper optimism [3].

The interplay between these events creates a complex environment. A dovish Fed outcome might initially buoy crypto markets, but the token unlock’s liquidity influx could offset gains. Conversely, hawkish signals might amplify downside risks, especially if the unlock coincides with risk-off sentiment. Starknet’s upgrade adds a technical, long-term variable: if the network’s performance aligns with expectations, it could reinforce Ethereum’s competitive positioning. Traders will monitor on-chain metrics, such as exchange inflows and gas usage, to gauge the unlock’s absorption and the upgrade’s real-world adoption.

As the week unfolds, the crypto markets will test their resilience to overlapping macroeconomic and technical catalysts. While the Fed’s decision sets the macro tone, the token unlock and Starknet upgrade offer immediate, tangible influences. The coming days will clarify whether these events reinforce a bullish narrative or expose vulnerabilities in the market’s trajectory.

Sources:

[1] [Fed Decision, $175M Token Unlocks, and Starknet Upgrade Set to Rock Crypto Markets This Week] [https://coinpaprika.com/news/the-week-ahead/]

[2] [ECB to Hold Rates in Response to US Trade Deal as EUR Gets Boost from Agreement] [https://www.fxstreet.com/analysis/ecb-to-hold-rates-in-response-to-us-trade-deal-as-eur-gets-boost-from-agreement-202507280949]

[3] [Trump Checks Off EU Trade Deal – Europe Response is Disappointment] [https://www.fxstreet.com/analysis/trump-checks-off-eu-trade-deal-europe-response-is-disappointment-202507280940]