Ethereum Surges 7% Ahead of FOMC Meeting

Ethereum (ETH) surged by nearly 7% in the past 24 hours, leading the gains among major cryptocurrencies as traders eagerly await the outcome of the Federal Open Market Committee (FOMC) meeting. The FOMC meeting is a crucial event for traders, as it often sets the tone for monetary policy and can significantly impact market sentiment. With the $80,000 support level for Bitcoin in focus, traders are closely monitoring the situation, as any deviation from this level could trigger a wave of buying or selling activity.

The recent price increase in Ethereum is part of a broader trend of significant gains seen in several major cryptocurrencies. Ethereum, in particular, has seen its value rise to $4,200, marking a 7% increase from the previous day. This surge in price is indicative of the growing interest and investment in the cryptocurrency market, as well as the potential for further gains in the coming days.

The FOMC meeting is expected to provide clarity on the future direction of monetary policy, which could have a significant impact on the cryptocurrency market. Traders are closely watching for any indications of changes in interest rates or other monetary policies that could affect the value of cryptocurrencies. The $80,000 support level for Bitcoin is a key indicator of market sentiment, and any movement above or below this level could signal a shift in the market's overall direction.

Bitcoin (BTC) rose 2% and remained steady under $84,000 in Asian evening hours ahead of the FOMC, where traders expect rates to be held steady. The $80,000 mark remains one to be watched, as a break below would mean a critical support level vanishes. The widely-watched ETH/BTC ratio - or the trading pair of ether against bitcoin - rose from 0.23 to 0.24 since Asian morning hours, indicative of a bump in demand for riskier ETH versus the perceived safety of bitcoin.

Ether rose on no immediate catalyst, but the mothership network has technical catalysts in the making. The Pectra upgrade, Ethereum's next major update, is currently in testing and aims to improve scalability, staking, and user experience with over 20 EIPs, including EIP-7702 (smart account functionality) and EIP-7251 (raising validator staking limits to 2,048 ETH). Testing began on Holesky in February 2025, followed by Sepolia in March, but faced challenges like transaction processing issues due to client incompatibilities. A new testnet, Hooli, launched on March 17, with Pectra testing scheduled for March 26. If successful, mainnet deployment is expected in late April or early May 2025.

“BTC has found some support at the $80K, but that seems tenuous at best amid broader macro weakness,” traders at Singapore-based QCP Capital said in a broadcast message. “We won’t attempt to call the exact moment when the music stops, but in the short term, we struggle to identify meaningful tailwinds to reverse this rout.”

“We will be watching closely for any dovish shifts, particularly on growth and inflation expectations. Given that it will take months for the impact of tariffs to ripple through the economy, we expect the Fed to remain in “wait-and-see” mode,” QCP added.

Meanwhile, gold broke above $3,000 to new highs earlier Wednesday, leading to some eyeing an inverse correlation of the yellow metal with bitcoin. “Despite its historical correlation with gold as a macro hedge, Bitcoin's current divergence—falling while gold rises—suggests it's acting more like a risk asset, influenced by Fed policy uncertainty, profit-taking, and a shift to traditional safe-havens,” Ryan Lee, Chief Analyst at Bitget Research, told in a Telegram message.

“The FOMC outcome could either trigger a recovery if dovish or deepen the correction if hawkish, with bitcoin's short-term trajectory tied to broader economic signals rather than solely reinforcing its "digital gold" role,” Lee added.