Quick Takeaways
- Bitcoin dropped over $2,000 after the Fed’s hawkish meeting, falling from $66,400 to $64,000.
- New Fed Chair Kevin Warsh signaled a focus on price stability, surprising investors and dampening hopes for easy money policies.
- The market saw over $400 million liquidated in 24 hours, mostly from long positions, with nearly 100,000 traders wiped out.
- Altcoins like Ethereum, BNB, and XRP also declined sharply, reflecting widespread sell-offs and increased liquidation activity.
$400 Million Wiped Out in Hours as Bitcoin Crashes After FOMC and Warsh Speech
Market Reaction to Federal Reserve Meeting
Bitcoin’s price dropped sharply after the latest Federal Open Market Committee (FOMC) meeting and a speech by new Fed Chair Kevin Warsh. The cryptocurrency, which was over $66,000 earlier today, fell below $64,000 within minutes. The decline happened right after the Fed decided to keep interest rates unchanged for the fourth straight meeting.
Warsh’s comments surprised many investors because he adopted a hawkish tone. Unlike expectations that he would follow a more lenient approach, Warsh emphasized efforts to control inflation. Jeffrey Gundlach, CEO of DoubleLine Capital, told CNBC that Warsh wanted to focus on price stability. He explained Warsh’s stance means the Fed is not likely to cut rates soon. This shift in language signaled less support for easy money policies. As a result, stocks and cryptocurrencies reacted negatively, with Bitcoin experiencing steep declines.
Impact on Cryptocurrency Prices and Liquidations
Following Warsh’s speech, Bitcoin continued to slide further. It briefly recovered from around $65,000 but then plunged again to $64,000. Most alternative cryptocurrencies, or altcoins, also suffered. Ethereum fell more than 3%, dropping below $1,740. BNB lost the $600 support level, and XRP fell below $1.20.
This rapid price movement caused a wave of liquidations. Data from CoinGlass estimates over $400 million in positions were wiped out in the past 24 hours. Nearly half of this happened in just the last four hours. Long positions—bets that prices would rise—accounted for most of the losses, totaling about $280 million. In the past hour alone, $79 million of liquidated positions came from longs.
Nearly 100,000 traders lost their positions during this crash. The largest liquidation on Binance involved $5 million. Such sell-offs reflect heightened market volatility driven by concerns over future Federal Reserve policies and geopolitical developments.
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Disclaimer
This content is for informational and entertainment purposes only and does not constitute financial or investment advice. Cryptocurrency is highly speculative and carries significant risk, including the potential loss of your entire investment. This information may be outdated or incomplete. Do not make financial decisions based on this information. Consult a licensed financial advisor before investing. This site does not offer, sell, or advise on cryptocurrency, securities or other regulated financial products in compliance with SEC and applicable laws. Please do your own research and seek professional advise.
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