On Tuesday, Cardano’s ADA and XRP experienced significant losses, leading the decline among major cryptocurrencies as traders await the outcomes of the upcoming Federal Reserve (FOMC) meeting. While rates are anticipated to remain unchanged, the comments from Fed Chair Jerome Powell could provide crucial insights on potential future market positioning.
Bitcoin (BTC) managed to maintain its position above $94,000 after a brief dip below that level on Sunday, continuing its range-bound behavior that has characterized recent trading sessions.
In the past 24 hours, ADA’s price dropped nearly 4%, with XRP reflecting similar declines. Meanwhile, Ether (ETH) experienced a nearly 1% fall, while BNB Chain’s BNB recorded a slight rise of 1.3%. In contrast, memecoin dogecoin (DOGE) saw a 2% decrease.
The CoinDesk 20 (CD20) index, which tracks the largest tokens by market capitalization, saw a more than 1.8% decline overall.
On a positive note, several DeFi tokens, including AAVE, Curve’s CRV, and Hyperliquid’s HYPE, have witnessed increased demand over the past week. Analysts suggest this could indicate a shift in trader interest towards projects that offer real utility and yield potential.
“As memecoins fall out of favor, traders are turning to projects with stronger fundamentals and token economics,” remarked Kay Lu, CEO of HashKey Eco Labs, in a Telegram message. Lu highlighted that “DeFi ecosystems are benefitting from this pivot, particularly as Bitcoin shows decreased volatility and ongoing macroeconomic uncertainty. We’re encouraged to see the DeFi trend continue, as it positions crypto as a hedge against economic uncertainty.”
Among the top 100 tokens, HYPE has been a standout performer, leading gains with a remarkable 72% surge over the past week, while AAVE and CRV also saw gains of up to 40%.
Focus on Powell’s Commentary
The attention of traders across both crypto and traditional finance markets is on this week’s FOMC interest rate decision, with a consensus expectation for a pause on rate hikes. Nonetheless, ongoing concerns related to inflation, tariffs, and U.S.–China trade tensions have kept many market participants on high alert.
“We don’t expect the FOMC to trigger significant market movements,” noted Augustine Fan, Head of Insights at SignalPlus, via Telegram. “The outcome seems almost like a coin flip. The crypto market is likely to take cues from broader economic indicators, such as earnings growth and the implications of recent trade policies.”
Recent strength in the stock market suggests that investors are predicting only an 8% risk of a mild recession, based on historical drawdown models. This is in contrast with more bearish signals emerging from bond markets and prevailing macroeconomic forecasts, Fan added.
Adding to the complexities, last week, President Trump announced that there are no immediate plans for talks with China, which has dampened hopes for progress in U.S.–China trade negotiations. Nevertheless, the potential for separate trade agreements has helped sustain overall risk sentiment, as highlighted in a report.
