The Federal Reserve delivered a widely anticipated 25-basis-point rate cut, lowering the federal funds target range to 3.75%-4.00% following its Oct. 28-29 meeting, Chair Jerome Powell confirmed on Wednesday.
The move, aimed at easing financial conditions, came as risk markets reeled from a wave of volatility that had already begun hours earlier.
In the run-up to the decision, the crypto market saw heavy turbulence ahead of the Federal Reserve’s rate decision, and this time, the experts called it right. Roughly $100 million in crypto positions were liquidated in the hour leading up to the announcement, with $55 million tied to Bitcoin (BTC) alone, according to CoinGlass.
A sticker depicting Federal Reserve Chairman Jerome Powell holding a sign that reads “Buy Bitcoin” on a wall.
Total 24-hour liquidations surpassed $550 million, signaling a wave of forced selling as volatility surged across leveraged markets. Traders appeared to have positioned defensively ahead of the Fed’s policy statement at 2:00 pm ET, anticipating a move that could pressure risk assets.
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Derivatives trader Killa (@KillaXBT) was among those who warned that market dynamics had shifted before the meeting:
“Rate cuts are priced in & we are now retracing into FOMC. If we fill & hold the CME gap, I would avoid shorts completely. If we drop below $108K, we will look for shorts to sub $100K.”
In other words, Killa is warning that Bitcoin remains range-bound. A move above the CME gap could signal renewed momentum, but failure to hold $108,000 risks accelerating losses to five figures.
If Bitcoin drops to $108,000, Killa said they are looking to short below $100,000. So far, Bitcoin has done neither – holding above the $108K threshold while failing to regain upside momentum.
Many traders have adopted a wait-and-see stance, wary of sudden volatility around the Fed’s rate decision.
Adding context to this cautious tone, crypto analyst Ali Martinez (@ali_charts) had flagged recurring negative patterns to FOMC announcements this year.
“Out of the six FOMC meetings held so far, five have coincided with corrections, while only one resulted in a short-term rally,” he wrote, pointing to pullbacks ranging from –6% to –27%.
Ali’s data reinforced the idea that Bitcoin tends to sell off around FOMC events, a trend that continued following Wednesday’s 25-basis-point cut.
Gold advocate Peter Schiff (@PeterSchiff) also seized on the weakness, arguing that Bitcoin’s decline, even amid a gold pullback and a rising Nasdaq, exposes its fragility as a “safe haven” asset.
Schiff’s remarks echoed broader market skepticism that Bitcoin can withstand tightening liquidity or changing macro signals from the Fed.
Bitcoin drops right after Fed’s FOMC decision
At the time of writing, BTC traded around $109,674, down 4.4% in 24 hours, with a market cap of $2.18 trillion, marking a sharp drop right after the meeting. And as the dust settles, one thing seems clear: the traders who went short before the FOMC decision read the market right.
This story was originally reported by TheStreet on Oct 29, 2025, where it first appeared in the Federal Reserve & FOMC News section. Add TheStreet as a Preferred Source by clicking here.