Are Rate Cuts Off the Table? Crypto Hit by Selling Spree as Even Whales Turn Away

▲ Bitcoin (BTC), decline, bear market / AI-generated image

The U.S. Federal Reserve’s hawkish stance has struck the digital asset market, rapidly cooling investor sentiment as major cryptocurrencies plunge across the board.

According to crypto-focused outlet CoinGape on Feb. 19 (local time), the release of the minutes from the Federal Open Market Committee (FOMC) meeting in January triggered a broad sell-off across the market, including Bitcoin (BTC), Ethereum (ETH), and XRP. The minutes signaled strong concerns that inflation may not slow as quickly as expected and indicated that additional rate hikes could be considered if necessary, intensifying risk aversion toward speculative assets.

Fed officials reaffirmed their cautious stance, stating they would not rush to cut interest rates until they gain greater confidence that inflation is sustainably moving toward their 2% target. They specifically warned of the risks of premature rate cuts and left the door open to further rate hikes if inflation remains persistent, dampening market expectations. Heightened macroeconomic uncertainty has restricted liquidity in the crypto market, including Bitcoin, adding significant downward pressure on prices.

Immediately after the release of the minutes, the total cryptocurrency market capitalization fell about 1.52% to approximately $2.31 trillion. Bitcoin dropped 1.66% to $67,047, while Ethereum and XRP slid 2.06% and 4.02%, respectively, as selling intensified. In the futures market, more than $224 million in liquidations occurred over the past 24 hours, with $164 million of that coming from long positions that had bet on price increases.

In addition to macroeconomic concerns, rising geopolitical tensions, including the possibility of conflict between the United States and Iran, have further weighed on the market. As investors shift toward safe-haven assets, open interest in the crypto market declined by 0.71%, signaling visible capital outflows. While attention is focused on the moves of major holders such as Strategy, institutional investors are also concentrating on risk management amid increased volatility, leading to a noticeable slowdown in new capital inflows.

The cryptocurrency market is expected to remain volatile for the time being, reacting sensitively to the Fed’s monetary policy direction and changes in the global geopolitical landscape. Unless uncertainty surrounding interest rate cuts is resolved, investors are likely to maintain a defensive stance. The market is expected to consolidate within a range, building energy as it awaits a strong catalyst to ensure macroeconomic stability and support a meaningful recovery in real demand.

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