Bitcoin, Ethereum, and XRP prices crashed sharply as hopes for imminent Federal Reserve rate cuts faded, leading to nearly $1 billion in liquidations across the crypto market in mid-November.
The rate cut speculation shook crypto sentiment, highlighting market dependency on macroeconomic policy, and prompted significant asset value fluctuations while intensifying institutional risk management strategies.
Bitcoin, Ethereum, XRP Hit by Fed Rate Speculation
Recent cryptocurrency losses for Bitcoin, Ethereum, and XRP stem from diminished Federal Reserve rate cut expectations. Hopes for a December reduction stood at 40-50%. This uncertainty has led to heightened market volatility. Market analysis insights from Santiment feed
Leading players, including institutions and investors, are shifting strategies. Institutional buyers are reducing risk exposure, while MicroStrategy’s large Bitcoin holdings face valuation challenges. The decline has continued unabated, impacting market sentiment significantly.
Nearly $1 Billion Liquidated Amid Crypto Decline
The precipitous drop in cryptocurrency values has created nearly $1 billion in liquidations, as reported by Bitget. Short-term investors are exiting, while long-term holders accumulate assets, hoping for market recovery.
Experts, such as Samson Mow, predict a stronger future market as coins transition to convicted holders. Matt Hougan emphasizes the robust fundamentals, including institutional involvement and regulatory progress, anticipating recovery by 2026. “The underlying fundamentals are just so sound. Institutional investment, regulatory progress, stablecoins, tokenization—those forces are too big to keep down. So I think 2026 will be a good year.”
Fed Policy Reversals Influence Crypto Volatility
Federal Reserve policy changes regularly affect crypto. In September 2025, rate cut expectations led to crypto rallies. The current market instability appears linked to the reversal of these expectations, reflecting historical volatility trends.
Samson Mow suggests the current shake-up could pave the way for a stronger market by 2026, echoing previous trends where substantial buying occurred after initial market contractions. Analysis points to the potential for future stabilization. “These are not Bitcoin buyers from first principles, but rather speculators that follow the news. Rotation of coins to more convicted holders sets the stage for a stronger market in 2026.”
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