- Fed rate cut sparks crypto volatility, with $240M in liquidations led by long positions.
- Triple witching history show a possible 5–8% Bitcoin drop, 15–20% altcoin declines.
- Peter Schiff warns Fed cuts may trigger QE, risk dollar status, and fuel gold, silver rally.
The crypto market tightened this week as traders positioned ahead of the Federal Reserve’s expected rate cut. Bitcoin stalled near $116,000, meeting resistance that triggered selling pressure. Altcoins such as XRP, Solana (SOL), and Dogecoin (DOGE) fell harder, with analysts warning volatility could increase before policy clarity arrives.
Why it matters: Into event risk, derivatives drive spot. When funding, open interest, and liquidation clusters stack, small moves snowball.
Liquidations show the pressure point
In the past 24 hours, crypto liquidations reached about $240M, with ~$176M in long liquidations (leveraged futures positions), classic “sell-the-news” positioning after last week’s squeeze. That mix tells you longs were leaning in; the unwind hit alts harder than BTC.
Related: August CPI 2.9% and Core 3.1% Put the Fed in a Bind; Futures Still Favor a Cut
Triple witching adds a volatility kicker
Since 2000, the week after triple witching has averaged -1.17% for the S&P 500. If that seasonality bites again, desks map BTC down ~5–8% with alts 15–20% given higher beta and thinner books. That’s the risk case the market is handicapping into the Fed.
Why it matters: Equity flows bleed into crypto via risk-parity and macro CTA buckets; stress there often shows up in perp books here.
Schiff Warns of Consequences
While many traders anticipate that rate cuts could fuel renewed demand for risk assets, economist and investor Peter Schiff argued that the decision represents a “huge mistake.”
In a post on X, he pointed to rising prices in gold and silver as indicators that markets are already pricing in the policy change. Silver recently crossed $42, while gold neared record highs.
The policy track that markets are pricing
Schiff predicts that the shift will not stop at a single reduction but could trigger a pattern of cuts combined with quantitative easing measures. He stated that definitive yield curve control might follow, with big implications for the U.S. dollar’s role as the global reserve currency.
“Ever since Alan Greenspan rescued the stock market after the 1987 crash, the Fed has made a series of growing bad monetary policy mistakes,” Schiff wrote. He described the current environment as potentially the most damaging yet.
The outcome of the Federal Reserve’s decision could impact both traditional and digital markets. With Bitcoin struggling to hold momentum above key levels and altcoins showing retracements, traders now await confirmation of whether rate relief will support risk assets, or deepen existing market corrections.
Related: Fed Rate Cut Bet, Policy Clarity Drive Capital Rotation Into Altcoins
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