The cryptocurrency market is feeling the pressure as economic uncertainties continue to loom, despite recent interest rate cuts and optimism surrounding US-China trade negotiations. The US Treasury Secretary, Scott Bessent, indicated that the US will relax restrictions on Chinese companies’ access to sensitive technology, a move made in exchange for China suspending its export controls on rare earth minerals, crucial for electronics and military applications. This announcement comes amid a backdrop of easing trade tensions, which typically supports positive price movements in the crypto markets.

Nonetheless, uncertainty persists as revealed by the recent FOMC meeting and comments made by Jerome Powell, where he highlighted discord among committee members regarding a potential December rate cut. This has caused market instability, leading to a decline in crypto prices.

Despite the Fed’s cessation of quantitative tightening—which restricts liquidity—the delay between stopping QT and initiating quantitative easing may see further downturns in crypto values until financial liquidity is restored.

Crypto Liquidations Reach Over $1 Billion

The aftermath of the FOMC meeting saw over $1.1 billion in liquidations, with Bitcoin (BTC) prices dipping below $107,000, a critical support level. Amidst these developments, investors appear anxious about the future direction of monetary policy as the Fed has demonstrated no certainty in its approach to interest rates moving forward.