Crypto Market Stays Cautious as Powell Warns Tariffs Could Fuel Inflation

Bitcoin is holding steady around $113,000, while Ethereum trades around $4,200.

The crypto market remains cautious despite last week’s rate cut, with analysts noting growing impatience and bearish sentiment among retail investors.

Data from The Defiant’s price page shows that Bitcoin (BTC) is still trading in the $112,000 to $113,000 range, nearly flat on the day. Ethereum (ETH) is down 0.3% at $4,182.

BTC Chart

Other top 10 altcoins by market capitalization are also showing mixed results. XRP is up 0.6% to $2.88, and BNB has gained 1.1%, trading at around $1,016. However, Solana (SOL) declined 3% to $212, losing over 9% on the week, the largest drop within that timeframe among the group.

The biggest gainer in the Top 100 over the last 24 hours is Flare (FLR), up 19% to a market capitalization of $2 billion, while the biggest loser turned out to be Mantle (MNT), which is down 7% over the same timeframe, per CoinGecko data.

Analysts at QCP Capital suggested in a Wednesday research note that with the first cut now priced in and Europe and Japan no longer clear outperformers, the “risk of a bottoming move is real.”

They added they still see the dollar “softer into year-end on divergence and further easing, but last week’s post-FOMC rebound is a reminder that the path is likely to stay choppy.”

Bitcoin Sentiment

Meanwhile, Santiment pointed out in a Tuesday note that there’s a high amount of “impatience and bearishness emerging from the retail crowd” on social media, describing it, however, as a “strong sign if you’ve been patiently awaiting a breakout as other small traders drop out.”

Liquidations, ETFs, and Macro

Leveraged positions came under pressure, with about $288 million in liquidations recorded over the past 24 hours, data from CoinGlass shows. ETH led with $68.5 million liquidated, followed by BTC with more than $52 million, SOL with over $31 million, and other altcoins totaling more than $28 million.

Upstart DEX Aster’s native token ASTER also ranked in the top five for liquidations, with over $16 million wiped out as its price briefly touched an all-time high at $2.40 before pulling back to $2.29, per CoinGecko.

Liquidation Heatmap

Outflows from exchange-traded funds (ETFs) extended into a second day, with SoSoValue data showing $103.6 million leaving spot Bitcoin ETFs on Sept. 23, while spot Ethereum ETFs recorded over $140 million in redemptions, almost double Monday’s $76 million.

As analysts at Glassnode noted in a Wednesday post, although overall accumulation remains intact, the slowdown in ETFs “suggests a pause in institutional demand.”

Macro conditions are also weighing on sentiment as Fed Chair Jerome Powell said Tuesday at an economics event in Warwick, Rhode Island, that policymakers face the dual challenge of “potentially higher inflation and a slowing labor market,” calling it a “challenging situation,” per CNN.

The Fed chief added that it’s a “reasonable base case” to see tariff inflation as a one-time thing, but added that “uncertainty around the path of inflation remains high” and officials need to “make sure that this one-time increase in prices does not become an ongoing inflation problem.”

Source: https://thedefiant.io/news/markets/crypto-market-stays-cautious-as-powell-warns-tariffs-could-fuel-inflation