XRP and Cardano’s ADA Slide as Bitcoin Traders Await FOMC Meeting with Unpredictable Outcome

Cryptocurrency markets are facing significant volatility as traders prepare for the Federal Reserve’s key FOMC meeting this week, with expectations leaning toward a pause in interest rate hikes. The market is anxious for any signals regarding future monetary policy shifts, which could have wide-reaching impacts across all asset classes, including digital assets.

Cardano (ADA) and XRP both experienced notable losses on Tuesday, with ADA declining by 4% and XRP dropping 2.8%. These downturns come amid broader market caution, with traders nervous about potential policy changes and the economic outlook. Bitcoin (BTC), however, showed relative stability, maintaining its position above the $94,000 mark, while Ethereum (ETH) saw a modest decrease of 1%.

The CoinDesk 20 index, a benchmark for the largest cryptocurrencies, fell by around 1.8%, reflecting the overall market hesitance. Meanwhile, Dogecoin (DOGE) dropped by 2%, underscoring the market’s cautious sentiment.

In contrast, decentralized finance (DeFi) tokens have been making significant strides this week. Hyperliquid’s HYPE led the charge, experiencing a 72% increase, while AAVE and Curve’s CRV also saw impressive gains of 35-40%. These gains point to renewed investor interest in DeFi projects with robust fundamentals, as the focus shifts away from riskier assets like memecoins.

“DeFi is starting to regain the spotlight as traders move away from more speculative plays like memecoins,” said Kay Lu, CEO of HashKey Eco Labs. “Tokens with solid use cases and strong fundamentals are seeing a resurgence, and HYPE is a prime example of this trend.”

Focus on the FOMC Meeting

The cryptocurrency market is eagerly awaiting the Federal Reserve’s meeting, where the decision to hold interest rates steady is widely anticipated. However, much of the market’s attention is focused on Chairman Jerome Powell’s speech, which may offer clues about the Fed’s stance on inflation and future monetary policy.

“While the rate decision itself may not cause significant market movement, Powell’s comments on inflation and trade risks will be crucial,” said Augustine Fan, Head of Insights at SignalPlus. “This could be a key moment for crypto markets, as they continue to react to broader economic signals.”

The uncertainty surrounding the U.S.-China trade relationship also continues to weigh on markets. Though trade talks remain stalled, the possibility of separate deals between the two nations has helped to stabilize risk sentiment somewhat.