Crypto Longs Wiped Out With $200M Liquidated Amid Powell’s Cautionary Fed Signal

Powell’s Hawkish Comments Trigger $200M in Crypto Liquidations as Altcoins Whipsaw

Crypto markets endured sharp volatility on Wednesday as hawkish comments from Federal Reserve Chair Jerome Powell led to a wave of liquidations and a swift drop in major digital assets.

Bitcoin (BTC) briefly dipped below $116,000 during Powell’s remarks before recovering to around $117,000. CoinGlass data showed more than $200 million in liquidations within the hour as leveraged traders were caught off guard. Ether (ETH) also dropped as much as 3% before bouncing back to $3,750, ending the day down 0.6%.

The Fed left its benchmark interest rate unchanged at 4.25%-4.5%, but Powell reiterated concerns that rising tariffs could rekindle inflation. “Tariff increases are pushing up prices,” he said, noting that short-term inflation expectations have edged higher. Two Fed officials—Michelle Bowman and Chris Waller—dissented, favoring a 25 basis point cut.

Altcoins saw even steeper intraday moves. Solana (SOL), Avalanche (AVAX), and Hyperliquid (HYPE) dropped 4%-5% before paring losses. Meme tokens BONK and PENGU plunged 10% before rebounding.

“The market is starting to sense that the Fed may be behind the curve,” said Matt Mena, analyst at 21Shares. “With softening inflation, weakening consumer spending, and rising unemployment, the risk of overtightening is increasing.”

Mena likened the current environment to late 2023, marked by easing inflation, heightened political uncertainty, and lagging economic data. He said this could set the stage for a policy pivot, potentially pushing Bitcoin to $150,000 by year-end.

In equities, Meta and Microsoft beat earnings expectations, sending their shares 10% and 6% higher respectively in after-hours trading.