Crypto Markets Rally on Growing Fed Easing Bets, With BTC and ETH Leading Ahead of Turbulent Trading

Crypto markets were steady on Tuesday as traders turned their attention to Wednesday’s Federal Reserve meeting, where a 25-basis-point rate cut is widely seen as a foregone conclusion. With the shift already embedded in market pricing, sentiment across digital assets remains constructive, reflecting the expectation that easier monetary policy should continue to buoy risk assets such as bitcoin.

Bitcoin hovered near $92,300 after gaining 2.3% over the past 24 hours, while ether extended its recent momentum with a 7% jump. Still, volatility risk looms. Fed days often produce sharp, short-lived bursts of price action, and even a supportive 25 bps cut could prompt traders to lock in profits, triggering a “sell-the-news” dip that pressures late long positions.

Bitcoin has spent the past week oscillating between $88,000 and $94,500, forming a well-defined range. A breakout above or below these levels is likely to determine the next directional move.

Derivatives positioning

• Volmex’s one-day implied volatility measure for BTC surged to 67% from 20%, suggesting an expected 24-hour move of roughly 3.5%. While elevated, it signals that traders do not expect the Fed event to deliver an extreme shock.
• Ether is priced for a 4.6% move, with solana and XRP each projected to swing around 5%.
• BTC’s options curve shows a slight front-end inversion, with near-term premiums higher than longer-dated volatility. If the Fed outcome underwhelms, that structure could flatten quickly.
• On Deribit, puts on BTC and ETH remain more expensive than calls. Recent block flows highlighted ETH straddles and strangles—classic volatility plays—while BTC traders showed interest in risk reversals.
• Futures open interest is climbing across major tokens. ETH OI rose 8% to 12.4 million ETH, its highest level since early December. Cardano’s OI briefly reached 1.80 billion ADA, the highest since Oct. 10.
• Funding rates for BCH, XMR and WLFI remain deeply negative, pointing to heavily short-biased positioning.
• On CME, ether futures OI climbed back above 2 million ETH, while bitcoin futures activity remains subdued near multi-month lows.

Token talk

Beyond ether’s strength—helped by attention following last week’s Fusaka upgrade—the altcoin market remains under pressure. CoinMarketCap’s altcoin-season metric is down to 16/100, marking a cycle low and a sharp reversal from September’s near-80 reading as traders concentrate liquidity in larger-cap names ahead of the Fed.

HYPE has been one of the poorest performers this week, shedding 15%. STRK, KAS and APT also endured double-digit declines. Meanwhile, FET, one of the prominent AI-focused tokens, rose 9.3% over the past 24 hours as it attempted a short-term recovery. Still, it remains down 1.6% on the week and more than 80% lower year-to-date, highlighting persistent weakness despite pockets of speculative interest.