Bitcoin Slides Below $88,000 as Traders Brace for Fed Rate Decision
Crypto markets largely flat on Tuesday morning, with Bitcoin hovering near $87,640 amid heightened caution ahead of the U.S. Federal Reserve’s policy meeting.
Market snapshot
- Bitcoin (BTC) traded around $87,640, little changed in the last 24 hours but down ≈3.5 % on the week.
- Ethereum (ETH) slipped to about $2,920, a 0.5 % decline for the day and just over 5 % lower on the weekly chart, still struggling to reclaim the $3,000 threshold.
- Among the top‑10 crypto assets by market cap, most were stable or modestly weaker. XRP led the losers, sliding roughly 2.6 %.
The broader sentiment remains uneasy. The Crypto Fear & Greed Index is still entrenched in the “fear” zone, reflecting traders’ wait for clearer macro‑economic signals.
Institutional demand still muted
On‑chain analytics from Glassnode show the 30‑day simple moving average of net flows into spot Bitcoin and Ethereum ETFs remaining negative, suggesting that institutional appetite has yet to revive.
“Spot trading volume is steady but subdued, pointing to a consolidation phase rather than a decisive move,” the firm noted in a recent X post.
In line with the on‑chain data, net inflows into spot ETFs have been modest. On 26 January:
- Ethereum spot ETFs attracted nearly $117 million in new capital, taking total assets to $17.62 billion.
- Bitcoin spot ETFs logged a smaller $6.84 million inflow, with total assets now at $113.5 billion.
These figures underline a “soft” demand environment for risk‑on crypto assets.
Movers and liquidations
Gainers
- HYPE (Hyperliquid) surged 22.6 %, buoyed by TradeXYZ’s recent milestone of $1 billion in 24‑hour trading volume and a record $790 million in open interest.
- PUMP (PumpFun), a memecoin launchpad token, climbed over 17 %.
Losers
- RIVER reversed its prior gains, plunging ≈29 % and becoming the day’s biggest dragger.
- Polygon (POL) posted a milder decline of about 5 %.
Liquidations remained contained. Data from CoinGlass indicate that under $200 million in leveraged positions were liquidated in the past day, split fairly evenly between long and short side bets. By asset, the silver perpetual contract (XYZ:SILVER) led the liquidation tally, erasing roughly $42.6 million as spot silver prices slipped from a fresh high reached the day before. This follows a recent trend of crypto traders turning to tokenized precious metals as those markets hit new peaks.
Macro backdrop
All eyes are on the Federal Reserve’s upcoming policy meeting scheduled for Wednesday afternoon. The consensus among market participants, as reported by CNBC, is that the Fed will likely hold the benchmark rate steady within its current 3.5 %–3.75 % target range. A decision to maintain rates would reinforce the status quo, but any surprise—either a rate cut or a hike—could reignite volatility across both traditional and crypto markets.
Key takeaways
- Bitcoin remains just under $88k, with weekly momentum still negative; the pair’s price action is now largely dictated by macro‑economic developments.
- Ethereum continues to test the $3,000 level, hinting at lingering weakness despite modest daily recovery.
- Institutional inflows into spot crypto ETFs are tepid, reflecting cautious investor sentiment while the Fed’s decision looms.
- Crypto‑linked precious‑metal contracts are attracting new interest, as evidenced by sizable liquidations in silver tokenized futures.
- Top‑ranked altcoins show divergent moves: Hyperliquid’s HYPE and PumpFun’s PUMP rally, while RIVER suffers a sharp pull‑back.
- The upcoming Fed rate decision is the primary catalyst for short‑term price direction; a hold is expected, but any deviation could spark renewed market swings.
Stakeholders should monitor both the Fed’s statements and the flow dynamics in spot ETFs for early signals of any shift in risk appetite.
Source: https://thedefiant.io/news/markets/bitcoin-slips-under-usd88k-market-update-jan-27-2026
