The crypto market is crashing today, with Bitcoin price plunging to $108,000 and Ethereum moving below $4,000. Summary The crypto market is crashing today, erasing billions of dollars in value. This crash happened hours after the Federal Reserve slashed rates. Liquidations jumped by 130% to over $1.3 billion. The market capitalization of all cryptocurrencies fell by 4% in the last 24 hours to $3.64 trillion and the Fear and Greed Index moving to the fear zone of 34. Crypto market is crashing after the hawkish Fed The cryptocurrency market is going down after the Federal Reserve delivered a hawkish interest rate cut on Wednesday. Jerome Powell and other officials slashed rates by 0.25%, bringing the benchmark rate to between 3.75% and 4.0%. Additionally, they announced that they will end the quantitative tightening that has been going on in the past two years. Ending QT is often seen as a way to stimulate the economy. The main reason why the stock and crypto market crashed after the Fed cut is that officials did not signal a rate cut in December as analysts were expecting. Still, on the positive side, chances are that the Fed will deliver more cuts next year once Jerome Powell’s era ends. The ongoing crypto crash also explains why liquidations have jumped in the last 24 hours. They jumped by over 120% in the last 24 hours to $1.1 billion. Over 213k traders were liquidated in the last 24 hours, with Bitcoin (BTC) positions worth almost $500 million being wiped out. Ethereum (ETH) positions worth over $255 million were closed after they hit the margin call. Falling Crypto Fear and Greed Index and open interest The crypto market crash is also happening as a sense of fear spreads. Data shows that the Fear and Greed Index plunged to the fear zone of 34. Similarly, the CNN Money Fear and Greed Index remains at the ear zone of 42. It is common for the crypto and stock markets to drop when investors are fearful. This explains why the futures open interest in the derivatives market has dropped by over 1% to $161 billion. The fear in the crypto market intensified earlier this month after Donald Trump announced potential sweeping tariffs on goods from China. This announcement led to a strong crash and liquidations worth over $20 billion.
