Crypto Market Edges Up as Investors Weigh Fed Moves and Government Shutdown Risks

The crypto market ticked higher on Monday, recovering from last week’s pullback after upbeat U.S. growth and jobs data dimmed expectations for further Federal Reserve rate cuts.

Bitcoin (BTC) is currently changing hands near $113,853, up about 3.9% on the day. Ethereum (ETH) followed suit, rising more than 4% to trade near $4,175, according to data from The Defiant’s price page.

“We have seen institutional and retail support at $110,000 from those that missed $BTC at the $100,000 level, so the small bounce here is not surprising; however, the macro environment remains a little uncertain over the last week,” said Paul Howard from Wincent. “Rate increases are baked into price, and there is still downside risk until we see a bigger macro move in the coming month.”

The top-10 altcoins outpaced the majors with Solana up nearly 5% to $210 and XRP up 4.5% to $2.90. BNB and Cardano (ADA) both spiked 4.4% to $1,020 and $0.80, respectively.

Dogecoin, the largest memecoin, rose 3% to $0.23, while TRON slipped 0.5% to $0.30. Among tokens outside the top 10, pumpfun’s PUMP jumped 11% to $0.005, and Mantle’s MNT advanced 9% to $1.89.

The day’s biggest losers were Plasma’s XPL, down nearly 11% to $1.30 just a week after its launch, and Provenance Blockchain’s HASH, which slid 8.5% to $0.03.

Overall, the total crypto market capitalization increased by 3.2% over the past day, reaching $4 trillion, with Bitcoin dominance at 56.6% and Ethereum at 12.6%.

Liquidations, ETFs, and Investment Products

In the past 24 hours, nearly $434 million in crypto positions were liquidated, per Coinglass data, with longs accounting for over $104 million and shorts making up around $330 million.

Ethereum led the way with nearly $151 million in liquidations, followed by BTC at nearly $95 million, while SOL accounted for around $42 million.

Spot Bitcoin ETFs recorded $418 million in outflows on Sept. 26, marking a second straight day of withdrawals. Spot Ethereum ETFs posted over $248 million in outflows, extending their streak to five days with a cumulative $796 million withdrawn, according to SoSoValue.

Digital asset investment products experienced $812 million in outflows last week, though year-to-date inflows remain strong at $39.6 billion, near last year’s record, according to CoinShares’ Fund Flows report.

Bitcoin lost $719 million and Ethereum dropped $409 million, facing the heaviest outflows, while Solana attracted $291 million in inflows ahead of anticipated U.S. ETF launches.

Macro Uncertainty

Monday’s rebound comes as investors digest mixed economic news. Strong U.S. growth and jobs data last week lowered expectations for further Federal Reserve rate cuts, while worries about a possible government shutdown this week are keeping markets cautious.

As a result, some traders are buying at lower prices, while others are staying on the sidelines, analysts said.

“The Fed’s dovish tilt is medium-term positive, but [Fed Chair Jerome] Powell’s bubble warning and shutdown risk mean traders should stay cautious in the short term,” experts from Bitunix said in comments shared with The Defiant. “Market sentiment will swing between ‘rate-cut optimism’ and ‘political/valuation risks.’”