Fed Cuts Rates, But Powell’s Warning Sends The Crypto Market Lower

Core Insights - Fed Chair Jerome Powell's statement regarding the uncertainty of a December interest rate cut has impacted financial markets, leading to a surge in the US Dollar Index (DXY) to its highest level since August 2025 [1] - The recent interest rate cut of 25 basis points and the end of quantitative tightening (QT) on December 1 are seen as bullish signs for crypto markets, yet investor sentiment has worsened [2][3] - The Coinbase Premium Gap turning negative indicates weakening institutional demand, suggesting a cautious stance among large players despite positive macro headlines [4] Market Reactions - The DXY climbed to 99.7 points, marking a potential shift from bearish to bullish territory, which has put pressure on crypto markets [5] - Bitcoin (BTC) has fallen below $110,000, and Ethereum (ETH) has lost the $4,000 mark, reflecting a decline in the crypto market by 2% over the past 24 hours [3] - Powell's remarks have dampened expectations for immediate further easing, contributing to the current market environment [6]