Key Takeaways:Bitcoin (BTC) dropped below the $100,000 mark for the first time since June, extending its monthly loss to over 18%.The decline follows hawkish Federal Reserve signals suggesting fewer rate cuts and a slower end to balance sheet runoff, pressuring liquidity across risk assets.Total crypto market capitalization slipped 1.9% to $3.35 trillion, while open interest fell sharply, showing leveraged positions are being unwound.Analysts now eye the $97,500–$99,000 zone as key support; a recovery above $102,000 would be needed to restore bullish momentum.Bitcoin Breaks Below $100K Amid Fed-Driven Sell-OffBitcoin extended its decline on Friday, breaking below the $100,000 threshold amid renewed macro pressure and fading liquidity conditions. The move marks Bitcoin’s weakest level since June, with the broader crypto market following suit.As of publication, BTC trades around $99,420, according to CoinGecko data, after briefly dipping to intraday lows near $98,700. Ether (ETH) also dropped to around $3,210, losing nearly 4% in 24 hours.The slump coincides with comments from Federal Reserve officials during the latest FOMC meeting, who signaled that rate cuts could be delayed until inflation returns closer to 2%. Fed Chair Jerome Powell emphasized that while balance sheet tightening (quantitative tightening, or QT) could slow, the Fed will not expand liquidity prematurely, effectively draining risk appetite from crypto and equities alike.FOMC Signals Shake Liquidity and ConfidenceThe Fed’s shift toward a “higher for longer” stance has reignited investor caution. Treasury yields rebounded, the dollar strengthened, and global equity indices declined over 1% as traders priced in a slower easing cycle.For crypto, this translates to tighter capital conditions. Funding rates on Bitcoin futures fell below 5% annualized, and open interest dropped to $24.6 billion, down from $26 billion a week ago. Derivatives data from CoinGlass show $680 million in liquidations over the past 24 hours, with 67% of those losses coming from long positions.“The Fed’s hesitation to pivot back to expansionary policy is a liquidity shock for risk markets,” said one analyst. “Crypto, being highly liquidity-sensitive, is absorbing that impact first.”Altcoins Extend Losses, Except AI TokensAltcoins are broadly underperforming Bitcoin. XRP dropped 4.1%, SOL fell 3.8%, and BNB slipped 2.9%. The Altcoin Season Index sits at 21/100, its weakest in more than three months, indicating that capital rotation into smaller assets has stalled.The exception comes from AI-linked tokens, with FET and NEAR up 17% and 15% respectively, as traders seek speculative momentum in high-volume narratives. Still, analysts caution that these gains remain isolated and could fade quickly if Bitcoin’s weakness persists.What’s Next for Bitcoin?Bitcoin’s immediate outlook hinges on whether it can hold the $97,500–$99,000 support zone. A sustained recovery above $102,000 would be needed to confirm renewed buyer strength.Should the Fed hint at renewed liquidity measures in upcoming speeches or minutes, Bitcoin could stage a relief rally — but until then, macro tightening and low risk tolerance are likely to dominate sentiment.
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