Virtual Assets, $40 Billion Evaporate... Crypto Market 'Screams' at Powell's Final Warning

▲ Bitcoin (BTC), Ethereum (ETH), Dogecoin (DOGE), Cryptocurrency Decline/AI Generated Image

Ahead of the final regular Federal Open Market Committee (FOMC) meeting chaired by Federal Reserve (Fed) Chairman Jerome Powell, a large amount of capital flowed out of the virtual asset market. As investors reduced their exposure to risky assets to avoid uncertainty, intensifying the so-called 'risk-off' phenomenon, tens of trillions of won in market capitalization evaporated in a single day.

According to a report by virtual asset specialized media BeInCrypto on April 28 (local time), Bitcoin (BTC) price fell below $76,000, and the total virtual asset market capitalization recorded $2.62 trillion, a decrease of approximately 1.8% over the past 24 hours. This translates to approximately $40 billion in value disappearing in a single day. This downward trend repeats a typical pattern where Bitcoin and major altcoins show weakness 24 hours before the Federal Open Market Committee decision.

Ethereum (ETH) fell by approximately 2%, and XRP plummeted by 2.2%, leading the market decline. BNB also could not escape weakness, falling by 0.7%. Notably, the inflow of Bitcoin to exchanges surged, increasing selling pressure. According to on-chain data, approximately 10,000 BTC were deposited to exchanges in just one day, with over 70% of this volume identified as belonging to large investors, or 'whales'. This suggests that it's not merely the movement of individual investors, but rather large players intentionally closing their positions.

The market's attention is focused on Chairman Powell's final interest rate decision and press conference, to be announced on the 29th local time. According to CME FedWatch, the probability of the Federal Reserve freezing interest rates at the current 3.50% to 3.75% is 100%. Investors are focusing less on the interest rate figures themselves and more on the tone of future monetary policy that Powell will present, and the policy guidelines he will hand over to Kevin Warsh, the nominee for the next chairman. Powell is regarded as the figure who led the most aggressive tightening cycle since Paul Volcker, raising interest rates from 0% to 5.5%.

Currently, US inflation is stagnant at around 3.3%, and Bitcoin has undergone a significant correction from its peak of $126,000 recorded at the end of last year. In early March, $1.47 billion flowed into Bitcoin spot ETFs, attempting a rebound, but after the previous Federal Open Market Committee meeting, capital outflow began again, solidifying the downward trend. Experts predict that if there is no hint of interest rate cuts in Powell's farewell speech, a further decline in the virtual asset market will be inevitable.

The virtual asset industry is also paying attention to the actions of nominee Warsh, who will emerge after Chairman Powell's retirement. While Warsh is known to have a favorable stance on virtual assets, the dominant analysis suggests he will show a more hawkish tendency than Powell in curbing inflation. The ability of Bitcoin to defend the $70,000 mark will depend on how well Powell manages market expectations in his final meeting.

*Disclaimer: This article is for investment reference only, and we are not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*