Bitcoin Slips Near $63K Amid Chip Sell-Offs and Fed Uncertainty, Triggering Massive Liquidations

Bitcoin Slips Near $63K Amid Chip Sell-Offs and Fed Uncertainty, Triggering Massive Liquidations​

Bitcoin faced renewed pressure on Wednesday, consolidating around the $63,700 level after a sharp correction. The cryptocurrency was trading at $63,973, having briefly fallen to a 10-day low near $63,000. This short-term weakness was driven by a combination of falling investor sentiment, massive liquidations, and growing concerns surrounding the Federal Reserve's interest rate outlook.

Triggers Behind Crypto Correction​

The crypto market downturn was significantly influenced by broader macroeconomic cues spilling over into digital assets. A sharp sell-off observed in Asian semiconductor stocks contributed to the downward pressure on Wall Street and the crypto ecosystem. This decline led to over $510 million in liquidations across the market.

Continued outflows from US spot Bitcoin ETFs further weakened sentiment among participants. Akshat Siddhant, Lead quant analyst at Mudrex, pointed out that these factors, combined with uncertainty surrounding the Fed's monetary policy, are keeping traders cautious.

Market Performance and Altcoin Movement​

Globally, the crypto market capitalization registered a 0.62% increase, reaching $2.19 trillion according to CoinMarketCap. In the last 24 hours, Bitcoin saw modest gains of 0.88%, while Ethereum rose by 1.43%, trading at $1,910.

Among major altcoins, BNB, XRP, Solana, Tron, Dogecoin, and Cardano showed strength, with some gaining up to 5.14%. However, Hyperliquid registered a 1.40% decline in the short term. Overall, however, Bitcoin and Ethereum were down 2.98% and 0.46% respectively over the past week.

Institutional Interest vs. Risk-Off Sentiment​

Despite the recent volatility, market participants note that institutional interest remains intact in digital assets. This suggests that the broader crypto ecosystem is being driven by macroeconomic shifts rather than a structural failure of the market itself.

Avinash Shekhar, Co-Founder & CEO of Pi42, mentioned that the pause in spot Bitcoin ETF inflows following an extended period of sustained activity has prompted participants to reassess their near-term positioning. He added that Ethereum needs time to cool down before the Fed's policy decision, while XRP continues trading within a range awaiting stronger directional signals.

Market Perspective and Future Outlook​

Analysts suggest that the crypto market has entered a phase demanding heightened caution as investors await clearer guidance from the Federal Reserve. Nischal Shetty, founder of WazirX, indicated that the decline is attributable to rising liquidation activity, softer institutional flows, and a broader risk-off sentiment impacting global technology stocks.

Vikram Subburaj, CEO of Giottus, noted that Bitcoin traded near $63,620 on Wednesday, maintaining cautious positioning before the Fed’s policy decision following its retreat from last week’s local high near $66,700. Near-term price action is anticipated to be heavily influenced by the Fed's commentary and core PCE inflation data.

Riya Sehgal, Research Analyst at Delta Exchange, stated that markets are consolidating after the recent correction. She added that Bitcoin is attempting a recovery from key support while remaining under the $64,500-$65,500 resistance zone, with immediate resistance for Ethereum noted around $1,945-$1,970.