Investing.com– Bitcoin traded near one-month lows on Monday, extending sharp losses from last week as investors remained cautious ahead of the Federal Reserve’s policy meeting and after heavy liquidations swept through leveraged crypto markets.
The world’s largest cryptocurrency last traded 0.2% lower at $80,185.6 by 03:05 ET (08:05 GMT).
Bitcoin declined more than 6% over the past week as a broader risk-off move across financial markets, driven by rising uncertainty over global monetary policy, sharp swings in foreign exchange markets, and volatility in U.S. Treasury yields.
Liquidations, Fed caution weigh on crypto markets
Last week’s selloff was exacerbated by forced liquidations in derivatives markets, where highly leveraged positions were unwound at speed.
More than $1 billion worth of leveraged crypto positions were liquidated during the recent turbulence, according to market data, with long Bitcoin bets accounting for the bulk of the losses. Such liquidations tend to amplify price declines as positions are automatically closed, adding to downward momentum.
Bitcoin had rallied strongly earlier this year, benefiting from expectations of easier U.S. monetary policy and sustained inflows into spot exchange-traded products. However, sentiment turned more cautious as investors reassessed the outlook for interest rates and reduced exposure to risk assets amid sharp moves in currencies and bond markets.
Attention is now firmly on the Federal Reserve’s two-day policy meeting, which concludes on Wednesday. Markets widely expect the Fed to keep interest rates unchanged, but traders will closely scrutinise Chair Jerome Powell’s remarks for clues on the timing and scale of potential rate cuts later this year.
Investors are also focused on signals around liquidity conditions and the Fed’s balance sheet, both of which are seen as key drivers of crypto market performance.
Adding another layer of uncertainty, traders are awaiting U.S. President Donald Trump’s expected announcement of his nominee for the next Federal Reserve chair.
The appointment is seen as potentially influential for future monetary policy direction, particularly if the new leadership is perceived as more dovish or more aligned with the administration’s economic priorities.
Crypto price today: altcoins remain weak
Most altcoins also fell on Monday, extending losses amid a cautious mood.
World no.2 crypto Ethereum fell 1.5% to $2,897.92.
World no. 3 crypto XRP eased 0.8% to $1.88.
Solana fell 3%, while Cardano and Polygon declined 1.5% each.
Among meme tokens, Dogecoin edged down 0.8% and $TRUMP fell 1%.
