Bitcoin ($BTCUSD) plunged to $112,000 overnight, marking its sharpest single-day drop since May 2022. The Bitcoin price crashes Fed decision focus dominates the crypto market as investors digest unexpected volatility and await clarity from central banks and geopolitical negotiations.
Bitcoin Drops 13% to $112,000 Amid Pre-Fed Volatility Surge
Bitcoin ($BTCUSD) has fallen by 13% in the past 24 hours, settling at $112,000 as of 06:00 UTC on October 29, according to CoinMarketCap data. Volume spiked above $76 billion, nearly double the recent daily average. The abrupt decline erased over $250 billion in total market capitalization from major cryptocurrencies. Ether ($ETH) also slid 9%, trading near $5,120. This steep sell-off comes just hours before the U.S. Federal Reserve’s anticipated rate decision, heightening anxiety across risk assets (source: CoinMarketCap, 2025-10-29).
Why Crypto Markets Are Bracing for Fed Policy and U.S.-China Talks
The Bitcoin sell-off arrives as global markets brace for the Federal Reserve’s pending interest rate announcement. Investors widely expect the Fed to keep the federal funds rate unchanged, but hawkish rhetoric or hints of future tightening have previously rattled digital asset prices. Meanwhile, revived U.S.-China trade negotiations are fueling further uncertainty. According to Bloomberg data, crypto volatility indexes have climbed 27% week-over-week, reflecting the sector’s hypersensitivity to macroeconomic signals and foreign policy moves. Historically, Bitcoin has tracked global liquidity shifts, often reacting swiftly to central bank actions and major geopolitical developments.
How Investors Can Position for Crypto Volatility and Policy Risk
Amid heightened volatility, investors are reassessing their crypto allocation strategies. Those holding Bitcoin ($BTCUSD) and Ether ($ETH) face risks from rapid price swings tied to the pending Fed rate decision and potential outcomes from emerging cryptocurrency market trends. Short-term traders are increasing the use of stop-loss orders, while institutional allocators are highlighting diversification into stablecoins or blockchain equities as a risk management tool. Traders are also monitoring stablecoin outflows, which surged 19% since October 25, as a signal of waning confidence in volatile cryptocurrencies. With central bank decisions and international negotiations due, both retail and institutional investors will need to balance tactical flexibility with long-term conviction in digital assets.
What Analysts Expect Next for Bitcoin and Broader Crypto Prices
Industry analysts observe that the combination of Fed policy decisions and geopolitical talks will likely keep volatility elevated in the near term. According to market strategists at Galaxy Digital and Amber Group (per October research briefings), further downside in Bitcoin is possible if the Fed signals prolonged higher rates or if U.S.-China negotiations stall. However, long-term sentiment remains constructive among major fund managers who view short-term price disruptions as a function of policy uncertainty rather than fundamental weakness.
Bitcoin Price Crashes Signal Key Levels to Watch After Fed Decision
Bitcoin price crashes Fed decision focus will remain centerstage as investors track the outcome of both Fed policy and U.S.-China talks. Key support levels near $108,000 and resistance at $120,000 are in play. Investors should expect continued choppiness and monitor macro developments for clear directional cues, with tactical discipline and robust risk controls essential in the days ahead.
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