Altcoins Drop Ahead of Federal Reserve Rate Decision and Key U.S. Data

Altcoin prices fell sharply Tuesday as cryptocurrency traders prepared for major U.S. economic events, including the Federal Reserve’s interest rate decision scheduled for Wednesday. The market sell-off was led by XRP, Solana (SOL), and Cardano (ADA), which each declined over 3% in the past 24 hours. Dogecoin (DOGE), Avalanche (AVAX), and Sui (SUI) also posted steeper losses, dropping more than 5%.

Over the past week, XRP and Solana have lost about 13%, while Dogecoin has plunged nearly 18%, reflecting increased market volatility and risk aversion. Bitcoin (BTC), in contrast, remained relatively stable, trading flat around $117,300.

Analysts attribute the decline in altcoins to a combination of leveraged trading positions and investor caution ahead of a packed economic calendar. The Federal Reserve’s two-day policy meeting began Tuesday, with expectations that Chair Jerome Powell will maintain current interest rates despite political pressure from President Donald Trump to implement cuts.

In addition to the Fed decision, traders are closely watching Friday’s release of U.S. nonfarm payroll data and approaching tariff deadlines that could further impact market sentiment. The heightened uncertainty has weighed on broader financial markets as well, with U.S. stocks erasing earlier gains and both the Nasdaq and S&P 500 slipping modestly into negative territory.

The crypto market’s recent volatility highlights investor sensitivity to macroeconomic signals, particularly in altcoins, which often experience sharper price swings compared to Bitcoin. Market participants will be monitoring upcoming data releases and central bank comments for clues on the next major move in digital asset prices.