Cryptocurrencies Under Pressure: Weekly Rally Crumbling Ahead of Fed Decision

Cryptocurrencies experienced a broad upward movement last week, with double-digit gains in several top coins — but the euphoria was short-lived. While institutional inflows suggest solid demand, traders show hesitation at breaking new resistance levels. The upcoming Federal Reserve meeting will be a turning point for risk assets.

Bitcoin’s Volatile Movement: Derivatives Trading Instead of Genuine Demand

Bitcoin briefly touched the $75,000 mark on Tuesday morning, reaching $75,912 before quickly falling back to $74,372. This price movement reveals a fundamental problem: the rally was not driven by fresh spot market demand but rather by activity in the derivatives market. Specifically, large put positions at $60,000 accelerated the move — when these contracts were closed, the resulting balancing forces forced market makers to buy Bitcoin on the spot market.

The rapid retreat below the $74,400 support level, a key support from April 2025, shows that traders are unwilling to establish new highs without a fundamental trigger. Current prices around $70,840 reflect this uncertainty — a 4.1% decline over seven days.

Cryptocurrencies with Broad Weekly Rally — But the Facade Is Crumbling

Despite the current weakness, the biggest cryptocurrencies recently posted significant weekly gains. This upward trend marked the broadest rally since the start of the Iran war and included:

• Ether: Temporarily +13.3% to $2,316, currently at $2,160 (-7.14% over 7 days)
• XRP: Currently at $1.44 (-5.94%, temporarily +11%)
• Dogecoin: Trading at $0.10 (-6.56%, temporarily over $0.105)
• BNB: At $638.30 (-5.76%, previously at $676)

This development highlights the core issue of the current market phase: cryptocurrencies swing between hope and caution. The initial upward movement was real, but without corresponding demand impulses, such gains can erode just as quickly.

Institutional Flows Stabilize Sentiment

A brighter point lies in institutional activity data. Spot Bitcoin ETFs saw net inflows of about $767 million last week — the third consecutive week of positive capital flows. This marks a clear reversal from the five-week outflow period at the start of the year, when over $3 billion left the market.

These institutional flow data are an important confidence signal for cryptocurrencies. Mark Pilipczuk of CF Benchmarks emphasizes that these sustained inflows support a substantial recovery — not only as a price floor but as a sign that established financial players are taking the “digital gold” narrative more seriously.

Convergence with Gold: An Underestimated Signal

A fascinating development emerges when comparing with gold ETFs. While GLD (spot gold ETF) achieved about 16% returns year-to-date until mid-March, Bitcoin ETF IBIT lost about 19% — but this gap has narrowed dramatically.

Since early March, Bitcoin has outperformed gold by 13.2%. Even more impressive: the 90-day correlation between the two assets shifted from -0.27 to +0.29 within six months. In other words — cryptocurrencies and gold are increasingly moving in sync, revitalizing the “digital gold” narrative.

Fed Decision as a Fateful Moment for Risk Assets

The true fate of cryptocurrencies and other risk assets will be decided this week. The Federal Reserve meeting, which begins this week and ends on Wednesday, is the critical catalyst.

CME FedWatch indicates over a 95% probability of holding the interest rate range steady at 3.5% to 3.75%. The decision itself is unlikely to surprise. What matters are two elements: the dot plot, which signals future rate expectations, and Powell’s press conference.

The context is complex. Oil prices above $100 make a stagflation debate unavoidable, while the labor market is weakening — the loss of 92,000 jobs in February remains a grim signal. The Fed is caught between two opposing forces. How Powell frames this tension on Wednesday will significantly influence risk appetite until the end of the month — and thus the dynamics of cryptocurrencies.

Venture Capital Discovers Prediction Markets as a New Hotspot

Alongside mainstream fluctuations in cryptocurrencies, the ecosystem is expanding with a new layer. Venture capital firm 5c© Capital was founded to target investments in companies built around prediction markets. Support comes from CEOs of Polymarket and Kalshi — two leading platforms in this segment.

The fund plans to raise up to $35 million and aims to support about 20 early-stage startups within two years. The focus is not only on exchange platforms but on comprehensive infrastructure: data tools, liquidity provision, and compliance systems.

The timing is strategic. Prediction markets are experiencing rapid growth — rising trading volumes, new users, and increasing interest from both large crypto and retail trading platforms drive development. The fund has already attracted more than 20 early investors, including a portfolio manager from Millennium Management and founders of established prediction markets.

This development signals that the crypto industry is not only measured by price movements — infrastructure development is running in parallel and will contribute to market maturity in the medium to long term.