Fed's "hawkish rate cut" and profit-taking in the crypto market

Author: Hotcoin Research

Cryptocurrency market performance

Currently, the total market capitalization of cryptocurrencies is $3.71 trillion, with BTC accounting for 59.3%, which is $2.2 trillion. The market capitalization of stablecoins is $307.1 billion, which has decreased by 0.59% in the last 7 days. It is worth noting that the number of stablecoins has shown negative growth this week, with USDT accounting for 59.69%.

Among the top 200 projects on CoinMarketCap, most have declined while a small number have risen, including: ZEC with a 7-day increase of 58.98%, VIRTUAL with a 7-day increase of 57.8%, DASH with a 7-day increase of 47.23%, ZEN with a 7-day increase of 79.8%, and HNT with a 7-day increase of 29.57%.

This week, the net outflow of Bitcoin spot ETFs in the U.S. was $800 million; the net inflow of Ethereum spot ETFs in the U.S. was $16.4 million.

Market Forecast (November 3 - November 7):

The current RSI is 46.56 (neutral range), the Fear and Greed Index is 32 (lower than last week, in the fear range), and the Altcoin Season Index is 43 (lower than last week).

BTC Core Range: $107,000-112,000

ETH core range: $3,600-4,100

SOL core range: $175-205

This week, the Federal Reserve lowered interest rates by 25 basis points as expected, but Powell maintained a “hawkish” stance on whether to lower rates in December, which has had a certain impact on the market. Some long-term holders are taking profits, leading to a “buy the expectation, sell the news” situation in the market. In the future, attention should be paid to new comments that affect the interest rate decision, as well as the inflow and outflow status of spot ETFs, as these are the core variables of the market. In summary, the market is at a critical technical juncture, and next week will be a phase of volatility and direction selection.

For long-term investors, the core idea is to ignore short-term noise and focus on long-term value and trends.

For short-term traders, next week will be a crucial period for technical battles, requiring more flexible and sharp responses. When the direction is unclear, it is essential to maintain low leverage or even zero leverage to avoid being forced to liquidate due to extreme volatility.

Understand now

Review of the week's major events

1. On October 27, local time, on October 26, the China-U.S. economic and trade teams concluded a two-day negotiation in Kuala Lumpur, the capital of Malaysia. According to Reuters, this is the fifth face-to-face negotiation between the China-U.S. economic and trade teams since May of this year. After the talks, U.S. Treasury Secretary Basant stated in an interview with U.S. media that after the two-day talks in Kuala Lumpur, both sides reached a “very substantive framework agreement,” and the U.S. side is “no longer considering” imposing a 100% tariff on China;

2. On October 27, Monday, the spot gold opened significantly lower with a gap of 40 dollars and then rebounded, currently reported at 4102 dollars/ounce;

3. On October 26, Mattel's joint statement indicated that the U.S. will maintain a 19% tariff on Thailand. Thailand will eliminate tariff barriers on approximately 99% of goods, covering all U.S. industrial products as well as food and agricultural products.

On October 28, GMGN officially posted on social media stating, “In response to recent false rumors regarding GMGN being hacked, resulting in user fund losses, a comprehensive security audit has been immediately launched. It is now confirmed that the platform has no security issues and user funds are safe.”

5. On October 28, according to official news, Coinbase's wholly-owned investment management institution, Coinbase Asset Management (CBAM), announced today a strategic partnership with asset management giant Apollo (NYSE: APO) to jointly launch a stablecoin-based credit strategy plan. This move aims to build a bridge connecting the three major fields of stablecoins, private credit, and asset tokenization, with the goal of exploring quality credit opportunities in the rapidly expanding stablecoin ecosystem.

6. On October 29, according to TheBlock, Visa will accept payments in four stablecoins on four independent blockchains, which can be converted into two target fiat currencies and can be converted back into more than 25 traditional fiat currencies;

7. On October 30, according to Reuters citing informed sources, OpenAI is preparing for an IPO, with a valuation potentially reaching $1 trillion. Informed sources revealed that the company is considering submitting documents to regulators as early as the second half of 2026, with a minimum fundraising amount of $60 billion, and the specific valuation and timing will depend on business growth and market conditions. OpenAI CFO Sarah Friar has indicated to some individuals that the company's goal is to go public in 2027;

On October 30th, according to Axios, sources revealed that MetaMask's parent company Consensys has hired JPMorgan and Goldman Sachs to lead its initial public offering (IPO). It is reported that this IPO could take place as early as 2026, but details regarding the scale and valuation have not been disclosed.

9. On October 31st, researchers from the Ethereum Foundation have officially set a date for their mainnet hard fork (codenamed “Fusaka”). During Thursday's “All Core Developers” conference call, researchers from the Ethereum Foundation stated that Fusaka will go live on December 3rd;

10. On October 31, according to CNBC, Coinbase's Q3 financial report exceeded expectations, with Q3 net profit rising from $75.5 million (28 cents per share) in the same period last year to $432.6 million ($1.50 per share). Earnings per share surpassed the consensus expectation of $1.10 from analysts aggregated by the London Stock Exchange Group.

On October 31, according to Bloomberg, Strategy announced its Q3 earnings report after U.S. stock market hours, achieving a net profit of $2.8 billion for the quarter, driven by unrealized gains from its approximately $69 billion cryptocurrency holdings.

macroeconomics

1. On October 29, the Bank of Canada lowered the benchmark interest rate by 25 basis points to 2.25%, in line with market expectations, marking the second consecutive rate cut;

2. On October 30, the Federal Reserve FOMC statement announced that it will end the balance sheet reduction on December 1. (Currently reducing by $5 billion in U.S. Treasuries and $35 billion in MBS per month;

On October 30, the Federal Reserve lowered the benchmark interest rate by 25 basis points to 3.75%-4.00%, marking the second consecutive meeting of rate cuts, in line with market expectations.

4. On October 31, according to the Federal Reserve's rate monitor, the probability of a 25 basis points rate cut in December is 60.8%.

ETF

According to statistics, from October 27 to October 31, the net outflow of Bitcoin spot ETFs in the United States was $800 million; as of October 31, a total outflow of $24.638 billion from GBTC (Grayscale) was recorded, currently holding $18.833 billion, and IBIT (BlackRock) currently holds $88.421 billion. The total market value of Bitcoin spot ETFs in the United States is $149 billion.

Net inflow of Ethereum spot ETF in the US: 16.4 million dollars.

Envision the future

Event Announcement

1. Bitcoin MENA will take place from December 8 to 9 at the Abu Dhabi National Exhibition Centre (ADNEC);

2. Solana Breakpoint 2025 will be held in Abu Dhabi from December 11 to 13.

Project Progress

1. The first project launched on the YGG Play Launchpad platform is the in-game loyalty and reward token LOL for the game LOL Land, which will officially launch on November 1 and begin trading on DEX.

2. The deadline for receiving the Monad airdrop is November 3.

Important events

1. Nasdaq applies to the U.S. SEC to add XRP, SOL, ADA, and XLM to the cryptocurrency index, with a final decision expected before November 2.

2. The trial date related to the Bitcoin privacy wallet Samourai Wallet has been set for November 3, 2025.

Token Unlock

1. Sui (SUI) will unlock 43.96 million tokens on November 1, worth approximately $103 million, accounting for 1.21% of the circulating supply;

2. EigenCloud (EIGEN) will unlock 36.82 million tokens on November 1, worth approximately 33.99 million USD, accounting for 12.10% of the circulating supply;

3. Omni Network (OMNI) will unlock 7.99 million tokens on November 2, valued at approximately $17.34 million, accounting for 30.30% of the circulating supply;

4. Memecoin (MEME) will unlock 3.45 billion tokens on November 3, worth approximately $5.23 million, accounting for 5.98% of the circulating supply.

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