Bitcoin, Ethereum Slide as Fed Rate Cut Bets and SEC Innovation Exemption Shape Crypto Market

I. Crypto Market Overview

Key Takeaways

Macro Environment

The Federal Reserve is expected to cut rates again in late October, supporting risk assets. The SEC will formalize a crypto 'innovation exemption' by late 2025, aiming to boost U.S. blockchain innovation. Gold has reached a record high above $4,000 amid U.S. government shutdown, reinforcing Bitcoin's 'digital gold' narrative.

Crypto Market

The crypto market is mixed over the past 12 hours, with BTC down 0.33% at $122,764 and ETH falling 3.7% to $4,490.96, pressured by ETF outflows and risk-off sentiment. Altcoins show divergence: Mantle (MNT) surged 10.4% on DeFi app news, Zcash (ZEC) rose 7.1% on privacy adoption, while SPX6900 gained 5% as a trending meme coin. Most other majors, including SOL and ARB, declined, reflecting sector rotation and cautious sentiment.

Today's Outlook

Key events today include the FOMC September meeting minutes release, which may signal the timing of the next Fed rate cut, and the RBNZ's surprise 50bp rate cut, both likely to drive volatility across risk assets and crypto markets.

Fear and Greed Index

82.00% Annual Percentile

62 Greed

Total Crypto Market Cap

$4.18T

1.90%

Total Market Trading Volume

$235.34B

13.50%

Altcoin Season Index

0.00%

Quarterly Percentile

54 / 100

Total Futures Market Open Interest

3.48B

1.95%

Futures

1.11T

4.71%

Perpetuals

II. Industry Updates

Macro-economic Policies

The Reserve Bank of New Zealand delivered a surprise 50bps rate cut to 2.50%, signaling further easing ahead. This dovish move pressured NZD and could boost BTC and DeFi liquidity as investors seek higher-yielding crypto assets.

Gold surged to a new all-time high above $4,000 per ounce, driven by safe-haven demand amid US government shutdown and expectations of further Fed rate cuts. This strengthens the narrative of Bitcoin as 'digital gold' and may increase crypto inflows.

The Federal Reserve is widely expected to cut rates again at its late-October meeting, following a September reduction. Lower US rates typically weaken the dollar and can drive capital into BTC and altcoins, supporting DeFi and NFT market activity.

India's inflation rose to 2.1% in August but remains within the central bank's target. Stable macro conditions in India support continued growth in crypto adoption and trading volumes, especially in stablecoin and remittance use cases.

The US labor market showed signs of weakness, with only 17,000 jobs estimated to be created in September. Slowing job growth increases the likelihood of further monetary easing, which could enhance risk appetite for crypto assets.

Cryptocurrency Regulatory Trends

The SEC confirmed plans to formalize an 'innovation exemption' for crypto firms by late 2025 or early 2026, aiming to provide regulatory clarity and encourage blockchain innovation in the U.S., which could boost investor confidence and attract new projects.

The Bank of England will allow stablecoin holding exemptions for crypto firms, softening its initial cap proposals after industry pushback. This move is expected to support UK crypto sector growth and align with U.S. regulatory trends.

Eurozone finance ministers will discuss measures to promote euro-denominated stablecoins, aiming to reduce U.S. dollar dominance in the stablecoin market and foster European digital asset innovation.

Dubai's Virtual Assets Regulatory Authority has intensified enforcement against unlicensed crypto firms, reinforcing its ambition to become a global crypto hub and potentially increasing compliance costs for market participants.

The European Systemic Risk Board has called for urgent policy action on cross-border stablecoins, warning of elevated systemic risks and signaling possible tighter EU regulations, which may impact stablecoin issuers and market structure.

Mantle (MNT): Mantle surged 11.9% in 24h to $2.54 with $563M volume, driven by the launch of the UR Neo Bank app, enabling fiat-to-crypto conversion and a debit card, expanding Mantle's DeFi ecosystem.

Zcash (ZEC): Zcash jumped 12.3% in 24h to $150.67 with $448M volume, following a 203% multi-week rally and the Zashi Swaps decentralized on-ramp launch, boosting privacy coin adoption.

SPX6900 (SPX): SPX6900 rose 5% in 24h to $1.53 with $69M volume, gaining traction as a top new meme coin for Q4 and maintaining strong community momentum after a 44% weekly rally.

Smart Money Movements

A new wallet acquired 20,020 ETH worth $89.7 million via FalconX, marking a major Ethereum market entry within the past 24 hours.

Upexi disclosed holdings of 2,018,419 SOL valued at $448.1 million, underscoring significant institutional confidence in Solana.

Bit Digital expanded its Ethereum holdings by 31,057 ETH to a total of 150,244 ETH, now valued at $675 million, funded by a $150 million convertible note.

Grayscale staked 304,000 ETH, exceeding $1.3 billion, through its Ethereum Trust ETFs, enabling investors to earn staking yields via traditional accounts.

BlackRock increased its crypto portfolio by $22.46 billion in Q3 2025, with Bitcoin holdings up $10.99 billion and Ethereum up $11.46 billion, reaching $15.83 billion in ETH.

Events to Watch

Oct 8 (Wed)

FOMC September meeting minutes to be released; markets await signals on next Fed rate cut. RBNZ announces 50bp rate cut, signaling further easing. Sweden releases September preliminary inflation data. National Bank of Poland concludes monetary policy meeting.

Oct 9 (Thu)

Fed Chair Jerome Powell to speak, providing further guidance on U.S. interest rate policy and economic outlook.

Oct 10 (Fri)

Premio Aretè Award winner to be announced, with Electroneum and One Ocean Foundation shortlisted for blockchain-based sustainability efforts.

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