After former U.S. President Donald Trump supported cryptocurrencies and the FOMC’s upcoming interest rate decision, traders wondered what would happen to the cryptocurrency industry. Bitcoin (BTC), Ethereum (ETH), and XRP (XRP) derivatives activity is low, indicating purchasers are avoiding risk. On-chain data, however, shows a mixed picture, making buyers wonder if now the right time is to buy.
Lower Derivatives Market Activity Due to Liquidations
New information shows that XRP traders have cut back on their activity in the derivatives market. The number of trades in XRP dropped by almost 14%, while trades in BTC and ETH fell by 11% and 7%, respectively. All three of the biggest cryptocurrencies have lost nearly $89 million in value recently, which suggests that traders are being extra careful ahead of possible market turmoil.
Blockchain Data Shows Mixed BTC, ETH, XRP Signals
With its on-chain research, Santiment paints a complicated picture of the market. Even though Bitcoin’s Binance funding rate has been positive for three days in a row, which shows that people are optimistic, the amount of Bitcoin owned by funds has steadily declined.
Limited Profit-Taking Opportunities
Bitcoin buyers are better positioned to take profits despite the mixed outlook. This is because the number of daily on-chain transactions that are in profit is almost twice as high as the number of transactions that are in loss.
Trump’s Crypto Narrative: Bullish Catalyst?
Bitget CEO Gracy Chen has talked about how Trump’s growing interest in cryptocurrencies, stablecoins, and financial systems built on blockchain could change the market. More and more people are interested in the idea of a U.S. Bitcoin reserve, and as Trump’s team investigates stablecoins, institutional adoption may speed up. Trump could push for lower interest rates, which would benefit the crypto, tech, and AI sectors since the economy is unclear and there could be a “detox period.”
Conclusion
As the FOMC’s interest rate decision draws near, traders must weigh Trump’s support for crypto against the risk of short-term instability. Bitcoin has a great chance of making money, but Ethereum and XRP are more steady but not as likely to make money.
