Crypto Market Loses $100 Billion in Market Cap as S&P Hits New Highs

Bitcoin fell more than 4% to nearly $111,000 on Wednesday as U.S. stocks hit new highs ahead of the Federal Reserve’s decision, a divergence due more to crypto positioning and flows than broad macro risk aversion.

Nvidia surpassed $5 trillion in market value, concentrating stock gains in a handful of AI leaders even as crypto de-risked event risk, according to Reuters.

Positioning is re-entered into the meeting window, making prices more sensitive to liquidations. Open interest in perpetuals and futures rebounded toward around $30 billion this week, and a modest wave of long liquidations overnight was enough to send the price lower amid low liquidity. Ethereum traded near $4,000, also down more than 4% from 24-hour highs.

Spot ETF flows, which set a record in early October, have slowed daily, removing key marginal supply while investors wait for clarity on policy. Weekly inflows remained positive at $1.03 billion in the latest update, following a record $5.95 billion in the week ending October 4. With exchange balances near multi-year lows, the float is tighter, so changes in flows are still transmitted quickly as activity picks up again.

The market is also digesting the tariff shock of early October, resetting its leverage after lengthy selloffs as U.S. and Chinese headlines put pressure on risky assets.

Depth has not returned to September levels, so smaller imbalances can move prices further than before the shock, and sensitivity increases as open interest increases.

Stocks have not generated a broad risk boost.

The strength of tech mega-caps, led by Nvidia’s $5 trillion milestone, took the S&P 500 to new levels, while market scale remained a concern for major offices. This setup allows stocks to rise even as the crypto trades its own microstructure.

In the policy decision, the base case is a 25 basis point cut with limited pullback, then a new crypto beta after the event if funding normalizes and ETF net inflows accelerate again.

A hawkish version would associate a decline with cautious guidance, a firmer dollar and unstable crypto while open interest remains high and rallies fade.

A case of risk involves a macro headline or surprisingly firm tone that restarts long selloffs and pushes BTC towards recent support at $108,000 to $110,000, where leverage is rebuilt.

For near-term confirmation, watch if BTC holds above $110,000 until the US close, if open interest stabilizes or declines after the event, if US spot ETFs show positive net flow over the next two to three sessions and if the 25 delta put more defensive asymmetric turns.

The FOMC decision and press conference are scheduled for today.