Digital assets fell alongside a sharp rise in the odds of a Federal Reserve rate increase, though XRP bucked the trend with a gain of its own.
Bitcoin fell roughly 3% intraday, trading in a range around $77,000 to $77,400 after touching an overnight high above $79,500, as broader risk assets came under pressure from rising expectations of a Federal Reserve rate increase this week. Ether followed a similar pattern, trading near $2,480 after opening above $2,515. XRP was a notable exception, trading at $1.41, up roughly 2% even as the broader crypto market slid.
The proximate driver was a sharp move in interest-rate expectations. CME Group's FedWatch tool, which derives probabilities from fed funds futures pricing, showed a 92.5% probability of a 25 basis point rate increase at Wednesday's Federal Reserve decision, up from 86.5% on Monday and 69.4% at the end of last week. Rate increases tend to weigh on bitcoin and other digital assets in the same way they weigh on other longer-duration, higher-risk assets, since higher rates raise the opportunity cost of holding assets that do not generate yield and tend to pull capital toward interest-bearing alternatives.
The scale of the move in rate-hike odds over just a few trading days, climbing more than 20 percentage points from Friday to today, reflects how quickly the market has repriced its expectations for the Fed's decision, and digital assets have moved in step with that broader macro repricing rather than trading on crypto-specific news this week. XRP's divergence from the broader market's decline is worth watching in isolation, though a single day's outperformance against the backdrop of a sharp, macro-driven pullback across other major tokens is not itself evidence of a lasting shift in relative positioning.
With the Fed's actual decision due Wednesday, digital asset prices are likely to remain sensitive to any further shift in rate expectations between now and then, and to the market's read of the decision itself once it is announced.