XRP Faces Critical Week with Fed Decision: Will Powell’s Move Spark Crypto’s Next Rally?

The Federal Reserve's next move could send shockwaves through the crypto market—and XRP is sitting right in the crosshairs.

Why This Week Matters

It's not just another meeting. Traders are watching for any hint of a policy shift—a dovish whisper, a hawkish pause—that could redefine risk appetite overnight. Crypto doesn't trade in a vacuum. When traditional finance catches a cold, digital assets often sneeze first.

The Liquidity Lens

Cheap money built this bull run. Tighter conditions could starve it. XRP, with its heavy institutional footprint and regulatory clarity, often acts as a liquidity barometer. A favorable Fed could unlock sidelined capital; a harsh one might trigger a flight to safety. It's a high-stakes game of chicken between monetary policy and market momentum.

The Cynical Take

Let's be real—central bankers deciding the fate of a decentralized asset is the kind of irony that would make a satirist blush. Since when did the future of finance hinge on a committee's press release?

Bottom Line: Watch the Fed, but trust the chart. If XRP holds key levels through the volatility, it's signaling strength no matter what the old guard decides.

Austin Hilton, a prominent crypto commentator, highlighted a crucial macroeconomic development that has once again redirected the focus of XRP investors towards the US Federal Reserve (Fed) this week. As the anticipation of the interest rate decision to be announced on Wednesday reaches its peak, experts agree that XRP could be directly impacted by this decision.

Why the Fed’s Rate Decision Matters for XRP

Hilton acknowledges that investors might be weary of macroeconomic comments but emphasizes that this week will be decisive for the crypto market. According to CME FedWatch data, the probability of a rate cut has risen from 87% to 89.6%. The expectation leans towards the Fed implementing a 25 basis point cut.

Hilton notes that the market has largely priced in this expectation, warning that if the Fed surprises by not cutting rates, a sharp market pullback could occur. Conversely, if a rate cut proceeds as expected, the initial response might be limited, but Fed Chairman Jerome Powell’s statements could shape market direction.

Preceding the decision, XRP has experienced a decline between 1.3% and 1.6%. However, according to Hilton, an announced rate cut could support the financial conditions necessary for a potential bull market continuation.

Bank of Japan’s Impact and Global Risks

Another significant date aside from the Fed’s decision is December 19th, when the Bank of Japan (BoJ) will announce its rate decision. Japan considering increasing its near-zero rates after over 20 years introduces a new wave of uncertainty in global finance. Hilton points out the impact of a potential Japanese rate hike on the “yen carry trade,” a significant driver of last week’s market instability. The unwinding of this strategy could reduce global risk appetite, leading to new volatility in both stocks and crypto.

Supporting this view is the latest US inflation data, which came in slightly above expectations and could deter the Fed from an aggressive rate cut process. This scenario has created a cautious outlook, particularly for Bitcoin$90,755 and altcoins.

Hilton suggests that until the Fed meeting, crypto assets might remain on a sideways path, with Bitcoin and Ethereum$3,139 holding above critical support levels, though some smaller tokens may experience stronger movements.

Current Outlook for XRP

Recently, another notable development in the XRP scene is the increased on-chain activity. A major whale address reportedly transferred over $25 million worth of XRP to an exchange. Analysts suggest that this MOVE could create short-term selling pressure but emphasize that the overall market direction this week will depend on macroeconomic developments. The price, meanwhile, continues to trade within a narrow range as of the news hour.