Major Cryptocurrencies Surge Ahead of Fed Meeting: What’s Driving the Rally?
By John Nada·Mar 17, 2026·4 min read
Major cryptocurrencies gained significantly last week, driven by derivatives and ETF inflows. Bitcoin's volatility ahead of the Fed meeting highlights market dynamics.
Major cryptocurrencies have posted significant weekly gains as Bitcoin briefly tested $75,000, influenced largely by derivatives activity and ETF inflows. Ether surged 13%, XRP rose 11%, and Solana climbed 9.7% over the past week, marking the broadest rally since before the Iran war.
The Bitcoin price volatility, which saw a brief rise above $75,000 before retreating, seems primarily driven by derivative market positioning rather than fresh demand in the spot market. This surge was fueled by the closure of large put positions which required market makers to buy spot Bitcoin to rebalance their portfolios. Traders are cautious, as evidenced by the rapid pullback below the critical support level of $74,400, indicating a lack of fundamental catalysts to sustain prices above previous highs.
Despite the volatility in Bitcoin's price, other major cryptocurrencies have also demonstrated resilience. Each of the top tokens logged gains of at least 5% over the past week, which is a significant indicator of renewed investor confidence in the broader market. With Ether climbing 13.3% to $2,316, XRP reaching $1.53 after an 11% increase, and Solana gaining 9.7% to $93.92, the overall momentum is notable. Even Dogecoin saw a resurgence, adding 9.5% to trade above a dime. This collective performance showcases a robust market environment, drawing parallels to previous bullish phases.
Institutional interest is undeniable, with approximately $767 million in net inflows into spot Bitcoin ETFs last week, marking the third consecutive week of positive flows after a substantial outflow period earlier this year. This resurgence is reviving the “digital gold” narrative, especially as Bitcoin's performance narrows the gap with gold. The correlation between Bitcoin and gold has shifted significantly, suggesting that investors may be reconsidering Bitcoin's role as an asset class amid macroeconomic uncertainties. Year-to-date through mid-March, GLD returned roughly 16% while IBIT lost approximately 19%. The narrowing gap indicates a renewed interest in digital assets as a hedge against inflation, particularly in light of the Fed's impending decisions.
The upcoming Federal Reserve meeting, which is widely anticipated, is expected to set the tone for risk assets in the following weeks. Current market predictions indicate a strong likelihood of the Fed holding interest rates steady, but the focus will be on the Fed's dot plot and Chairman Powell's comments regarding economic pressures. With inflation concerns mounting and labor market indicators showing signs of weakening, how the Fed navigates these challenges will be crucial for market sentiment and could impact crypto and traditional assets alike. The CME FedWatch tool currently prices a 95%+ probability of a hold at 3.5% to 3.75%, suggesting that while the decision itself may be a non-event, the subsequent discussions will have far-reaching implications.
Further, the performance of XRP has been noteworthy as it broke through the $1.50 resistance, reclaiming the fourth spot by market capitalization with about $93.4 billion. Open interest in XRP futures has increased significantly, indicating that traders are embracing leveraged positions as they anticipate continued upward momentum. This trend, while offering structural support, also raises the stakes given the potential for increased volatility in the event of a market correction. Open interest in XRP futures on Binance has surged by 59% since late October, signaling that traders are adding leverage into the rally rather than unwinding positions, even as the token trades 37% below its previous high.
The convergence of Bitcoin's performance with gold, alongside the substantial ETF inflows, suggests a renewed interest in digital assets as a hedge against inflation. As the Fed prepares to unveil its policy direction, the interplay between traditional and crypto markets will be a focal point for investors, reflecting broader economic conditions. Mark Pilipczuk, a CF Benchmarks analyst, highlighted that the institutional flow data underneath this rally is significant and increasingly difficult to dismiss. The evolving narrative around cryptocurrencies, particularly Bitcoin, is gaining traction again in the face of economic uncertainty.
Investors should keep a close watch on how the Fed addresses the current economic landscape, as every detail from its meeting could influence market dynamics significantly. The implications of this meeting extend beyond immediate price reactions; they will shape the discourse around risk assets and the evolving perception of cryptocurrencies in the investment landscape. As the market braces for potential outcomes from the Fed meeting, the ongoing developments in the cryptocurrency space will likely reflect these macroeconomic shifts, presenting both opportunities and challenges for investors navigating this volatile environment.