Assets viewed as alternatives to the U.S. dollar strengthened as the currency came under pressure from a sharp decline in hawkish Federal Reserve expectations. Analysts had previously assumed that officials could raise interest rates twice this year because of the risk of accelerating inflation amid the energy crisis caused by geopolitical tensions in the Persian Gulf, especially as the U.S. economy continued to show resilience. In September, the manufacturing business activity index rose from 53.9 points to 57.0 points, the services index increased from 56.5 points to 58.7 points and the composite indicator advanced from 56.0 points to 58.4 points, while gross domestic product (GDP) grew at an annualized rate of 2.2% in the second quarter. Nevertheless, the headline personal consumption expenditures price index remained at 3.4% in August instead of the expected 3.7%, while the core reading was 3.0% compared with forecasts of 3.3%. Commenting on the outlook, Federal Reserve Bank of New York President John Williams said there was no urgent need to adjust borrowing costs.
The September labor market report, which had still been pending in the original version of this review, has now been released. Nonfarm payrolls increased by only 29.0 thousand, well below the consensus estimate of 90.0 thousand, while the unemployment rate rose from 4.1% to 4.2%. Following the report, the probability of an interest-rate increase at the October meeting fell to approximately 14.0%, according to the CME Group FedWatch Tool, putting additional pressure on the U.S. dollar.
Nevertheless, the positive dynamics of the cryptocurrency sector remain limited by the possibility that the regulator could still raise interest rates in December, as inflation remains significantly above the 2.0% target. CME pricing indicated a 72.5% probability of at least one 25-basis-point increase by December. Another setback in efforts to reach a diplomatic settlement in the U.S.–Iran conflict also preserves the risk of renewed large-scale hostilities in the Persian Gulf, which could trigger another rise in oil prices and strengthen inflationary pressure.
Among the positive developments this week was the continued development of a regulatory framework for the digital-asset industry, despite the CLARITY Act failing to clear a procedural vote in the Senate rather than being rejected in a final vote. The U.S. Securities and Exchange Commission (SEC) also proposed new custody rules that would allow investment advisers and regulated funds, under specified conditions, to hold crypto assets through self-custody arrangements or with state-chartered trust companies. SEC officials said the changes could give regulated funds broader opportunities to offer cryptocurrency-related investment strategies while maintaining investor safeguards.
The sector was negatively affected by security statistics attributed to blockchain security and smart-contract audit company CertiK. According to the report, 247 Web3 security incidents occurred in the third quarter, resulting in losses of 1.26 billion dollars, while losses since the beginning of the year reached 2.68 billion dollars. September was the worst month of the quarter, with 99 incidents and losses of 768.5 million dollars, the highest monthly total reported in 2026. These figures cover a broad range of Web3 security events, rather than wallet hacks alone, but they still highlight persistent weaknesses in the protection of digital assets and may weigh on demand.
Overall sentiment in the cryptocurrency industry is improving, supported by renewed investment in exchange-traded products and readings of approximately 70–74 for the Crypto Fear & Greed Index, within the “greed” zone. Under these conditions, the market may resume its advance or remain in consolidation next week, although changing interest-rate expectations and geopolitical risks are likely to keep volatility elevated.
