Bitcoin traded near $83,450 on Wednesday after briefly rising to $84,000, extending its recovery from Tuesday’s $80,970 low. Meanwhile, much of the altcoin market remained in negative territory as traders awaited the latest U.S. inflation figures for clues about the Federal Reserve’s next policy move.

The CoinDesk 80 index slipped 0.6% since midnight UTC, while the CoinDesk 20 gained 0.2%. Nearly two-thirds of the cryptocurrencies included in the CoinDesk 100 declined. CoinMarketCap’s Altcoin Season Index also weakened to 55 from 60 recorded a week earlier.

New York Fed President John Williams offered some reassurance by saying interest-rate increases should not be necessary in 2027. However, he did not rule out another rate hike later this year.

Investors are watching the consumer price index (CPI), which will provide the final major inflation reading before the Federal Reserve’s Oct. 28 meeting. Dow Jones economists expect annual inflation to reach 3.6%, compared with 3.4% previously, according to CNBC. Rising fuel costs remain another concern, with AAA reporting an average U.S. gasoline price of $4.34 per gallon, up from $3.08 a year ago.

In traditional markets, S&P 500 futures advanced 0.2%, while Brent crude hovered around $106 per barrel.

Futures activity declines as traders reduce risk

Crypto derivatives markets recorded a sharp slowdown in activity over the past 24 hours. Futures trading volume dropped 26% to $156.79 billion, and total open interest decreased 2.27% to $140 billion. Liquidations fell by more than 80% to $136.32 million, indicating that forced position closures had eased.

Short-side trades represented 52% of taker volume, showing that bearish positioning retained a slight edge.

Open interest in Bitcoin declined 3.5%, while Ether’s fell 2.7%. With both cryptocurrencies posting largely flat or negative price movements, the figures point to traders scaling back exposure ahead of the inflation report.

Zcash (ZEC) showed stronger activity. Its open interest increased by more than 4%, compared with a 1% rise in its spot price, suggesting that newly opened contracts accounted for roughly 3% of the increase beyond the effect of price appreciation.

ZEC also recorded positive open-interest-adjusted cumulative volume delta (CVD), while annualized perpetual funding rates approached 10%. The combination points to aggressive demand for long positions, with bullish traders paying to keep their exposure open. Canton Network’s CC token displayed a similar pattern.

Data covering the past month indicates that leverage has been moving away from Bitcoin and other major cryptocurrencies toward selected altcoins. Open interest declined across BTC and several large-cap assets but increased in NEAR and Wormhole.

Trading-flow indicators reflected a divided market. Bitcoin and TRX posted the strongest CVD readings over the past 24 hours, whereas UNI, SUI and NEAR recorded the most negative readings among major tokens. NEAR’s rising open interest alongside substantial selling pressure may point to traders building bearish positions.

Bitcoin’s 30-day implied volatility index, BVIV, climbed to 40%, exceeding its 50-day and 100-day averages. The increase suggests growing expectations of price swings and demand for hedging. Ether’s implied volatility also edged higher.

Options markets showed activity in Bitcoin puts with strike prices of $60,000, $78,000 and $75,000. For Ether, the most active contracts included calls at $3,400 and $2,600, as well as a put at $2,300.

DeFi tokens lag while selected altcoins advance

Optimism (OP) declined 4.2% after reaching its highest level since mid-May on Tuesday. The previous rally followed Uniswap’s Unichain completing its testnet migration to OP Enterprise on Oct. 13. Its mainnet migration is scheduled for Oct. 29, when Optimism is expected to operate production infrastructure, including the sequencer.

Decentralized finance assets underperformed the broader market. The CoinDesk DeFi Index (DFX) fell 1.8%, while Lido (LDO) dropped 2.9%, Jito (JTO) declined 2.8%, and Uniswap (UNI) lost 2.5%.

Other tokens also pulled back after recent gains. Starknet (STRK) fell 4.5%, Kaia (KAIA) declined 3.8%, and Celestia (TIA) slipped 3.7%. TIA had reached a 2026 peak of approximately $0.63 on Saturday.

Several assets moved higher despite the broader weakness. KITE gained 5.3%, leading the reported advances, while Pyth (PYTH) rose 4.5%. Venice (VVV), associated with a privacy-focused AI platform, added 2.4%, and Zcash gained 1.7%.