News from the Federal Reserve has a major influence on crypto markets because it shapes global liquidity and investor sentiment. When the Fed raises interest rates, borrowing becomes more expensive, liquidity tightens, and investors often move away from riskier assets like cryptocurrencies, causing prices to drop. On the other hand, when the Fed cuts rates or signals easier monetary policy, more liquidity flows into the market, encouraging risk-taking and often driving crypto prices higher. Additionally, Fed statements and economic outlooks can trigger short-term volatility as traders react quickly to policy signals.