As investors await the Fed's decision, cryptocurrencies plummet, causing bitcoin to drop below $67,000.

On Tuesday, cryptocurrencies fell as bitcoin continued its recent decline and investors waited for the Federal Reserve's next rate announcement.

According to Coin Metrics, the price of Bitcoin dropped more than 4% to $66,475, extending a decline that began on Friday when Bitcoin retreated from the $70,000 level.

Cryptocurrencies and crypto-related equities experienced a 6.1% decline to $3,452.02, with miners and both losing more than 4%.

The wave of long liquidations may have caused Bitcoin losses, as traders were forced to sell their assets at market price to settle their debts. In the past 24 hours, $56 million in long Bitcoin liquidations have been recorded on centralized exchanges, according to CoinGlass.

On Thursday, the market witnessed another $56 million in long bitcoin liquidations, prior to the release of the better-than-anticipated May U.S. jobs report on Friday. Following a brief test of $70,000 at the start of the month, bitcoin fell back below this level.

Crypto traders, like stock market investors, are concerned that the Federal Reserve may not lower interest rates this year, as the central bank's two-day policy meeting is underway and its decision is expected on Wednesday. On Tuesday, the Dow Jones Industrial Average lost 272 points, while the S&P 500 fell 0.3%.

"Bartosz Lipiński, CEO of Cube.Exchange, stated that when equities sell off, other risk assets tend to follow. He believes that this is due to a loss of confidence in the Federal Reserve's decision to cut interest rates soon, as well as growing concerns about the long-term effects of high rates."

"Although one can see long-term expectations for a rally from options positioning, we may still experience volatility until there is a clearer understanding of the Fed's plans for the rest of the year."

The ongoing market malaise is further supported by the sell-offs on Tuesday and last Friday, as stated by Lipiński.

"Although ETH ETFs appear to be close to launching in the U.S., there has been no significant factor to push prices upward."