2026-01-07 07:30:13

At the start of 2026, the global financial markets usher in a new round of policy battles. Inside the Federal Reserve, fierce debates are underway over interest rate cuts—one faction emphasizes the need to lower rates by 100 basis points this year, criticizing the current 3.75% level as excessively suppressing the economy; another hawkish faction insists on defending the inflation target, with both sides holding firm positions. Behind this debate reflects the deep-rooted dilemmas of the US economy and policy conundrums.

The truth beyond the numbers is even more worth paying attention to. The US debt of $38 trillion is like a sword hanging overhead—each 100 basis point reduction in interest rates could save about $400 billion in interest payments, and the tangible benefits are hard to ignore. In comparison, inflation concerns seem to gradually fade from policymakers’ focus.

How much does this easing expectation drive crypto assets? Just look at BTC’s performance. Currently, Bitcoin has stabilized at a high of 118,000 yuan, and market expectations for further gains are heating up, with a target of 150,000 yuan no longer a pipe dream. ETH, as the main representative of Ethereum, is also benefiting from liquidity expectations, while emerging assets like BREV are showing different performance trajectories driven by community enthusiasm.

In this highly volatile market environment, asset selection becomes especially critical. Projects with ample liquidity and strong community consensus often remain relatively stable amid shifting policy expectations. This is precisely why many investors are turning to assets with community-driven momentum.

To briefly outline the logical chain: the clearer the Fed’s interest rate cut expectations, the more abundant the market liquidity; abundant liquidity means more funds flowing into risk assets; among risk assets, leading coins like BTC, ETH, and assets with unique narratives tend to be the first choices. In the current market environment, this cycle is strengthening.

For traders paying attention to these trends, the next focus should be on the Fed’s actual policy signals, the pace of liquidity injection, and the performance differences of various assets during periods of ample liquidity. The market has never lacked opportunities; what’s missing is the ability to judge those opportunities.

BTC-2.04%

ETH-3.26%

BREV-20.52%

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.

17 Likes

Reward
17
6
Repost
Share

Comment

0/400

DeFiGrayling

· 01-07 13:59

Hawks and doves are both acting, the real winner has long been in BTC Cutting interest rates by 100 basis points saves 400 billion? Wake up, this money will eventually flow into the crypto circle, I’ve already gone all in 11.8 million still dare to hesitate, don’t regret at 15 million Community-driven assets are truly attractive, why didn’t I get on the BREV wave The Federal Reserve’s knife is always hanging over our heads, but holding BTC makes me sleep the most peacefully Instead of waiting for policy signals, it’s better to watch trading volume; where the water flows, the coins will rise 38 trillion in debt is a huge pressure, they must cut interest rates, no suspense there Old routine: liquidity injection → BTC surges → new retail investors enter → run after taking profits Ample liquidity doesn’t mean you can make money; the key is whether you can catch it Inflation has long ceased to be an issue, now it’s just about whether the Federal Reserve dares to act

View OriginalReply0

OPsychology

· 01-07 13:19

Under the pressure of 38 trillion in debt, interest rate cuts are just a matter of time. The crypto market's current rally has only just begun.

View OriginalReply0

ReverseTradingGuru

· 01-07 07:52

Ha, it's the same old tune again, the Federal Reserve prints money, and cryptocurrencies rise with the sky. Every time it's the same story. Wait, can 150,000 BTC really come? Feels like this time the expectations are too high. The community-driven momentum is indeed hot, but new projects like BREV also carry real risks. Instead of fixating on interest rate cut expectations, it's better to pay attention to when the policies will really change... that's when the test truly comes. Liquidity is a double-edged sword—useful but also risky. When it's abundant, everything can rise; when it dries up, things get even worse.

View OriginalReply0

RugPullProphet

· 01-07 07:51

The Fed folks are really stubborn—cut rates or not, basically they just want to shed their debt burden. 150,000 Bitcoins? I bet five bucks I won't see it. Community consensus is strong? Listen, that’s the easiest way to get chopped up. Ample liquidity = funds rushing around. You just have to see who runs faster. When the Fed farts, the market goes wild. This script has been played out for decades.

View OriginalReply0

Web3Educator

· 01-07 07:48

ngl the fed's just kicking the can down the road, 38 trillion in debt doesn't disappear by printing more money

Reply0

governance_lurker

· 01-07 07:47

The Federal Reserve is about to loosen monetary policy again. Is this really happening or just more hype... Will the 118,000 increase to 150,000? I'm skeptical.

View OriginalReply0