Bitcoin trapped in the expectation trap: The change of $400 billion USD from the Fed is the key

Bitcoin is currently trading at $90.79K (-0.17% in 24 hours), but beneath that quiet surface, a tense conflict is unfolding between forced selling pressures and puzzling accumulation signals. Instead of focusing on the Fed’s interest rate decision this week, what truly matters are the signs indicating whether the U.S. central bank will begin rebuilding its reserves—a transition worth hundreds of billions of dollars.

Why Labor Data Suddenly Becomes a Trap

The labor market is weakening faster than inflation, creating a complex policy dilemma for the Fed. Non-farm payrolls have declined in 5 of the past 7 months, while voluntary resignations and hiring rates are also decreasing. This means that a “soft landing” is no longer the only viable scenario.

Powell will have to balance two conflicting needs: maintaining labor market stability while protecting credibility against inflation. This is the strategic trap the Fed faces, and Bitcoin will be directly affected by how they manage to escape it.

The End of QT: An Opportunity to Change the Game

On December 1, the Fed officially ended its Quantitative Tightening (QT), closing a prolonged phase during which the agency withdrew nearly $2.4 trillion from its balance sheet. As a result, bank reserves have fallen to concerning levels, and the SOFR interest rate has repeatedly tried to go beyond policy limits.

However, what truly matters is not the 25 basis point rate cut, but the Fed’s plan for what comes next. The Fed is expected to announce a strategy called “Reserve Management Purchases” (RMP)—a program anticipated to start as early as January 2026.

This program will involve purchasing about $35 billion in Treasury bonds each month, thereby rebuilding reserves and shortening the maturity of solutions within the system. The ultimate outcome: an annual balance sheet expansion of over $400 billion.

Bitcoin Follows Liquidity Cycles, Not Interest Rates

History shows that Bitcoin closely tracks liquidity cycles rather than changes in interest rate policies. This explains why the US M2 money supply—broadest measure of money—just hit a record $22.3 trillion, surpassing the 2022 peak after a long contraction.

If Powell confirms that reserve rebuilding is imminent, Bitcoin’s sensitivity to balance sheet dynamics will quickly return to a prominent level. This is the technical-political moment the market has been waiting for.

Inside: Quiet Accumulation Amid Selling Pressure

On-chain data reveals a dual story. On one hand, short-term coin holders continue to sell while weak, with miners holding about 6.5 million BTC unrealized losses, and production costs nearing $74,000. Mining difficulty has also decreased significantly since July 2025, indicating marginal operators are scaling back.

On the other hand, large wallets have accumulated around 45,000 BTC in the past week. Exchange reserves continue to decline, and stablecoin flows suggest investors are waiting for better conditions. The combination of forced distribution and strategic accumulation—this pattern often forms the foundation for sustainable market bottoms.

Two Scenarios That Could Change the Entire Next Move

Optimistic Scenario: If Powell clarifies that reserve rebuilding is the next step and the labor market remains a primary concern, Bitcoin could break above $93,500 and move toward $100,000, $103,100, and longer-term moving averages. This would signal traders are preparing for a genuine liquidity expansion.

Cautious Scenario: If Powell emphasizes caution or delays clarifying the RMP, Bitcoin could be pulled back to the $82,000–$75,000 zone, where structural demand levels—including ETF thresholds, corporate treasuries, and historical zones—are heavily concentrated.

Cross-Correlation Reveals Key Achievement

Gold and Bitcoin have recently traded inversely, not because of overall risk volatility, but due to changes in liquidity expectations. This indicates that market sentiment is truly focused on the Fed’s balance sheet strategy, rather than typical fear or greed.

Bitcoin is caught in this expectations trap—waiting for an announcement that could reset the entire crypto market momentum in 2026. The Fed’s press conference this week will be the decisive moment.