#创作者冲榜 How Does the Federal Reserve "Control" the Crypto Market? Not Through Direct Suppression, But by "Draining the Economic Foundation"

Many crypto players have a misconception: they believe the Federal Reserve doesn't directly regulate cryptocurrencies, so its policies have little impact on the crypto market. But the reality is quite the opposite. The Federal Reserve's interest rate policy is the "core variable" affecting crypto price movements. It doesn't act directly, but can determine the life and death of the crypto market through "draining the economic foundation." There's only one core logic: the rise of cryptocurrencies is essentially "liquidity-driven." When the Federal Reserve cuts rates and releases liquidity, more idle capital enters the market. Some funds flow into the crypto market—a high-risk, high-return market—pushing up cryptocurrencies like Bitcoin. Conversely, when the Federal Reserve maintains high interest rates and tightens liquidity, funds flow out of the crypto space back into traditional financial markets, putting downward pressure on cryptocurrencies. We can verify this logic by examining recent market performance: After the Federal Reserve maintained rates in the 3.5%-3.75% range unchanged, US Treasury yields soared, and the S&P 500 fell 1.36%, marking the largest single-day decline following a Federal Reserve speech since 2024 began. Traditional stock market declines mean reduced market risk appetite and capital fleeing for safety. As a high-risk asset, the crypto market naturally cannot stand alone—Bitcoin's sharp decline directly reflects this market sentiment.

More critically, the Federal Reserve's "hawkish stance" also affects institutions' confidence in allocating to cryptocurrencies. While US spot Bitcoin ETFs saw net inflows exceeding $750 million last week and over $400 million in inflows this week, this appears to be a recovery in institutional confidence. However, this is merely "flash capital" engaging in short-term behavior, not long-term positioning. Importantly, when institutions allocate to cryptocurrencies, they prioritize the "liquidity environment." When the Federal Reserve maintains high interest rates, institutions worry about rising capital costs and increased market volatility, reducing their crypto allocations or even selling holdings. This is why Glassnode reports show that on-chain activity remains sluggish and overall market confidence hasn't fully recovered.

We need to correct another misconception here: some believe that with Middle Eastern tensions heating up, Bitcoin will ultimately become a "safe-haven asset," like gold. But recent market performance shows the opposite. Bitcoin not only hasn't risen; it's declining along with stock markets. The reason behind this is the Federal Reserve's high interest rate policy, which completely suppresses Bitcoin's "safe-haven properties." In an environment of tightening liquidity, any high-risk asset will be abandoned by capital, even amid geopolitical tensions, making it difficult to serve as a "safe harbor." As Marcus Thielen, founder of 10x Research, noted, when loose monetary policy ends, the speculative rally in cryptocurrencies recedes. It's no longer viewed as a "hedge against currency devaluation," but rather as an "overspeculative asset."

Not Just the Federal Reserve! These 3 Categories of Global Data Are the Crypto Market's "Rise and Fall Switches"

If the Federal Reserve is the crypto market's "biggest operator," then various types of economic data and geopolitical events globally are the crypto market's "rise and fall switches." Many people only focus on Federal Reserve rate-cut expectations, overlooking these data points. Ultimately, they chase rallies and sell dips in panic, losing everything.

Today, we'll identify the 3 categories of global data with the greatest impact on crypto markets. After reading this, you'll understand which factors besides the Federal Reserve determine Bitcoin's rise and fall.

Category One: Inflation Data (PPI, CPI, Core PCE)—Directly determines the Federal Reserve's policy direction, which in turn impacts the crypto market. We've already seen how February's PPI explosion directly intensified the Federal Reserve's "hawkish stance," triggering Bitcoin's crash. Beyond this, the US CPI (Consumer Price Index) and Core PCE (Personal Consumption Expenditures Price Index) are the "core reference points" for the Federal Reserve's rate-setting policy. Core PCE is called the "Federal Reserve's favorite inflation indicator." If Core PCE continues to exceed expectations, the Federal Reserve won't just refrain from cutting rates; it might even continue raising them, which would be devastating for the crypto market. Conversely, if Core PCE declines and inflation pressure eases, the Federal Reserve's policy may become more dovish, giving the crypto market breathing room. Additionally, inflation data from major economies like Europe and Japan will affect the global liquidity environment, indirectly impacting the crypto market.

Category Two: Energy Price Data (Oil prices, natural gas prices)—Indirectly impacts the crypto market by affecting inflation. After the Middle East conflict escalated, oil prices soared. Energy price increases directly push up global inflation, forcing central banks worldwide to maintain high rates and tighten liquidity. Citigroup analysts even predict that Brent crude could rise to $120 per barrel in the coming days. If the Strait of Hormuz remains closed for extended periods, average prices in Q2 and Q3 could reach $130 per barrel. Sustained oil price increases not only aggravate stagflation risks but also affect global economic growth, reducing market risk appetite. As a high-risk asset, cryptocurrencies will naturally face headwinds. Conversely, if oil prices decline and inflation pressure eases, market risk appetite will recover, presenting a rebound opportunity for the crypto market.

Category Three: Geopolitical Events (Middle East conflicts, global trade frictions)—Trigger market emotions in the short term, causing violent crypto market fluctuations. The recent Iranian gas field attack and Middle East conflict escalation are typical examples. After the event, oil prices soared, panic spread through markets, and Bitcoin crashed. However, it's important to note that geopolitical events' impact on the crypto market is mostly "short-term." Once the event cools down and market sentiment stabilizes, the crypto market returns to the core logic of "macroeconomic liquidity."

Beyond these, two other categories of data deserve close attention: First, crypto market-specific data, such as ETF fund inflows/outflows, on-chain activity, and liquidation data. Continuous ETF fund inflows suggest recovering institutional confidence, a bullish signal. Sluggish on-chain activity indicates low trading activity and weak confidence.

Second, monetary policies from major global economies, such as rate decisions from the European Central Bank and Bank of England. Their policy directions affect global liquidity, indirectly impacting crypto markets.