[The factor that may truly shape the next asset market cycle might not be rate cuts]
The market is currently used to focusing on when the Fed will cut rates, but the bigger variable is actually: the U.S. fiscal deficit and the supply of Treasury bonds.
Even if the Fed starts cutting rates, if long-end Treasury yields stay elevated due to massive supply, financial conditions may not genuinely loosen.
That’s why “rate cuts” and “liquidity easing” can’t be equated.
A decline in short-term interest rates signals a shift in monetary policy; but if long-end yields, term premia, and the dollar remain relatively strong, the cost of capital may still stay high.
For high-beta assets like BTC and ETH, what truly matters is whether global U.S. dollar liquidity improves—not just the Fed Funds Rate.
So what the market should really watch next is not only the FOMC, but:
U.S. Treasury issuance → long-end yields → the U.S. dollar → financial conditions → global risk assets.
Only if this chain begins to reverse could a truly meaningful liquidity rally form.
The easiest thing for the market to trade is “rate-cut expectations,” but the most worth researching is “where does the liquidity actually come from?”
$BTC $ETH $BNB
The market is currently used to focusing on when the Fed will cut rates, but the bigger variable is actually: the U.S. fiscal deficit and the supply of Treasury bonds.
Even if the Fed starts cutting rates, if long-end Treasury yields stay elevated due to massive supply, financial conditions may not genuinely loosen.
That’s why “rate cuts” and “liquidity easing” can’t be equated.
A decline in short-term interest rates signals a shift in monetary policy; but if long-end yields, term premia, and the dollar remain relatively strong, the cost of capital may still stay high.
For high-beta assets like BTC and ETH, what truly matters is whether global U.S. dollar liquidity improves—not just the Fed Funds Rate.
So what the market should really watch next is not only the FOMC, but:
U.S. Treasury issuance → long-end yields → the U.S. dollar → financial conditions → global risk assets.
Only if this chain begins to reverse could a truly meaningful liquidity rally form.
The easiest thing for the market to trade is “rate-cut expectations,” but the most worth researching is “where does the liquidity actually come from?”
$BTC $ETH $BNB