The U.S. government has recently confirmed the candidate for the new Federal Reserve Chair. According to current policy expectations, the Federal Reserve may initiate a new cycle of rate cuts by 2026, with an initial forecast of 3-4 rate cuts throughout the year. This signal has obvious implications for the financial markets.

What does a rate cut mean? First, the cost of capital decreases. The real yield on the US dollar declines, prompting investors to seek higher-yielding asset allocations. Historical experience shows that whenever the Federal Reserve enters a rate-cutting phase, risk assets often present buying opportunities — this is not guaranteed, but the trend is clear.

The specific impact on the cryptocurrency market can be understood as follows: under the expectation of US dollar depreciation, Bitcoin, as a non-sovereign asset and inflation hedge, becomes significantly more attractive. Meanwhile, a rate-cut cycle is usually accompanied by abundant liquidity, which boosts risk appetite. High-volatility assets like Dogecoin also tend to attract more attention and capital inflows in such environments.

From a broader macro perspective, stocks, commodities, cryptocurrencies, and other risk assets tend to rise in tandem. The key point is: not enough people are truly participating yet. If you’ve been on the sidelines, the opportunity window might be tighter than you think. When is the best time to enter the market? That’s a question everyone asks, but there’s no standard answer — only a clear understanding of your own risk tolerance.

What’s your view on this cycle? Can rate cuts push up cryptocurrency prices as expected? Feel free to share your judgment.