US Fed Ends QT with $13.5 Billion Liquidity Pump, Crypto Market Rally Ahead?

By officially putting an extremity to the quantitative tightening (QT) connected Dec. 1, the US Federal Reserve has initiated the archetypal steps for liquidity expansion. Market experts spot this arsenic a stepping chromatic for the adjacent large crypto rally.

The US Federal Reserve injected $13.5 cardinal into the banking strategy done overnight repurchase agreements. This marks the second-largest single-day liquidity cognition since the COVID-19 crisis. The determination besides exceeds the highest repo injections recorded during the Dot-Com bubble.

The cognition signals heightened short-term backing request wrong the banking sector. This could yet bode good for risk-on assets specified arsenic US equities and adjacent the crypto market.

The Federal Reserve has officially halted its Quantitative Tightening programme arsenic of December 1, 2025, marking a notable displacement successful US monetary policy. The determination comes aft the cardinal slope withdrew astir $2.4 trillion from the fiscal strategy since the tightening rhythm began successful June 2022. However, conscionable up of the Fed officially ending QT, the crypto marketplace faced a large pullback.

Fundstrat’s Tom Lee said the Federal Reserve’s determination to halt quantitative tightening would beryllium a turning constituent for the crypto market. Lee noted that the past clip the Fed ended QT, markets rallied astir 17% wrong 3 weeks.

Moreover, Lee believes that this displacement is peculiarly applicable for Bitcoin

, arsenic improved liquidity historically supports stronger show successful hazard assets. He expects marketplace conditions to fortify into year-end and is projecting a imaginable caller Bitcoin all-time precocious by precocious January.

Following the extremity of QT, everyone is eagerly eyeing the Fed complaint cuts scheduled up during the December FOMC. But connected the different hand, marketplace expert Ted Pillows noted that the probability of a Bank of Japan (BOJ) complaint hike astatine the December gathering has climbed to 81%.

The BOJ has raised rates 3 times successful the existent tightening cycle, successful March 2024, July 2024, and astir precocious successful January 2025. Pillows highlighted that each of these complaint hikes was followed by a wide selloff successful Bitcoin and the wider crypto market.

Read archetypal communicative US Fed Ends QT with $13.5 Billion Liquidity Pump, Crypto Market Rally Ahead? by Bhushan Akolkar astatine Coinspeaker.com