The financial markets in 2025 are indeed putting on a grand show. The Federal Reserve has just completed three rounds of rate cuts, bringing interest rates down to the 3.5%-3.75% range, but the voting split was the largest in six years—9 votes in favor versus 3 against. The details in the meeting minutes are even more worth pondering: service sector inflation is more sticky than expected, still far from the 2% target, and the rate cut plan for 2026 surprisingly only includes one cut. Such internal disagreements are themselves signaling something.

Bitcoin and the entire crypto market are the most sensitive to this. Every previous rate cut cycle was accompanied by sharp volatility—price surges followed by rapid declines of 1.23%, and cases where 130,000 traders were liquidated are not uncommon. Now, with such clear internal divisions within the Federal Reserve, the future policy expectations are even more uncertain.

Another force is acting more aggressively. There are reports that officials are beginning to discuss including a major mainstream cryptocurrency in strategic reserves, a concept that is increasingly taken seriously by the end of 2024. Meanwhile, political figures are openly stating they want to cut interest rates directly to 1%, and there is even pressure on current decision-makers. The selection of the new chairperson is crucial—market predictions suggest the probability of nominating a dovish official exceeds 47%, and another candidate with a rate-cutting stance is also highly favored. What does a direct cut from 3.75% to 1% mean? Massive liquidity release, with risk assets bearing the brunt—Bitcoin soaring to 120,000 is not a pipe dream; but if such political interference damages decision-making independence, undermines the dollar’s credibility, and causes systemic risks in crypto assets, then scenarios like a 30% monthly retracement or 180,000 liquidations could repeat.

The key moment is imminent. The December 30 meeting minutes will give directional signals, and the new chairperson will be decided in the first week of January, gradually clarifying the overall policy trajectory for 2026. The current crypto market is essentially betting on this series of uncertainties: will rate cuts really happen? How large will the cuts be? What stance will the new decision-making team take?

One reality is that rate cuts do not automatically mean a bull market, and loose liquidity does not necessarily serve as a safe haven for risk assets. Many assets are now supported by narratives and expectations; once expectations reverse, the risk of a sudden crash is very real. The next three months could be critical for the entire ecosystem. What do you think about this series of moves? Will Bitcoin’s target price be 120,000 or return to 80,000? How will the new chairperson influence the policy tone in 2026?