When the Federal Reserve initiates repurchase agreements to inject liquidity into the financial system, the market logic is actually quite clear—smart capital has long been seeking high-yield exits. We have seen this pattern many times: whenever an easing cycle occurs, the yields on low-risk assets plummet vertically, and high-growth, high-yield sectors will experience a wave of capital inflows. The crypto market finds it hard to remain unaffected.

Let's first clarify a basic concept: liquidity, simply put, is the amount of available funds in the market. The Fed's repurchase operations are equivalent to directly injecting cash into the blood vessels of the financial system. When the dollar supply in the market becomes sufficiently abundant, traditional bank deposits and government bond yields become too meager. Funds, like a tide, will naturally flow toward places that can generate higher returns.

Bitcoin and Ethereum, as the most controversial yet most potentially monetizable frontier assets today, often become the targets of this liquidity search. This is not speculation; there is a clear economic logic behind it: when the appeal of safe assets diminishes, investors' risk appetite will collectively expand. You will see market sentiment shift from cautious to optimistic, trading volumes on exchanges significantly increase, and the market may show consecutive strong trends. This chain reaction is brought about by liquidity release.

The most crucial point is that this policy cycle opens a time window for crypto traders to position themselves. In a liquidity-driven market, the key is to grasp three rhythms: first, identify the liquidity release phase; second, observe signals of market sentiment shifts; third, allocate risk positions reasonably. When the timing is right, the space for gains will open up.