First, does the interest rate cut have an impact?

One,

There must be an impact! Those who ask this question are generally not from the crypto space.

If you are in the crypto space, you should know that before the interest rate cut is fully implemented in September,

Each fluctuation in the cryptocurrency space is influenced by interest rate cut news.

Big drops on May 1st, June 18th, July 5th, August 5th, September 4th.

Each time, the market reacts to the release of U.S. economic fundamental data.

Then the Federal Reserve's subtly dovish or hawkish statements

Master Bao has taken the art of language to the extreme.

First half dovish, second half hawkish.

Dovish in language, hawkish in action.

In short, after a lot of confusion, the market seems to understand but doesn't fully grasp it.

People's expectations for interest rate cuts fluctuate.

This expectation directly drives the ups and downs of the cryptocurrency circle, like a roller coaster.

Two,

How exactly does it affect?

Cryptocurrencies are divided into two types.

Bitcoin, which we commonly refer to as 'big cake', BTC

The second type is what we commonly refer to as altcoins. The leader among altcoins is Ethereum, or ETH.

The reason Bitcoin is classified separately is that Bitcoin accounts for 50-60% of the total market value of cryptocurrencies.

At the moment of writing, Bitcoin's market share is approximately 57.5%. So we classify Bitcoin separately.

As a discussion.

Bitcoin has no fundamentals. Initially introduced as a P2P tool, now no one uses it for transactions.

Transfer. The reason is simple; it's too expensive.

But Bitcoin, as the value consensus of the global cryptocurrency community, is the anchor of value in cryptocurrencies.

What affects the price of Bitcoin?

The most direct impact is the global capital liquidity.

We often use the M2 of the global capital market to characterize global market liquidity.

Basically, this is how it is.

Of course, if you don't research overseas markets, you don't need to worry about how to find or look at this chart.

You just need to know that the peak of global liquidity is the peak of BTC prices, and that's it.

In short, you just need to know that the global M2 directly reflects global liquidity.

And the global liquidity directly affects the price of Bitcoin, that's it.

So how does the Federal Reserve's interest rate cut affect the price of Bitcoin?

Smart investors, you must know

The Federal Reserve's interest rate cut will directly affect global liquidity.

Why does the Federal Reserve's interest rate cut affect global liquidity? Can it be quantified?

Of course, it can be approximated and quantified.

Similarly, we will use the M2 of the U.S., Europe, China, and Japan to approximate the situation.

Global liquidity,

That is also very accurate.

I won't show it here.

Three,

Will Bitcoin hit a new high?

This is an inevitable event!

But it won't happen immediately.

With the continuous release of global liquidity, it is expected that in 2024,

The Federal Reserve cuts interest rates by 75-100 basis points.

In 2025, the Federal Reserve will cut interest rates by 75-100 basis points.

By 2025, the world may release $6-8 trillion in liquidity (this number has no reports)

This is calculated by myself; please let me know if you quote it.

And the liquidity of traditional capital markets will continuously flow into the cryptocurrency market.

Driving the price of Bitcoin higher

It is almost certain that there will be a breakthrough of the previous high of 74,000.

And it will happen before the end of 2025.

Four

I won't explain finer details like bull and bear cycles.

This answer is not meant for experts.

This is mainly an explanation for new investors.

Let's not argue about it.