Wall Street has recently sent a heavy signal, focusing on 2026. Those who control the flow of capital are warning: the seemingly prosperous economy today is underlying some deep-seated adjustments.

The core issue points to unemployment. Predictions indicate that around 2026, the unemployment rate could see a significant rise — this is not just normal fluctuation, but a level that could potentially crush the entire economic cycle. Imagine the chain reactions that could follow: rising unemployment means households tighten their belts, consumer confidence collapses, companies see bleak sales prospects and cut back on investments, and the overall economic growth could plummet sharply.

Faced with such a scenario, the Federal Reserve’s remaining tools are actually limited. To stop the bleeding, they are very likely to do one thing: significantly cut interest rates. The market generally expects that by the end of 2026, interest rates could be lowered by over 100 basis points. Once this large-scale rate cut is initiated, global liquidity will be released again, and a large amount of capital will be forced to seek exits.

What does this mean for asset holders?

Think back to the stories of the past few years. After 2020, when the traditional economic engines cooled down, where did the massive liquidity flow into? History may not repeat exactly, but it often rhymes. If large-scale rate cuts and liquidity releases really happen this time, the crypto market is very likely to once again become a primary destination for these funds seeking returns and growth. After all, in a low-interest-rate environment, risk assets tend to attract investors chasing higher yields.

So here’s the question: you need to ask yourself a few things now:

How is your investment portfolio structured? If the economy truly enters a recession and the wave of unemployment hits, can your assets withstand this shock? Or will your allocations decline along with the economy?

Another perspective is that when the wave of rate cuts really sweeps in, the US dollar will gradually depreciate, and the purchasing power of traditional savings will be eroded. In this context, will your assets shrink along with the dollar, or can they serve as a hedge against inflation and currency devaluation?

Assets like ETH have shown some resilience during previous liquidity releases. There are also emerging tokens like 1000PEPE, which, although more volatile, tend to attract capital during phases of rising risk appetite.

Honestly, everyone’s judgment about this predicted storm varies. Some think it’s alarmism, as Wall Street often creates anxiety to attract attention; others believe that economists’ warnings are not unfounded, and some deep imbalances are indeed accumulating.

If 2026 unfolds according to this script, how will you choose? Will you shift fully into safe-haven assets and reduce risk exposure, or will you think contrarily and make some bottom-fishing moves while others panic? There’s no standard answer — it depends on your understanding of the economic cycle and your risk tolerance.

The key is to understand this cycle. From expansion to contraction, from tightening to loosening, capital flows will also change accordingly. Grasping this rhythm and acting at the right time will help you navigate the storm more calmly.