Recently, debates over the Federal Reserve's interest rate policy have once again become the focus of global capital markets. U.S. President Trump publicly expressed his hope to lower the federal funds rate to 1%, which stands in stark contrast to the Fed's current policy rate of 3.5%-3.75%. Behind this policy contest lies a profound impact on the future trajectory of the crypto market.

Disagreements on Interest Rate Policy

The Trump administration advocates for rapid rate cuts to stimulate economic growth, while the Federal Reserve prefers a cautious, gradual approach. The current Fed Chair's term extends until 2026, with board members serving until 2028, indicating that this policy dispute could last for some time. Renovation costs for the Fed headquarters (over $2 billion) have also become a focal point in policy discussions, sparking debates about institutional spending and market liquidity.

Potential Impact on the Crypto Market

If the Fed ultimately adopts a more aggressive rate-cutting policy, the accommodative monetary environment will increase market liquidity. Historical data shows that low-interest-rate environments typically boost the performance of risk assets, including cryptocurrencies like Bitcoin. Investors seeking returns often increase allocations to alternative assets.

Conversely, if policies fall short of expectations, concerns about the Fed's independence could trigger risk sentiment adjustments. In such cases, highly speculative projects may face significant downside pressure.

Strategic Choices

In the face of such uncertainty, investors should be more cautious in selecting assets. Projects with real-world applications and cash flow support are relatively more resilient to risks. DeFi and infrastructure projects, being sensitive to funding costs, may exhibit greater volatility under different interest rate environments.

In contrast, projects lacking real backing and relying solely on narratives tend to be the first to suffer during market corrections. Crypto assets built on genuine business fundamentals are more likely to maintain value amid long-term fluctuations.

The current focus should be on understanding the relationship between policy expectations and market pricing. Whether Trump's rate-cutting proposals will gradually evolve into actual policies remains to be seen. During this process, staying attentive to macroeconomic conditions and maintaining fundamental analysis of projects are key to risk management.

Now, it’s up to each individual to make a judgment: in the face of such policy uncertainties, is your strategy to actively seek opportunities, patiently wait for clearer signals, or prioritize protecting existing gains?