The New York Fed recently announced a major decision: transforming the repurchase agreement tool offered to large banks into a permanent mechanism, while removing the original $500 billion limit. What does this move mean? Simply put, the liquidity faucet has been fully opened.

Why do this? On the surface, there are three reasons: first, to prevent another "cash crunch" like in 2019, ensuring market liquidity regardless of interest rate fluctuations; second, to inject liquidity while shrinking the balance sheet, essentially providing a bottom support for market risks; third, and most crucial for the crypto space—highly volatile markets inherently need liquidity to drive them, and this policy adjustment undoubtedly supplies the market with ample "ammunition."

From an investment perspective, this policy shift will trigger chain reactions. In the short term, risk assets are likely to benefit first, especially high-volatility assets like BTC and tech stocks in traditional markets. In the medium term, close attention should be paid to inflation data—so much new liquidity will eventually need an outlet, and liquidity typically flows to the least resistant areas.

Deeper logic suggests that in a loose liquidity environment, the attractiveness of high-quality assets will continue to rise. Leading crypto assets like BTC and ETH often perform better during this period. However, it’s important to rationally recognize that behind liquidity dividends, there is usually a consumption of policy adjustment space. The sweeter the "candy" today, the more intense the "medicine" may be when policies are revised in the future.

Key questions worth pondering: Is this the start of a new global liquidity cycle, or the last calm before a larger wave of volatility? Will next year's mainstream asset performance be dominated by cryptocurrencies, or determined by traditional financial markets? Market opinions vary—what is your judgment?