Recently, Trump's statements about the new Federal Reserve Chair "significantly cutting interest rates" have caused a stir in the market. Many investors' first reaction is "lower interest rates mean crypto prices will rise," but this simple cause-and-effect relationship may overlook more complex market logic.

On the surface, expectations of rate cuts will drive traditional funds to seek higher-yield assets, and cryptocurrencies, as high-volatility assets, will naturally attract attention. However, this time the situation may be more subtle—behind Trump's high-profile remarks lies a desperate need for economic growth. This is not just a simple liquidity release but more like a systemic shock to the foundation of the dollar's value.

From a deeper perspective, when the rate cut signals are transmitted to the market, the decay of the dollar's purchasing power will inevitably accelerate. In such an environment, Bitcoin's positioning as "digital gold" will face a real test. Can it become a hedge asset, or is it just another risk asset? The answer to this question directly relates to your allocation strategy.

**The key is how to respond**

First, discard single-minded thinking. Rate cuts are not an all-powerful positive signal; they symbolize the dilution of sovereign credit and the beginning of a reassessment of digital asset values. Your portfolio structure determines your position in this game.

Second, reassess your position allocation. In rapidly changing markets, chasing gains and selling losses is often the biggest trap. A relatively prudent approach is to keep your core holdings in Bitcoin and Ethereum, which have relatively strong market consensus and risk resistance. At the same time, reserve some positions for flexible operations, capturing opportunities when the altcoin cycle starts, but leverage use must be cautious—risk management precision determines ultimate returns.

Third, develop information discernment skills. Every move by the Federal Reserve will be overinterpreted by the market. Cross-verify information from three dimensions: political economy, central bank independence, and inflation data, rather than making decisions based on a single news item.

When the market experiences intense volatility, the real difference is not in reaction speed but in whether you understand the underlying logic. Before the tide truly arrives, those who are well-prepared often stand on the right high ground.