End-of-year Federal Reserve minutes cause a shock: Bitcoin approaches the $91,000 mark. Veteran traders teach you how to break the deadlock.

At dawn, global crypto investors hold their breath, watching the Federal Reserve meeting minutes — this is not only the final policy event of the year but also crucial to the life and death trajectory of the crypto market. As seasoned veterans immersed in the crypto world know, the Fed’s actions at year-end often determine the capital flow for the next 12 months.

The True Intentions of the Fed: Is Rate Cut a Smoke Screen?

On December 11, the Fed as scheduled announced a 25 basis point rate cut, bringing the federal funds rate to the 3.50%-3.75% range. On the surface, this appears to be good news, but market reactions are surprisingly nuanced.

Data on the current situation:

Bitcoin surged instantly after the announcement to around $91,170, but then entered a consolidation phase, with only a +1.09% increase in the past 24 hours; Ethereum performed slightly better, stabilizing above $3,130, with a 24-hour gain of +0.44%. This “buy the rumor, sell the fact” pattern is playing out again.

What’s more alarming is that among the 12 voting members of the Federal Reserve, 3 opposed the rate cut — 2 advocated for holding rates steady, and 1 even called for a 50 basis point cut. This is the most severe internal division in six years. Coupled with the dot plot indicating at most one rate cut in 2026, the market is beginning to realize: this could be a trap of “hawkish rate cuts.”

Three Key Signals in the Meeting Minutes

To survive this market wave, seasoned traders need to lock in three critical points:

First, the probability of continuing “pause” at the January meeting is as high as 85%

The market generally expects the Fed to maintain current policy in January. If the minutes confirm this expectation, short-term liquidity support will be severely lacking.

Second, why is there internal division within the Fed?

Understanding the reasons behind the voting split is crucial — is it concern over inflation rebounding, or worries about a soft labor market? Different reasons will lead to entirely different policy paths moving forward.

Third, the hidden “non-QE easing” signal

The Fed is simultaneously launching a “reserve management purchase” plan, with $40 billion to be invested over the next 30 days to buy short-term government bonds. Industry calls this an “implicit liquidity release.” If an upgraded version emerges in 2026, the market could face an injection of hundreds of billions of dollars in new liquidity. This is the real signal that the market has underestimated.

On-Chain Data Reveals Market Bottom Clues

Contrasting with macro panic, on-chain data is quietly sending optimistic signals:

Short-term holders have already capitulated. Over the past 30 days, short-term holders have accumulated losses exceeding $4.5 billion, second only to the Japanese yen arbitrage blow-up period in 2024. Historical experience suggests that extreme losses often signal a stage bottom.

Exchange BTC balances hit a 2018 low. Currently, on-chain exchange Bitcoin balances have fallen below 2.6 million coins, indicating investors are frantically accumulating BTC. When exchange holdings dry up, market liquidity itself becomes a scarce resource, and any positive catalyst in this environment could trigger a rebound.

Hidden Risks That Cannot Be Ignored

During the Christmas holiday, traders in Europe and America are collectively retreating, and market liquidity has plummeted. This means even small trades could cause significant volatility. Meanwhile, the Bank of Japan may face rate hike pressures, which could threaten the stability of yen arbitrage trades and impact global risk assets.

Tiered Trading Strategies

For short-term traders: Trade within the range of $86,500-$89,500 (BTC) and $2,860-$3,060 (ETH) with T+0, avoiding excessive leverage. During this period, liquidity is severely constrained, and any aggressive moves could be “whipsawed.”

For long-term holders: On-chain indicators have already reached the historical “green buy zone.” This is the classic moment to “buy more when others are panicking.” Institutional investors plan to expand their crypto allocations by 83% in 2025, and individual investors should consider deploying gradually.

For dollar-cost averaging users: Divide your funds into 3-4 parts and enter the market gradually over the next week. Around the Lunar New Year, Asian capital tends to accelerate into crypto assets, and this “Spring Festival effect” should not be missed.

The Ultimate Game: Who Will Dominate 2026 Liquidity?

The meeting minutes are just surface-level; the real long-term variable lies in personnel changes at the Fed. Powell’s term ends in May 2026, and the Trump administration is about to nominate his successor. Top contenders include Kevin Hassett, current Chair of the National Economic Council, and former Fed Governor Kevin Warsh.

The leadership transition at the Fed will ultimately determine the liquidity landscape of the crypto market in 2026. Not being bound by each meeting’s minutes and focusing on longer-term institutional shifts — this is the mindset seasoned traders should have.