🔴🟢🔵 Are we on the brink of a new wave of cryptocurrency rise 🚀
In a move not seen in years, the U.S. Federal Reserve announced on December 22, 2025, an injection of liquidity worth 68 billion dollars through repurchase agreements known as "repo" 💸
This is the first time the Fed has intervened using this mechanism since the COVID crisis of 2020, raising wide-ranging questions about the implications of this step and its reflections on financial markets, including the cryptocurrency market 🌐
💡 What are repurchase agreements and their importance?
At its core, repo agreements involve the Fed lending banks money in exchange for high-quality collateral, often U.S. Treasury bonds 🏛️
And the banks return the amount within a day or a few days to recover their collateral
The goal is clear: to ensure the stability of liquidity flow and prevent a sudden rise in short-term interest rates ⚖️
📌 Why now?
As the end of the year approaches, banks face increasing pressure to boost their reserves and meet regulatory requirements, tightening liquidity in the markets 🔒
And that’s why the Fed intervenes not as a means to stimulate the economy but as a fan to ventilate the market and keep it in a state of daily balance ⛓️
📊 In numbers
The average size of the secured overnight financing market SOFR in 2025 was about $27 trillion daily
And more than a trillion dollars of it relies on repo operations
Therefore, the $68 billion operation is not huge in size but carries significant symbolic meaning as it is the first in years 📉➡️📈
⚠️ Do not confuse repo with quantitative easing
It is important to distinguish between the temporary mechanism by which repo operations work and the quantitative easing policy that injects permanent money into the economy
Here, there is no money printing or change in overall monetary policy
But it signals that the liquidity arteries in the market are experiencing some tightness 🩺
🔄 What does this mean for digital currencies?
Despite the technical nature of the process, cryptocurrency investors read it as a positive signal 📣
Because any increase in global liquidity opens the door for money to flow towards higher-yielding assets like Bitcoin, Ethereum, and other cryptocurrencies 💥
As the famous analyst TheMoneyApe commented
More money in the system means easier financing, less pressure, and better conditions for risky assets like Bitcoin and digital currencies 🪙
🔮 What’s next?
The Fed remains committed to its restrictive policy in its efforts to bring inflation back to its target of 2%
But this step and the additional purchases he started on December 11 worth $40 billion to manage his portfolio paint a more complex picture 🎭
Are we looking at the beginning of a new quantitative easing in early 2026?
Is this just a seasonal artistic breath for the end of the year?
The answer will become clear in the coming weeks through inflation data and officials' statements 📅
👀 Keep it in mind
Even if the repo is not quantitative easing, the market reacts to every liquidity point injected by the central bank
History shows that cryptocurrency markets tend to rise in liquidity-filled environments
So are we witnessing a historic upward wave in early 2026?
Time will tell 🕰️
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