The U.S. Federal Reserve has officially ended its years-long effort to drain money out of the financial system, freezing its balance sheet at about US$6.57 trillion. After removing more than US$2.3 trillion in liquidity since 2022, the Fed has now stopped quantitative tightening (QT) — a major shift that normally sets the stage for stronger financial markets and rising crypto prices.
Across the crypto world, investors have been waiting for this moment. Every major crypto cycle has been shaped by liquidity, and the end of QT is usually the first sign that conditions are turning. In 2019, when QT last ended, Bitcoin bottomed and then began a powerful recovery, rising from roughly US$3,800 to nearly US$29,000 over the following year. Many traders expected a repeat this time, hoping Bitcoin would quickly break above US$100,000.
But this cycle isn’t moving on schedule. Despite the policy shift, Bitcoin is still trading below the milestone that so many expected. And the reason is surprisingly simple:
Ending QT stops the drain — but it doesn’t refill the system.
Analysts note that even though the Fed announced the shift, the balance sheet can still edge lower in the weeks ahead because previously scheduled Treasury maturities haven’t settled yet. In other words, the tightening phase is over, but the easing phase hasn’t started. The first real uptick in liquidity may not arrive until early 2026.
That delay matters. In the last 24 hours, the crypto market has shown signs of life — up more than 7% — but the broader environment is very different from the last time the Fed ended QT. Higher interest rates, slower economic growth, and cautious investors mean Bitcoin may not repeat its previous explosive move right away.
For now, the crypto market is waiting for an actual increase in liquidity, not just the promise of one. And until that shift fully begins, Bitcoin’s path above US$100,000 will likely remain choppy.
For regular investors — especially beginners — this moment can feel confusing. The headlines say the Fed ended QT, social media says Bitcoin should skyrocket, yet the price is stuck. Here’s what that really means:
- The money pump hasn’t turned back on yet.
Ending QT stops the drain but doesn’t add cash to the system. Markets need actual liquidity to run, not just announcements. - Crypto rallies take time — sometimes months.
In 2019, the big move didn’t happen until early the next year. The same pattern is likely now. - Don’t chase hype or FOMO.
This is when many small investors make emotional decisions. Move carefully. - Only invest what you can afford to lose.
Bitcoin is volatile. A strong move may come — but timing is uncertain. - The smart play is patience.
If you believe in the long-term story, this is a “prepare and observe” moment, not a “bet the house” moment.
The Bottom Line
As the liquidity cycle slowly shifts in 2026, the environment may get more supportive for crypto. But everyday people need to stay grounded. Financial discipline still matters more than any headline — even one as big as the Fed ending quantitative tightening.