The US Federal Reserve has officially ended its quantitative tightening (QT) program. This pivotal move could change the trajectory of assets like Bitcoin.
Notably, this decision signals the start of a new liquidity expansion phase, a change that has historically driven stronger rallies in stocks and cryptocurrencies.
As part of this transition, the Fed used overnight repo transactions to add more than $13 billion to the banking system, making it the second largest liquidity move by the U.S. apex bank since the 2019 coronavirus pandemic.
BREAKING NEWS: The Fed has officially ended quantitative tightening (QT). pic.twitter.com/EC9wQLeaxo
— Kobeissi Letter (@KobeissiLetter) December 2, 2025
Potential impact on Bitcoin
As the news spread in the financial world, several prominent crypto figures, including Binance co-founder Chao Changpeng (CZ), weighed in on the impact on the crypto market.
Industry leaders have suggested that the Fed's decisions typically lead to greater market participation, easier access to capital, and stronger upward momentum for Bitcoin. Analysts note that the situation is starting to resemble past cycles in which liquidity expanded before major crypto rally.
An impending rally?
BitMine Chairman Tom Lee told CNBC's Squawk Box that Bitcoin soared nearly 20% in the weeks after the Fed last ended quantitative tightening. He said BTC could rise similarly this time and gain momentum by the new year.
Bull Theory also weighed in on the Fed's latest decision, stressing that the recent move resembles a pattern observed in late 2019, when a series of repo spikes preceded a liquidity squeeze long before the pandemic.
Bull theory suggests that if repos continue to surge, the Fed could move toward some monetary easing by early 2026.
Although this does not reflect the large-scale quantitative easing that began in 2020, it will still provide meaningful liquidity support to financial markets.
Amid expectations for a rally, market analyst Sycoderic called on crypto enthusiasts to remain calm following the Fed's decision. The move is bullish for Bitcoin, but he cautioned against expecting it to skyrocket anytime soon.
Bitcoin likely to drop significantly in mid-December
Amid growing expectations of a potential spike in Bitcoin prices, Into the Cryptoverse founder Benjamin Cowen urged investors to remain cautious.
He warned that while the market expects the Federal Reserve to cut interest rates, the Bank of Japan could raise rates later this month. Cowen noted that a similar setup occurred in July 2024, causing rapid volatility and a significant decline in Bitcoin, with the market bottoming out about a week later.
He warned that a similar situation could come together on December 10th, and that Bitcoin could face similar pressure given the expectation of a Fed rate cut and possible Bank of Japan rate hike. If this pattern repeats, the market could once again experience a short-term capitulation followed by a rebound, forming a potential bottom for Bitcoin in mid-December.
Chart by Benjamin Cowen
BTC price reaction
At the time of writing, Bitcoin is rising following the latest Fed announcement. BTC, which was trading at $84,000 at one point yesterday, is currently up 7.33% over the past day.
Bitcoin Price Chart CoinMarketCap
