As global investors prepare for Christmas, a key personnel appointment that will determine liquidity over the next three years is keeping Wall Street and the crypto market on edge.
The Federal Reserve has narrowed down its final four nominees for its first round of interviews. President Trump has explicitly stated that his nominees must support “significant interest rate cuts.” This power transition coincides with the U.S.’s push through the GENIUS Act to establish a decentralized USD stablecoin system directly backed by U.S. Treasury bonds.
This clash between traditional monetary power and blockchain finance will redefine the flow of global capital. Your Bitcoin, US stocks, and entire crypto asset portfolio are standing at the forefront of this paradigm shift.
01 The Final Interview: Four Candidates and the Promise of "Significant Interest Rate Cuts"
The handover of the Federal Reserve chairmanship is in its final countdown, with the shortlist narrowing down to the last four candidates.
Trump's core demand is very straightforward: the next chairman must push for "significant interest rate cuts" to reduce government debt costs and stimulate the economy. This explicit demand has given dovish candidates an overwhelming advantage.
02 Three scenarios: What fate awaits your position?
Different candidates mean drastically different monetary policies and market scenarios.
Scenario 1: The doves win (Hassett or Waller) – a “floodgate-opening” bull market.
Market expectations for prolonged easing will be quickly priced in. Bitcoin and the Nasdaq will be the most direct beneficiaries, potentially triggering a new round of price increases driven by liquidity. The core strategy: buy risk assets on dips.
Scenario Two: Hawkish Surprise (Wash) – “Austerity Panic” Shock
The market may face a sharp sell-off in the short term, with the US dollar strengthening. The core strategy is to significantly reduce holdings of high-risk assets, increase cash holdings, and wait for opportunities after the panic subsides.
Scenario 3: Dark Horse or Delay – The "Wait and See" Conundrum
The market will likely experience a period of volatile trading lacking a clear direction, with funds rotating rapidly. The core strategy is to reduce positions, adopt a swing trading approach, and avoid chasing highs and selling lows.
03 Profound Changes: How Does Decentralized USD Bind to Traditional Finance?
This change of leadership is so crucial because it will accelerate a process: the on-chaining and politicization of dollar liquidity.
The GENIUS Act marked the beginning of the US government's systematic extension of dollar hegemony into the blockchain. Its core was to encourage the issuance of dollar-backed stablecoins fully backed by US Treasury bonds. These decentralized USD have become significant buyers of US Treasury bonds, creating a new transmission path: Federal Reserve policy → US Treasury yields → stablecoin issuance costs → crypto market liquidity.
If the new chairman implements politically motivated easing, it may stimulate the market in the short term, but in the long term it will raise concerns about the credibility of the US dollar and the value of decentralized USD collateral. This contradiction will bring unprecedented complex volatility.
04 Christmas Week Survival Guide: Key Moments and Defense Strategies
During the illiquid Christmas week, you must be aware of the following key time points:
This week's key focus: Closely monitor Trump's social media and White House statements; official personnel announcements could happen at any time.
Risk window: Wednesday and Thursday, market liquidity will drop to rock bottom, and small transactions could trigger significant volatility.
Defense strategies for ordinary investors:
Reduce leverage: Before the decision becomes clear, reduce the leverage ratio of your positions to the lowest possible level.
Keep cash on hand: Maintain at least 30%-50% in cash or stablecoins to cope with volatility.
Stay away from the market during the holiday period to avoid impulsive decisions based on short-term noise.
05 Building "Antifragile" Cross-Cycle Portfolios
Faced with a paradigm shift, the wisest strategy is to build "antifragile" compositions that can adapt to multiple environments:
The primary focus of the offensive (40%): Retaining core crypto assets such as Bitcoin and Ethereum to capitalize on the "global monetary easing dividend."
Stable Cornerstone (40%): Allocated to a variety of stablecoins, including Decentralized USD, and cash-like assets.
Hedging the tail end (20%): Allocate a small amount to gold or volatility products to hedge against extreme policy risks.
The field before the referee blows the whistle to make substitutions is always the most chaotic and full of opportunities.
Trump's "Christmas decision" will shape the pricing logic of global assets for years to come. As traditional interest rate policies become deeply intertwined with on-chain Decentralized USD, market volatility will become a redistribution of wealth.
History shows that after major policy turning points, the market always rewards those investors who are well-prepared, emotionally stable, and have a healthy asset structure. Your task is not to predict which button Trump will ultimately press, but to ensure that no matter which one he presses, your portfolio remains intact and you capture the opportunities that belong to you.
