Netizen Premium | Bitcoin Deep Dive #29

Can U.S. Policy Save Bitcoin's Bull Market?

Let The Fed Cuts Continue

While markets are currently pricing in a standard 25 basis point rate cut on Wednesday 9/17, the probability of a more aggressive 50 basis point move has increased following last week's weak employment data. The US labor market is cooling at just the right pace to justify Fed rate cuts without signaling economic collapse, and August's disappointing jobs report has given Powell ammunition for larger cuts if needed. The risk is that hot inflation data over the next two weeks could force them be more hawkish, but the broader trend toward monetary easing is now firmly established. This policy shift comes at a crucial time as Bitcoin's momentum has appeared to stall, but we believe Fed easing will provide the liquidity injection needed to re-accelerate the bull market.

TLDR: Fed easing cycles compress real yields and weaken the dollar - both historically powerful Bitcoin catalysts.

The Everything Rally Remains Primed

The Trump administration’s fiscal agenda involves trillions in tax cuts and spending programs while inflation remains persistently above the Fed's 2% target. This creates a policy tailwind for risk assets where fiscal expansion meets monetary accommodation…especially with a likely dovish Fed Chair replacement coming in 2026. The combination virtually guarantees significant currency debasement over the medium term as the government borrows heavily while the Fed keeps rates artificially low. We're remain convicted in our Everything Rally thesis, where hard assets outperform cash as investors flee currency depreciation, providing the fundamental backdrop Bitcoin needs to break out of its recent consolidation.

TLDR: Massive fiscal spending plus accommodative Fed policy creates the perfect storm for Bitcoin to break out of its current consolidation.

Goldilocks Remains The Dominant Regime

Our top-down analysis indicates the market regime remains firmly in GOLIDLOCKS territory, which historically favors risk-on positioning in both equities and Bitcoin. Momentum indicators show equity, bond, and currency volatility trending BEARISH while equities, gold, and Bitcoin all exhibit strong BULLISH momentum characteristics. We believe these dynamics represent the early innings of a secular US dollar bear market, where non-dollar assets systematically outperform as global investors diversify away from dollar-denominated holdings. This combination of falling volatility and continued dollar weakness creates an ideal environment for sustained rallies in alternative assets, exactly what Bitcoin needs to resume its upward trajectory.

TLDR: Current momentum indicators remain bullish for Bitcoin, and the improving macro backdrop should sustain this trend.

For an update on Bitcoin’s on-chain metrics supporting our dynamic dollar-cost averaging model, please see below: