Fed Executes Massive $13.5B Liquidity Injection; Crypto Reprices Higher on ‘Silent’ Liquidity Pump

By Coin Edition
29 days ago
PUMP BANK WD RSRV HIGHER
  • The Pump: The NY Fed conducted a $13.5 billion overnight repo operation, the second-largest liquidity injection since 2020.
  • The Response: Bitcoin and Solana surged as the market sniffed out the stealth easing, adding $205 billion to the total crypto market cap.
  • The Skew: Despite the liquidity-fueled rally, options traders remain defensive, hedging against a potential sub-$80k correction in Q1.

The crypto market’s $205 billion surge Wednesday was the direct downstream effect of a massive, under-the-radar liquidity injection by the Federal Reserve. While headlines focused on the formal end of Quantitative Tightening (QT), the Federal Reserve Bank of New York was actively flooding the banking system with cash via the repo market to stave off a collateral shortage.

Data confirms the Fed conducted a $13.5 billion overnight repurchase agreement (repo) operation on Dece…

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