Bitcoin News Today: Investors Flock to Risk Assets as Fed Easing Unleashes $7.4T Liquidity Surge

According to Investors Business Daily, the U.S. Federal Reserve is set to cut interest rates by 25 basis points for a second consecutive meeting on Wednesday, lowering the fed funds rate to 3.75–4.00%. The decision, driven by weaker-than-expected inflation data and persistent labor market weakness, is part of a broader easing cycle aimed at supporting economic growth amid ongoing government shutdowns and trade uncertainties. The Fed is also expected to announce the end of quantitative tightening, halting the monthly reduction of its balance sheet by up to $5 billion in Treasuries and $35 billion in mortgage securities, the outlet adds.

A MarketScreener preview notes that the rate cut comes as global markets closely monitor U.S.–China trade negotiations ahead of a Trump–Xi meeting at the APEC forum in South Korea. Investors are hoping for a resolution to escalate tariffs on Chinese goods, which have exacerbated inflationary pressures and disrupted supply chains. The outcome could influence the Fed's December rate path, with markets fully pricing in another reduction by year-end, the preview adds.

A CoinPaprika analysis suggests the Fed's easing cycle could trigger a $7.4 trillion liquidity surge into risk assets, including stocks and Bitcoin, as money market funds—holding $7.39 trillion—seek higher returns amid declining yields. Analysts project that 10% of these funds, or $739 billion, may flow into equities and bonds, with Bitcoin ETFs attracting $3.5 billion in weekly inflows this month. BlackRock's IBIT alone holds $100 billion in assets, signaling growing institutional adoption of crypto as a hedge against inflation, the analysis reports.

According to Lookonchain, the launch of Bitwise's Solana Staking ETF (BSOL) has added momentum to crypto markets. The first U.S. ETP to hold 100% spot SOL, BSOL offers a 7% average staking yield and 0% fees for a limited time. The fund, which began trading on October 28, has attracted $400 million in assets under management, with inflows surging amid regulatory clarity on staking activities following recent SEC guidance.

An Asiae article reports that China's People's Bank of China signaled an accommodative monetary policy, resuming government bond purchases to stabilize yields and the yuan. This follows a yuan decline and historically low bond yields earlier this year. Meanwhile, Taiwan's Taiex index surged 1.68% on optimism over U.S.–China trade talks and Fed easing, though TSMC profit-taking tempered gains, the article says.

Yahoo Finance data show global crypto funds added $921 million in inflows last week, driven by Fed rate cut optimism. Bitcoin reclaimed $115,000 as investors viewed it as a long-term store of value, while Ethereum saw outflows as capital rotated into Bitcoin. Solana and XRP ETFs also gained traction, with traders anticipating new U.S. crypto products, the report notes.

The Fed's dovish stance and global policy shifts are reshaping risk appetite, with equities, crypto, and emerging markets poised to benefit. However, uncertainties around tariffs, supply chain disruptions, and geopolitical tensions remain key risks. Investors will closely watch the Fed's December decision and the Trump–Xi meeting for further clues on the path ahead.