For those of you calculating how many times the Federal Reserve might cut interest rates next year, it might be worth looking at the issue from a different angle. While the market discusses two cuts, one cut, or even bets on zero cuts, it’s unaware that the entire game has already changed. The key is no longer "rate cut frequency," but a more sobering reality — liquidity is gradually drying up.

Here are a few numbers you need to remember: The Fed has already cut interest rates by a total of 175 basis points in this cycle. A strategy analysis team from a major investment institution recently issued a judgment that the room for rate cuts is nearly exhausted. Going further down would approach neutral interest rate levels, at which point the Fed would really have little room left.

To put it vividly, the Fed’s previous "liquidity easing" could be done generously, pouring into the market freely. Now, only a trickle remains. Whether it can continue to benefit crypto assets is anyone’s guess. Don’t expect the kind of flood-like market conditions we saw in the past.

What is the biggest cognitive trap here? Many people still treat "number of rate cuts" as a remote control for crypto market rises and falls. Little do they realize, the real test in 2026 will be the pressure on liquidity. Look at the US initial jobless claims data, which has already returned to November 2021 levels. The labor market shows no signs of the expected recession, meaning the Fed has no real reason to implement large-scale easing.

CME Federal Funds futures are also speaking: the probability of a rate cut in January is only 15.5%, and even if there is a cumulative 25 basis point cut by March, the probability remains less than half. How many people's "rate cut fantasies" does this shatter?

In short, rather than relying on the expectation of policy easing, it’s better to adapt early to the new environment of liquidity contraction. Traders who understand this are already adjusting their positions, while those still waiting for "easing dividends" should prepare for a longer wait.