Look at some data: The ratio of small-cap altcoins' performance relative to Bitcoin has just hit a new all-time low. What does this mean? Most on-chain analysts interpret this as a bottom signal for small coins.

Why do they think so? The key is that this ratio is particularly sensitive to global liquidity. Historical experience shows that altcoins tend to rebound significantly against Bitcoin only under two conditions—when quantitative easing policies are initiated or when market risk appetite improves. Coincidentally, both conditions could be fulfilled by 2026.

Let's first look at the Federal Reserve. On December 1st last year, the Fed officially ended quantitative tightening. Afterwards, to maintain liquidity in the banking system, it continued bond purchases through open market operations. In just the last few weeks of December, assets surged by $45.5 billion. According to plans, by 2026, the Fed will buy between $35 billion and $55 billion of short-term government bonds each month, with total liquidity injections potentially reaching around $550 billion for the year. This marks a phase of both balance sheet expansion and rate cuts.

There are also policy uncertainties. In mid-May, the current Fed Chair's term ends, and a new chair is expected to be announced this month. Trump's pick is quite clear—someone obedient. Whether it’s Waller, Haskett, or Waller, the result is basically one word: continue rate cuts.

So the logical chain is quite clear—ample liquidity + accommodative policies = a favorable environment for risk assets. But a reminder: not all altcoins can regain value; only those with solid fundamentals can stand out. Manage your positions well, stay flexible in opportunities, and remember that investing is not gambling.