Recently, many friends have been asking the same questions: The Federal Reserve has started to loosen monetary policy again. Can I still buy the dip now? Should I hold BTC or ETH? Will I get caught in a trap? I understand the anxiety behind these questions, but today I want to analyze the underlying logic of this market movement from a different perspective.

This market trend differs fundamentally from previous cycles — it’s not an ordinary bull market driven by retail investors, but the result of institutional influx reshaping the market structure. Two questions are worth deep understanding: How significant is the impact of the Federal Reserve’s liquidity injection on crypto assets? Why are institutions suddenly locking large amounts of BTC and ETH?

When we talk about the Federal Reserve’s liquidity easing, it essentially means injecting a large amount of liquidity into the financial system. These funds naturally seek high-elasticity, high-yield assets, and cryptocurrencies perfectly match this demand. The 2020 market rally already validated this logic, and this time it’s being replicated. But the key change lies in what follows — institutional locking of positions has altered the distribution of market chips.

Previously, chips were dispersed among retail investors, and market rallies were like a “全民狂欢” (nationwide celebration). Now, a large portion of chips is concentrated in institutions, turning market pushes into precise control — in a highly controlled scenario, funds can crush and squeeze out short positions.

Looking at some actual data makes it clear how terrifying the control depth of institutions is. On the BTC side, Grayscale Trust’s holdings have already surpassed 650,000 BTC, with less than 1% unlocked in nearly half a year, effectively “freezing” these 650,000 BTC in long-term holdings. Regarding ETH, Ark Fund has increased its holdings of ETH-related assets by 47% over the past year, with no large-scale reduction operations. Plus, after the Merge, 22 million ETH validators are locked, accounting for 18% of the circulating supply — a quite significant proportion.

Understanding these data points helps us realize that the current market is far from being as simple as “buy when optimistic, sell when pessimistic.” Institutional control over chips determines the market rhythm. If retail investors still operate with traditional thinking, the risks are indeed substantial.