The Federal Reserve's December meeting minutes just released have exposed a fierce internal disagreement. Although the Fed has completed its third rate cut this year, policymakers are divided on the future path, resulting in a rare "face-off" in recent years. On one side is a continued vigilance against sticky inflation, while on the other is a deep concern that the labor market could deteriorate rapidly. This tug-of-war puts policymakers in a dilemma: cutting rates too aggressively could trigger a rebound in inflation, but being too cautious might lead to an economic recession. The three dissenting votes in the last meeting have already brought these disagreements to the surface.

Interestingly, the market seems to be less convinced by the Fed's official narrative. The Fed's own dot plot indicates that there might only be one rate cut by 2026, but actual traders are voting with their actions. According to CME's federal funds futures tools, market bets on at least 25 basis points of cuts before March 2026 have exceeded 50%. Even more aggressively, about 6.5% of bets are placed on a direct 50 basis point cut. The market is more optimistic and eager than Fed officials.

But this isn't the biggest suspense. Even more impactful than the rate path is the upcoming leadership transition. President Trump has announced plans to nominate a new Fed Chair next month. Currently, two leading candidates have completely opposite styles: one is former Fed Governor Kevin Warsh, a hawk advocating for policy independence and deep reforms; the other is former White House economic advisor Kevin Hasset, a typical dove favoring fiscal stimulus and looser interest rate policies. Whoever ultimately takes the chair could disrupt the entire monetary policy rhythm for 2025 and even 2026, which could have a significant impact on global markets.

For cryptocurrencies, these uncertainties all point to a core issue: how will the "switch" in global liquidity be turned? Historical experience shows that liquidity expectations are often the underlying engine driving crypto markets. If rate cuts exceed expectations or the new chair leans toward easing policies, assets like Bitcoin and Ethereum could receive strong macro narrative support, opening up enormous upside potential.