To be honest, I was once again taught a lesson by the market this time.

Seeing a well-known investor directly bet $33.08 million on ETH expecting a rate cut, I thought at the time that this was a safe play — the Federal Reserve really cut rates! But what happened? 100,000 traders got liquidated in 24 hours, losing over 200 million dollars, and that $33.08 million is still floating underwater.

But what truly enlightened me wasn’t the numbers, it was finally understanding a principle:

In the crypto world, it’s never about playing “events,” it’s about playing “expectations.”

How do retail investors think? Rate cut is coming → This is good news → Buy!
How do institutions play? Rate cut expectations emerge → Preemptively accumulate → Actual rate cut → Sell and exit.

This is the legendary “buy the rumor, sell the fact.”

Looking back, at the end of October when BTC was around $110,000, the market started speculating about a “rate cut in December.” When the expectation of a December cut was disappointed, BTC dropped directly from $110,000 to around $80,000.

By the early morning of December 11th, the Fed actually cut rates, retail investors thought the opportunity had come, buying at $95,000. But 24 hours later, BTC fell to $89,000, another wave of liquidation.

Retail investors always buy “after the fact,” taking the supply from institutions, and that’s where the gap lies.

What’s even more deadly is that Powell also set a trap this time: there might only be one rate cut in 2026. The market initially expected 2-3 cuts, but now expectations are shattered, so the market continues to fall.

Retail investors hear the words “rate cut,” while institutions are looking at “probably no cuts next year”…