Dec 10, 2025
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Trump Fed Takeover May Influence Crypto Market and Gold Performance
The potential for a "Trump Fed takeover" in 2026 is emerging as a significant macroeconomic theme. Analysts suggest that markets may be underestimating the radical impact this could have on global liquidity, with implications for crypto markets.
- Macro commentator plur daddy emphasizes how the Trump Fed takeover is being undervalued and considers it a pivotal theme for 2026.
- Former Fed trader Joseph Wang warns that markets underestimate the likelihood of a Trump-led Fed prioritizing lower interest rates, potentially leading to a surge in equity markets.
The Trump Fed Takeover Isn’t Priced In
- A bond market pushback is observed through term premium dynamics, particularly the spread between the 12-month T-bill and the 10-year Treasury.
- Strategies to compress term premium without formal quantitative easing include deregulating banks, adjusting Treasury issuance, and leveraging GSEs for mortgage-backed securities.
- The current complex market environment affects directional risk bets like crypto, but expectations are for improved conditions in the new year with fiscal accommodation and increased T-bill repurchasing.
Will The Crypto Market Rise Again?
- Plur expects a more favorable macro backdrop in 2026 compared to late 2025, predicting strong performances in gold, equities, and select commodities due to the Fed dynamics.
- For cryptocurrencies like Bitcoin, the outlook remains cautious, with potential benefits from improved liquidity but concerns over supply/demand imbalances.
- The crypto market could indirectly benefit from increased reserves and lower term premiums, but sustained demand is crucial to overcoming supply constraints.
As of now, the total crypto market cap is estimated at $3.05 trillion.
