Quantitative easing is an unconventional monetary policy that central banks resort to when their traditional tools reach the limits of sustainability, and not necessarily when they lose their effectiveness immediately. Under normal circumstances, the economy is managed through interest rates, but when high interest itself becomes a burden on growth, debt servicing, and financial stability, the system enters a phase of gradual choking. At this stage, lowering interest rates may not be politically or psychologically feasible yet, but continuing tightening becomes economically unsustainable. Here, quantitative easing begins to emerge as a forthcoming path rather than an announced decision, as expectations are managed first before budgets, as historically occurred with institutions like the Federal Reserve.
The real reason for resorting to quantitative easing is not only related to lowering interest rates to zero but to the accumulation of pressures resulting from the tightening itself. Rising financing costs, declining credit activity, pressure from government debt servicing, and slowing growth are all factors that make strict monetary policy unsustainable for long periods. Therefore, central banks begin to hint rather than announce and psychologically prepare the markets before any actual shift, as a return to easing represents an implicit acknowledgment that the system cannot withstand long-term monetary discipline. In this context, quantitative easing becomes a tool for buying time, not for a radical solution.
The mechanism of quantitative easing remains fundamentally unchanged. The central bank creates new liquidity and uses it to purchase bonds, which raises their prices and lowers their yields, driving capital out of debt instruments towards higher-risk assets. This liquidity does not transfer directly to the real economy but first passes through financial markets, showing its effects in asset prices before any actual improvement in production or income. Therefore, the first effect of easing is not inflation in goods but inflation in assets, with consumer inflation appearing later after a time gap.
This monetary framework is the basis for understanding the liquidity cycle in cryptocurrency markets. Historically, crypto markets only enter a phase of accelerated growth when two concurrent conditions are met: Bitcoin breaking its previous cycle price peak and stabilizing above it, and a shift in global monetary policy from tightening to an actual or expected easing path. This pattern has clearly repeated in the 2017 and 2020–2021 cycles, where altcoins did not experience real rises before Bitcoin stabilized at new peaks.
When Bitcoin surpasses pivotal historical levels, such as the $100,000 area, the behavior of institutional capital changes. At this stage, liquidity no longer concentrates only in Bitcoin as a rare asset but begins to shift towards networks capable of absorbing larger flows and providing practical uses. This is where the phase of capital redistribution within the crypto market begins.
Ethereum represents the first station in this transition. In the previous cycle, its sharp rise only began after Bitcoin stabilized above its peaks, rising from low levels to nearly five thousand dollars during the quantitative easing period. Today, Ethereum's situation has matured, with a decreasing issuance rate, a fee-burning mechanism that reduces supply, and expanding institutional adoption through layer two networks. Therefore, it is currently viewed as a financial settlement layer more than just an experimental tech platform.
After Ethereum becomes saturated with liquidity, funds move towards networks characterized by speed and low cost, where speculation plays a larger role. Historically, Solana has been one of the major beneficiaries at this stage. The return of network activity and developers during 2023 and 2024 preceded the price rise, which is a pattern that usually repeats before major liquidity waves. In an easing environment, markets reward not just financial depth but also efficiency and speed, making Solana a candidate to attract high-risk capital.
As for BNB, it represents a different bet in the upward cycle. Its value is directly related to the volume of trading activity, not to technical narratives. In the 2020–2021 cycle, it rose sharply with increased trading volumes and the use of platform services. When Bitcoin surpasses record levels, volumes, collateral, and yields automatically rise, making BNB a reflection of overall market activity.
The essential point that most investors overlook is the chronological order of liquidity flow. Major currencies do not lead the market before Bitcoin; they follow it in a historical sequence that can be tracked. Superior performance does not result from choosing the 'best project' but from entering at the moment liquidity begins to actually transfer from one asset to another.
In summary, the highest returns in previous cycles were not achieved at the beginning of the rise but after Bitcoin stabilized at a new peak in an easing monetary environment. Therefore, the fundamental question for the serious investor is not 'which currency should I buy?' but: Has the liquidity cycle really started, or is the market still in a preparatory phase?
