Crypto could benefit if Fed steps in to backstop US stock market: Analysts
Analysts say a major US stock-market downturn could push the Federal Reserve to use extraordinary support, including buying equity ETFs or expanding balance-sheet liquidity, because the $75 trillion equity market is now too large and politically important to ignore. The idea is that if the Fed backstops stocks, risk appetite would recover and liquidity would flow into high-beta assets like crypto. Bitcoin and major crypto assets are seen as especially sensitive to dollar liquidity, real rates, and equity sentiment, so they could benefit from easier policy even without direct central bank support. The argument is reinforced by precedents such as the Fed’s 2020 corporate bond ETF purchases and by the high share of Americans who own stocks, which increases pressure to prevent a prolonged bear market.
