Fed-Cut Expectations Fuel Crypto Rally, Risks Remain

Cryptocurrency markets rallied this week after weaker-than-expected U.S. private payrolls and a government shutdown prompted traders to price in a near-certain Federal Reserve rate cut, pushing Bitcoin higher and attracting strong spot-ETF inflows and rising derivatives open interest. The rally proved fragile: a midweek plunge that erased about $1.5 billion was linked to stress at fast-growing digital-asset treasury (DAT) companies that amplify moves by issuing equity to buy crypto and can reverse sharply when sentiment shifts. Observers warned of structural limits to some institutional strategies, highlighted recurring bubbles and past failures such as FTX, and pointed to faster algorithmic trading and instant sensitivity to geopolitical events as drivers of short-term unpredictability. At the same time, investors seeking gains continue to use launchpads, on-chain data platforms, and Telegram communities to find new token launches, tools that can surface early opportunities but require careful vetting to avoid scams. In short, dovish macro forces and fresh capital are fueling upside, but leverage, novel investment vehicles, regulatory gaps and geopolitical shocks leave the rally vulnerable to swift reversals.