Overnight, the rules of the game for global liquidity changed.

On December 1, the Federal Reserve did something major—it directly injected $13.5 billion through overnight repo operations. What does this number mean? It’s the second highest single-day liquidity injection since the pandemic, only surpassed by the $29.4 billion emergency liquidity boost at the end of October.

The truth is: the central bank has already reached the liquidity red line it set for itself.

The even more crucial turning point comes next—QT (quantitative tightening) has come to a complete halt. The balance sheet reduction plan that started in mid-2021 and lasted for three and a half years is now officially on pause. Treasury securities maturing? They’re all being rolled over and reinvested, none are allowed to disappear. MBS maturing? Same thing, not a single cent is being withdrawn.

What does this mean? In plain language:
Banks bring $13.5 billion in Treasuries to the Fed, the central bank takes them all, and immediately injects an equivalent amount of fresh reserves into the system. Even though the money has to be repaid the next day, the signal is crystal clear—don’t expect the Fed to keep draining the market anymore.

The question now isn’t “Is QT really over?” but rather a much more exciting speculation:
Has a new cycle of liquidity expansion already quietly begun?

There have been two $10 billion-plus repo operations within two months, clearly showing the banking system is parched. If the Fed really plans to open the floodgates again, the story ahead could get very interesting—after all, the last time this happened, Bitcoin soared from just over $3,000 to $69,000.