U.S. Currency Swap Layout and Its Multi-Dimensional Impact on the Crypto Market

Recently, U.S. Treasury Secretary Yellen has been vigorously promoting a global currency swap agreement, which appears to be a targeted liquidity injection for allies lacking dollars, but in reality, it is patching the loosened petrodollar hegemony and building the core framework of a "Financial NATO."

This not only stirs up the global financial landscape but also directly determines the future trend of the crypto market. The Middle East geopolitical conflicts have driven up oil prices, and the blockage of the Strait of Hormuz has caused global oil import and export countries to face dollar shortages. The U.S. did not follow the traditional approach of raising interest rates to boost the dollar; instead, it used currency swaps to selectively provide dollars to allies.

It is likely aimed at stabilizing the petrodollar settlement system, countering challenges to dollar dominance from other currencies; secondly, to prevent allies from selling U.S. Treasuries to exchange for dollars, thus stabilizing their own Treasuries; thirdly, to deeply bind other countries' financial systems with the dollar and create an exclusive dollar financial alliance. Essentially, it is still an attempt to maintain its own dollar system through territorial control.

Returning to the crypto market, the macro-level impact sets the tone. This move significantly increases the U.S. control over inflation and the stability of U.S. debt, and the Federal Reserve’s previously expected rate cuts and liquidity easing are likely to be postponed across the board. The core driver of the recent bullish crypto trend has been global liquidity easing and hot money flooding in. With rate cut expectations delayed, the influx of new funds will diminish, and the main theme of the crypto market will be large-scale wide-range fluctuations. Don’t expect a short-term bullish or bearish runaway trend. I believe many have experienced this in recent market movements; I have never seen such a oscillation channel withstand multiple validations over more than 20 days.

Looking at specific short-term and long-term impacts, the divergence is very clear. In the short term, this operation directly boosts the rigid demand for global dollars. Under geopolitical turmoil, safe-haven funds always prefer the dollar. The safe-haven attributes of Bitcoin and Ethereum will be continuously suppressed, likely oscillating with gold to form a bottom, and the previously hyped "Bitcoin as a safe haven" logic will basically be invalid in the short term.

Meanwhile, the U.S. precisely controls dollar liquidity, making market leverage more cautious. Extreme surges or crashes will become less frequent, and frustrating range-bound oscillations will become the norm. But in the long run, this situation actually plants the seeds for long-term growth in the crypto market. The U.S. creating a "Financial NATO" effectively draws a camp in the global financial circle. Countries and funds excluded from the dollar system will rely more on cryptocurrencies for cross-border settlement and asset hedging. This will further reinforce Bitcoin’s core logic as a "non-sovereign hedge asset," but this positive effect is long-term and will not be quickly reflected in short-term market movements.