Cryptocurrency Allocation Amid the Federal Reserve's Money Printing Boom: Rotation Opportunities from Bitcoin to Privacy Coins

【BlockBeats】On January 6th, a well-known crypto investor pointed out in a recent analysis that the geopolitical actions taken by the US government to control the global oil supply will ultimately trigger a large-scale liquidity expansion—stimulating the economy through deficit spending and credit easing, and driving down oil prices. The biggest beneficiaries of this strategy? Bitcoin and mainstream cryptocurrencies.

The logic is quite clear. The Trump administration, aiming to win the midterm elections in 2026 and the 2028 presidential race, needs to boost nominal GDP, soothe unemployment rates, and stabilize public opinion on gasoline prices. Increasing oil supply to lower oil prices is just the first step; true economic stimulation depends on the Federal Reserve’s cooperation—massive deficit spending and balance sheet expansion to release liquidity. In other words, the money-printing machine will be running at full throttle.

As excess US dollars flood into various assets, Bitcoin, as a “hard asset” against fiat currency devaluation, takes the lead. Furthermore, there are subtle differences in this liquidity cycle. Some investors have seized this opportunity, even beginning strategic positioning in Q3 2025, believing that privacy coins will become high-yield tracks in this cycle. Their teams are searching for potential coins that can lead the privacy track and outperform the market in the coming years.

The current holding strategy also reflects this judgment: reducing US dollar stablecoin reserves, and entering 2026 with significantly decreased risk exposure. Cash generated from financing transactions continues to be allocated to Bitcoin, but the focus is on selling some Bitcoin to finance privacy coin positions, and selling Ethereum to finance DeFi positions. Under the large liquidity expansion cycle, carefully selected altcoins are expected to outperform BTC and ETH relatively. This is not gambling, but a structural allocation based on macro liquidity expectations.