After a hiatus of more than four years, the Federal Reserve has quietly resumed its liquidity injections. In 2025, $128 billion has already been reintroduced into the banking system via “overnight repos.” A strong signal that could reignite interest in Bitcoin.
The Federal Reserve’s quiet return to quantitative easing
In 2025, the Fed clearly began its monetary pivot: the benchmark rate fell from 5.5% in July to 4% in October. Markets now anticipate another 25-basis-point cut at the December 10 meeting, with a probability estimated at over 80% according to the CME.
The economic slowdown reinforces this conviction among investors. However, the Consumer Price Index (CPI) remains stable at 3%, a level still above the 2% target, which could justify maintaining a cautious and still restrictive monetary stance.
Although it had ended its monetary injection operations in June 2020, the U.S. Federal Reserve (Fed) quietly opened the liquidity floodgates in 2025.
Since the beginning of the year, $128 billion has been injected into the banking system via “overnight repo” operations, a level not seen since the emergency responses to the pandemic in 2020.
Overnight Repurchase Agreements over the past 12 months
The most recent example: $13.5 billion was added on December 1, one of the largest operations since the COVID crisis.
A few days earlier, $11.25 billion had been injected on November 28, and $29.4 billion on October 31.
Overnight Repurchase Agreements (or overnight repos) are very short-term loans through which the Federal Reserve temporarily injects liquidity into the financial system.
In practice, it purchases Treasury securities from a bank or institution, with the agreement that these will be resold to it the next day at a slightly higher price. These operations are primarily aimed at stabilizing short-term interest rates, particularly when demand for liquidity rises sharply.
By injecting this liquidity, the Fed prevents interbank rates from rising too much, which could lead to a credit crunch and market stress. In other words, repos are not directly intended to lower long-term bond rates (as Quantitative Easing would), but to prevent a sharp rise in short-term rates.
This mechanism is crucial for maintaining market liquidity, especially during periods of monetary instability or restrictive policy.
Can the bull run resume for Bitcoin?
This influx of tens of billions in liquidity could well act as a catalyst for risky assets, particularly Bitcoin, which is currently trading below the $100,000 mark.
Expectations of another Fed rate cut have, in fact, propelled the price of BTC from $86,000 to $93,000 in the space of 24 hours, a rise of nearly 8%.
Historically, BTC has always responded well to periods of accommodative monetary policy, driven by its digital scarcity and the influx of capital seeking returns.
As markets already anticipate a rate cut as early as December, this quiet resumption of money creation could reignite interest in Bitcoin as an alternative store of value.
