Asia Morning Briefing: BTC Traders Brace for Fed Cuts but Massive $4.5B Liquidity Tests Loom

Market Overview - The Federal Reserve's easing cycle is expected to begin, with both Polymarket and CME FedWatch indicating a 25 basis points cut for the next FOMC meeting, and a potential three-cut path through year-end [1][2] - Market sentiment reflects a strong belief in the Fed's pivot, with Bitcoin (BTC) trading at $116,762, up 1.3% for the day and 4.7% for the week, while Ethereum (ETH) is at $4,502, up 4.3% for the week [2] Trading Activity - Bitcoin exchange inflows have decreased to a 7-day average of 25,000 BTC, the lowest in over a year and a half, indicating that large holders are not selling [3] - Ethereum exchange inflows have also dropped to a two-month low of 783,000 ETH, down from 1.8 million in August, suggesting reduced selling activity from large holders [4] Stablecoin Dynamics - USDT deposits into exchanges surged to $379 million at the end of August, the highest this year, and remain elevated at $200 million, indicating strong liquidity support for a potential post-Fed rally [5] Altcoin Activity - Altcoins are experiencing increased exchange activity, with transaction deposits climbing to a 7-day total of 55,000, up from a previous range of 20,000–30,000 earlier this year, suggesting profit-taking in higher-beta assets [6] Market Outlook - The upcoming token unlocks totaling $4.5 billion in September could pressure liquidity and test market absorption, as noted by OKX Singapore CEO Gracie Lin [6] - Lin emphasizes that stablecoins are nearing a supply of $300 billion, and significant infrastructure upgrades, such as Nasdaq's move toward tokenized securities, indicate that crypto is becoming integrated into the global financial system [7]