Bitcoin is expected to enter a bull run again, with the Federal Reserve's interest rate cuts and the strengthening of the yen as key factors.

I recently finished a two-week skiing holiday, most of which was spent on backcountry skiing trips. This activity requires a lot of energy, with a total daily energy expenditure of over 4000 kilocalories. To maintain my condition, I regularly consume quick-energy sugars while also eating some "real food" that burns slowly.

This dietary approach can be likened to prices and quantities in monetary policy. The price of money is like the sugar that provides quick energy, while the quantity of money is like the "real food" that burns steadily. At the Jackson Hole meeting last Friday, The Federal Reserve (FED), the Bank of England, and the European Central Bank all indicated that they would lower policy interest rates.

After Powell announced a policy shift, risk assets broadly rose. However, the yen also began to strengthen, which could trigger yen arbitrage trade unwinding, thereby offsetting the benefits brought by the interest rate cut.

I believe that central banks such as The Federal Reserve (FED) realize that they must ease policies and expand their balance sheets to offset the adverse effects of the yen's appreciation. From an economic perspective, the FED should have raised interest rates instead of cutting them. However, as a highly financialized economy, the United States needs asset prices to continue rising.

I expect that if the yen appreciates rapidly and leads to a market decline, the Federal Reserve will take more easing measures, including halting the balance sheet reduction and restoring quantitative easing. At the same time, the Treasury may also inject liquidity by issuing government bonds.

For cryptocurrency holders, the favorable factors currently include: global central banks lowering interest rates, the Treasury injecting liquidity, and the Bank of Japan cautiously raising interest rates. Although the stock market outlook is unclear, for assets with limited supply like Bitcoin, large-scale money printing will drive up their prices.