Fed Conducts Record $74.6B Liquidity Operation via SRF

• Lyla Velez
• January 1, 2026
• Policy
• 0 Comments

Operation Overview

The event highlights the Federal Reserve’s use of SRF as a routine measure to manage short-term liquidity, indirectly affecting Bitcoin’s value amidst seasonal financial dynamics.

The U.S. Federal Reserve recent $74.6 billion liquidity operation via its Standing Repo Facility (SRF) is aimed at addressing year-end liquidity demands. The operation involved $31.5 billion in U.S. Treasuries and $43.1 billion in mortgage-backed securities, occurring on December 31, 2025. The New York Fed managed the SRF, ensuring temporary liquidity against high-quality collateral with the intent to stabilize private repo markets. No official statements from Fed leaders or crypto influencers were reported.

The immediate effect of this liquidity operation included a surge in Bitcoin prices to $89,000, attributed to reduced selling pressure amid typical holiday liquidity constraints. Broader cryptocurrency recovery contexts were noted, though no specific impacts on Ethereum or other altcoins were detailed. Michael Terpin, Early Bitcoin Investor, remarked on potential future trends, “Forecasting BTC at $60,000 floor in Q4 2026.” This primarily affects short-term funding and cryptocurrency market sentiment, with implied temporary stability.

Historical patterns demonstrate frequent year-end SRF usage since 2021, routinely returning to normal within days. This indicates an anticipated minimal long-term stress in both traditional funding and crypto markets. Insights on future implications suggest potential trends in Bitcoin price reactions, with cautious monitoring on potential changes in such regulatory procedures.