The Federal Reserve's balance sheet has begun to expand after years of contraction, marking a shift in policy from quantitative tightening to re-increasing systemic liquidity. This is the first significant growth in nearly four years, helping to reduce financing frictions and support risk assets such as growth stocks and cryptocurrencies, whose valuations are highly sensitive to liquidity cycles. Bitcoin and the broader cryptocurrency market tend to react first to this shift because their performance is closely linked to the availability of capital, not just interest rate policies.