The market is counting down to the Fed rate cut on the 10th, but have you noticed a strange phenomenon? Everyone is betting on easing, yet long-term US Treasury yields remain stubbornly high and won’t come down. What’s behind this?

Simply put, when expectations are fully priced in, it’s often the starting point for a script reversal. The moment the rate cut finally happens, it might not be the beginning of a celebration, but rather a signal for profit-taking and exits.

In the short term, the S&P 6900 level is crucial. If it breaks through, everyone’s happy. But if it can't, watch out for a collective withdrawal of funds—at that point, even holding 6700 could be in question. Also, after the rate cut, capital flows may shift—funds might quietly move from the overhyped tech giants to small-cap and value stocks. Don’t wait until the rotation is over to react.

However, the real long-term story isn’t about the rate cut itself, but how stablecoins are quietly rewriting the rules of the game.

The data speaks for itself: the scale of tokenized US Treasuries has soared to $74 billion, growing even faster than traditional stablecoins. Traditional financial giants like BlackRock and Fidelity have already entered the space. More importantly, the recently passed GENIUS Act in the US has essentially handed compliant stablecoins a “protection card”—clarifying that stablecoins are not securities and must be backed 1:1 by high-quality assets, mainly US Treasuries. This is essentially a new way for dollar hegemony to play out in the digital era.

Stablecoin issuers have now become new buyers of US Treasuries, creating an entirely new source of demand. But the Bank for International Settlements has also warned: if there’s a massive run, it could trigger a flash crash in the US Treasury market. So when choosing stablecoins, you must look at reserve transparency and compliance—USDC is relatively reliable; stay away from those operating in a black box.

To sum up: in the short term, it’s all about the rate cut expectations game, but beware of “all good news being priced in turns into bad news.” Long term, the real new narrative is how stablecoins are binding US Treasuries and the crypto world together. This is more than just a sector opportunity—it’s a new weapon for the US dollar in the digital age.

What’s your strategy? Short-term hedging or long-term RWA positioning? Feel free to share your thoughts. (Disclaimer: Not investment advice. Please do your own research.)