The cryptocurrency market has recently experienced a sudden and dramatic fluctuation. While the market was still hovering around $3888, Ethereum suddenly initiated a rapid rise. The direct trigger for this surge was a new policy change: US pension plans (401k) are now allowed to invest in cryptocurrency.

The announcement immediately caused a strong reaction in the market. Ethereum's daily increase exceeded 5%, with its price breaking through the $3900 mark. Bitcoin performed even more impressively, climbing close to the high of $116,000. The entire cryptocurrency market instantly boiled over, with investor sentiment soaring.

The impact of this policy should not be underestimated. The size of the U.S. 401k pension pool reaches $8.7 trillion, which is nearly half of China's annual GDP. Even if only 1% of this massive fund flows into the cryptocurrency market, it will bring an additional $87 billion, enough to significantly affect the prices of mainstream cryptocurrencies like Ethereum.

At the same time, the relaxation of law enforcement restrictions on encryption trading platforms has further eliminated the psychological barriers for institutional investors entering the market, injecting more confidence into the market.

However, the excitement in the market has not stopped there. Media reports suggest that the Federal Reserve may undergo leadership changes, which could lead to a shift in monetary policy from the current tightening to easing. If this expectation comes true, it could recreate the market scene from the massive liquidity injection period of the Federal Reserve in 2020, during which Ethereum experienced an astonishing increase of about 600%.

Despite the generally optimistic outlook in the market, investors still need to be cautious. The cryptocurrency market has always been highly volatile, and changes in policy and market sentiment can have significant impacts. When making investment decisions, one should fully consider the risks and closely monitor market trends and policy directions.