Federal Reserve Policy Trap Sparks Bitcoin Crash Warning

A warning of an impending Bitcoin crash is spreading rapidly on X, based on a comparison between the S&P 500 chart and the Benner cycle. The post warns that something 'extremely bad' could happen on Monday.

The analysis suggests that the Federal Reserve has reached a policy trap, where raising interest rates could lead to higher borrowing costs and long-term Treasury yields while weakening economic growth and increasing debt-servicing pressure.

Alternatively, holding rates steady or cutting them could worsen inflation, loosen financial conditions, and eventually force another round of tightening. This creates the cycle highlighted by the post, where higher rates could mean slower growth, while lower rates could mean renewed inflation pressure.