Family, who understands this! Last night, I opened the market software and directly experienced a pupil earthquake. The mainstream cryptocurrencies plummeted with a big bearish candle that broke through the 65000 key level, and the community instantly erupted: "Did the market maker run away?" "Is there a black swan that hasn't been exposed?" "Should we cut losses and run?"
As an old hand who has been watching the crypto market for 8 years, I want to make my core viewpoint clear: This drop has nothing to do with conspiracy theories; it’s purely two "funding siphons" coming together to cause trouble, just a short-term liquidity squeeze!
First, let me reveal the two main culprits behind this, all hardcore insights, once you understand it, you won't panic:
The first siphon: the U.S. Treasury's 'emergency debt-selling lifeline'. Those in the know are aware that the U.S. government's TGA account (simply put, the 'national treasury') was nearing depletion recently. To avoid a funding chain break, they directly overnight sold 163 billion U.S. dollars in government bonds. What does this operation mean? It’s like forcing institutions and investors in the market to cough up real cash to take over, with over 170 billion U.S. dollars locked into government bonds overnight and unable to move.
To know, cryptocurrency itself is a 'representative player' of high-risk assets. The hot money in the market is like water in a pool, and now suddenly more than half of it has been drawn away, causing the funding pool to directly 'run dry'. Can the coin price not fall? It's like suddenly taking away oxygen from a person who is running; a drop is a purely normal reaction.
The second siphon: the 'hawkish cold water' from Federal Reserve officials. In the early morning, Federal Reserve official Goolsbee suddenly 'released a hawk', stating bluntly that 'inflation hasn’t been suppressed to target, and don’t even think about rate cuts in December'. This statement directly splashed a bucket of cold water on the market. Previously, everyone had bet on loosening by the end of the year, and the CME interest rate futures showed the probability of rate cuts dropped from 70% to 45%.
Those betting on interest rate cuts panicked in an instant, closing positions and leaving the market, triggering a direct 'mutual slaughter': you want to sell, I’m even more eager to sell; under mutual stepping, the coin price plummeted like a roller coaster. This wave is purely a dual squeeze of emotion and liquidity.
Here’s the key! Why do I say there's no need to panic? This wave of 'funding winter' won’t last for weeks; it will soon welcome the 'spring liquidity':
After the U.S. government shutdown crisis is resolved, the TGA account will replenish funds, and the previously locked 170 billion U.S. dollars will slowly flow back to the market. At that time, risk assets will once again receive funding; the Federal Reserve will likely slow down RRP operations next week (simply put, it’s a tool for withdrawing excess dollars from the market), and short-term dollar supply will become loose, directly easing the funding pressure in the cryptocurrency market.
Here’s a core secret I want to share about observing the market (purely practical): Instead of staring at the red and green of candlesticks every day to guess rises and falls, it’s better to focus on two liquidity indicators—the TGA account balance and the RRP scale. These two data points are the 'barometer of funds' in the cryptocurrency market, more reliable than any technical analysis. This drop is a typical case of 'indicators warning in advance, coin prices falling later'; understanding it early leads to calmness.
The cryptocurrency market has always been 'liquidity determines short-term fluctuations, value determines long-term trends'. This drop is just an adjustment caused by short-term funding siphoning, not a trend reversal.
Want to avoid the next 'money siphon' activation in advance? Want to precisely get on board before liquidity loosens? Follow Mr. Ke! Mark key points like TGA, RRP, and Federal Reserve speeches in advance to help you avoid pitfalls and seize opportunities, so you don’t have to be led around by candlestick patterns!
