The recent bearish belt hold of BTC directly slammed the price down to around 65000, and many people are asking: who is really behind this?

It's actually not a sudden negative event, but rather two things came together.

The first thing - draining blood from US Treasuries. The TGA account of the US Treasury is about to run out, so they quickly auctioned off 163 billion dollars in government bonds to make ends meet. This is no small amount; the market has to take over more than 170 billion dollars. With all the money going to buy government bonds, the crypto market naturally suffers. For risk assets like BTC, when liquidity tightens, the drop is the most severe.

The second thing is that the expectation of interest rate cuts has cooled. Federal Reserve official Goolsbee suddenly spoke out at midnight: "Inflation is still so high, don't think about interest rate cuts in December." Once this was said, those who were betting on rate cuts at the end of the year were immediately panicked. The market's expectation for a rate cut in December dropped directly from 70% to 45%, short-term funds frantically stopped losses and fled, and the bulls trampled each other. It's surprising that BTC could hold steady.

But there's no need to panic too much. This wave of liquidity withdrawal is a short-term behavior. Once the government shutdown crisis passes and the TGA account is replenished, the funds will slowly flow back. Moreover, if the Federal Reserve lowers the size of reverse repurchase agreements (RRP) next week, the supply of USD will also loosen. This kind of "liquidity tightening" usually doesn't last more than a few weeks before easing.

In other words, rather than jumping up and down on the K-line, understanding the flow of funds is the real business. The market has never lacked volatility; what it lacks is the insight to see through the essence.