Recently, Meme coins ArbDoge AI (AIDOGE) and PEPE (PEPE) detonated the money-making effect, and in conjunction with the gap between Bitcoin and Ethereum, announced that the market has entered an adjustment. On the one hand, retail investors are fighting to the death in the airdrops of these top projects, and on the other hand, there are wild dogs dancing wildly, and the pent-up funds are venting the effect of making money. There are two days of fire and ice, and the market has no main line.
As the market fell, people began to look for clues on the macro, and the US Treasury account balance (TGA) balance that was about to bottom came into view.
Arthur Hayes, the founder of BitMex, stated in an article announcing his increase in Bitcoin on February 7 that he would liquidate this round of Bitcoin positions when the U.S. Treasury account balance (TGA) bottomed out. Some people joked that Arthur Hayes finally got it right, so what’s the reason?
“Fluidity” Narrative Principle
The latest data shows that the US Treasury account balance (TGA) is less than 100 billion US dollars, and the US tax data in April is lower than expected. Arthur Hayes believes that if the current fiscal is not enough to support the repayment of US debt interest, the market expects the US to fall this year. The U.S. debt limit of 31.4 trillion U.S. dollars will be raised again in half a year, and the re-issuance of U.S. debt will drain the dollar liquidity in the market, so it will not be conducive to risky assets, so it is negative for Bitcoin.
In addition, it can also be considered that Waller, the director of the US Federal Reserve, and Mester, the chairman of the Cleveland Fed, who were previously hawkish, will also speak in these two days, and the decline is a hedge against the news day.
When “liquidity” promotes the biggest narrative in the encryption market
In the U.S. March economic data, PPI fell, but core CPI rose more than expected. Why?
The positive PPI data, that is, the decline in industrial purchase prices, shows that the international supply chain problems caused by the epidemic have been resolved, while the core CPI’s exceeding expectations are closely related to the relocation of the US manufacturing industry brought about by decoupling. The root cause of the high position. In the context of the inevitable decoupling, interest rate hikes and rate cuts are no longer just about the rise and fall of the technology industry, but part of a larger situation.
Investors in the cryptocurrency market have a common saying, mining the next narrative.
But when Silicon Valley Bank’s thunderstorm opened up the small rise of Bitcoin, when the LSD track fell into the homogenization of involution, when all the Layer 2 could not even get out of half the space in a wave of small market, superimposed on the cooling of blue-chip NFT, it was The market’s weakness to the “crypto narrative” should be seen.
Perhaps it is the path dependence in 2022, or it may be grasping the life-saving straw in the spiritually deficient market. It has to be admitted that “water release and interest rate hike” has become the most important narrative that dominates the current cryptocurrency market. When the real analysis becomes a narrative, the evolution of the market has been divorced from the facts. If you blindly study where the inflection point of raising interest rates and releasing water is, it will inevitably become the fuel of the narrative.
After all, before the release of water, the market for release of water has a reason to exist.
