Crypto’s Slide May Not Be Fear — It’s A US Liquidity Crunch, CEO Says
A sharp sell-off in crypto markets wiped out approximately $250 billion in value over the weekend, with Bitcoin falling below $80,000—down 40% from its 2025 high. Analysts note weakening retail interest, large ETF outflows, and a loss of momentum. Support around $73,000–$75,000 is now critical.
According to Raoul Pal, CEO of Global Macro Investor, the decline is not crypto-specific but stems from a broader U.S. dollar liquidity crunch. Factors include Treasury General Account rebuilds, higher funding costs, and a reduced Reverse Repo Facility buffer. Pal stated that gold’s rally absorbed marginal liquidity that might have flowed into risk assets like Bitcoin and SaaS stocks, leaving the most exposed positions vulnerable.
The nomination of Kevin Warsh as Fed Chair added uncertainty, with some fearing slower rate cuts. While markets remain fragile, some expect liquidity conditions to improve, potentially allowing a recovery if dollar flow normalizes.
bitcoinist02/02 15:51
