Sminston With 👁

“Here's the buffer that absorbed four years of quantitative tightening. The reverse repo facility peaked at $2.554 TRILLION on the last day of 2022. Today it holds $255 million. One hundredth of one percent of the peak! 🤯 Money parked overnight at the Fed could drain away without ever touching bank reserves, and all $2.5 trillion of it did exactly that. 📉 Now look at the past year: Fed assets: +$116B Treasury cash account: +$460B Reverse repo: -$56B The Fed added liquidity, and the Treasury took back almost four times as much. There's nothing left to cushion the next one. 💡Now think of the last disappointing 'dampened' Bitcoin 'bull run': The 2023–2025 (pseudo) bull run was a cycle run on flat liquidity. Not contracting; the buffer prevented that. But not expanding either. Compare that to 2020–2021, where net liquidity went vertical and so did Bitcoin. It's making more sense now. A pseudo-bull run unsupported by macro, by Fed policy, by sentiment - only running of the ETF launches and possible halving narrative. But Bitcoin will have another proper bull run, yet.”