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Bitcoin’s Liquidity Lifeline Just Got Cut—What You Need To Know

  • The Federal Reserve's liquidity support for risk assets, including Bitcoin, is ending as the government plans to issue new debt to replenish the Treasury General Account.
  • The recent $5 trillion debt ceiling increase will lead to a significant withdrawal of liquidity from the system, potentially impacting Bitcoin and other risk assets.
  • The strengthening US dollar resulting from the debt issuance could create a bearish environment for Bitcoin, as historically Bitcoin performs poorly in such conditions.
  • Tomas warns of potential funding stress by the end of September as Treasury issues new short-term debt to refill the Treasury General Account, impacting Bitcoin's performance.

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