# Crypto Rally Predicted as US Treasury Liquidity Drain Nears End ▴ News

**Published:** 2025-09-21
**Categories:** News

---

The refilling of the U.S. Treasury General Account functions as a significant, temporary absorption mechanism for market liquidity. This process sequesters capital from private markets, creating a structural headwind for risk assets. The completion of this fiscal operation, coinciding with the Federal Reserve’s initiation of a new rate-cutting cycle, presents a powerful dual catalyst.

The primary systemic effect is the potential for a synchronized release of both fiscal and monetary liquidity. Such an environment historically correlates with an increased appetite for duration and risk, which directly impacts the valuation models and capital flows for the entire digital asset ecosystem.

The conclusion of the Treasury’s liquidity absorption phase is positioned to serve as a primary catalyst for renewed capital flows into crypto markets.

- 
**Treasury General Account Target** ▴ $850 Billion

- 
**Key Proponent** ▴ Arthur Hayes

- 
**Concurrent Catalyst** ▴ Federal Reserve initiates 25 BPS rate cut

Signal Acquired from ▴ <a href="https://cointelegraph.com/news/crypto-ready-for-up-only-mode-once-us-tga-hits-850b-target-arthur-hayes?utm_source=options.greeks.live&utm_medium=referral&utm_campaign=satellite" target="_blank" rel="nofollow">cointelegraph.com</a>

**Tags:** [Liquidity Drain](https://options.greeks.live/area/liquidity-drain/), [Systemic Liquidity](https://options.greeks.live/area/systemic-liquidity/), [Fiscal Dynamics](https://options.greeks.live/area/fiscal-dynamics/), [Asset Price Inflation](https://options.greeks.live/area/asset-price-inflation/), [Market Inflection](https://options.greeks.live/area/market-inflection/), [Rate-Cutting Cycle](https://options.greeks.live/area/rate-cutting-cycle/)	

## Discover More

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### [How Does Procyclicality in CCP Margin Models Amplify Financial Crises?](https://options.greeks.live/question/how-does-procyclicality-in-ccp-margin-models-amplify-financial-crises/)
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Procyclical margin models amplify crises by creating a feedback loop where volatility-driven margin calls force asset sales, fueling more volatility.

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### [BitMine First to Hold One Million ETH Valued over Five Billion](https://options.greeks.live/news/bitmine-first-to-hold-one-million-eth-valued-over-five-billion/)
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This event signifies a new echelon of institutional Ether accumulation, establishing a critical benchmark for systemic liquidity and strategic asset allocation within the digital asset ecosystem.

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### [What Are the Primary Contagion Channels between Interconnected Central Counterparties?](https://options.greeks.live/question/what-are-the-primary-contagion-channels-between-interconnected-central-counterparties/)
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Interconnected CCP contagion arises from shared clearing members and liquidity pressures, transforming localized risk mitigation into systemic vulnerability.

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### [US Treasury Secretary’s Bitcoin Reserve Stance Impacts Market Valuation](https://options.greeks.live/news/us-treasury-secretarys-bitcoin-reserve-stance-impacts-market-valuation/)
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The US Treasury's policy on Bitcoin reserve acquisition directly impacts market liquidity, necessitating strategic recalibration for institutional portfolios.

- 
### [How Does a Ccp’s Margin Model Contribute to Systemic Liquidity Risk?](https://options.greeks.live/question/how-does-a-ccps-margin-model-contribute-to-systemic-liquidity-risk/)
![Sleek, dark grey mechanism, pivoted centrally, embodies an RFQ protocol engine for institutional digital asset derivatives. Diagonally intersecting planes of dark, beige, teal symbolize diverse liquidity pools and complex market microstructure. This highlights high-fidelity execution, price discovery, and atomic settlement via Prime RFQ for block trades.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-engine-powering-high-fidelity-execution-for-multi-leg-spreads-portfolio-margin-and-atomic-settlement-via-prime-os-for-block-trades.jpg)

A CCP's margin model contributes to systemic liquidity risk by procyclically demanding collateral during market stress, amplifying liquidity shortages.

- 
### [How Does Quote Firmness Impact Transaction Cost Analysis Models?](https://options.greeks.live/question/how-does-quote-firmness-impact-transaction-cost-analysis-models/)
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Quote firmness fundamentally reshapes TCA models by quantifying the true availability of liquidity, driving more precise cost attribution and execution optimization.

- 
### [Treasury Liquidity Shift Signals Imminent Crypto Market Rally](https://options.greeks.live/news/treasury-liquidity-shift-signals-imminent-crypto-market-rally/)
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Systemic liquidity dynamics approach an inflection point, priming digital asset markets for a significant capital influx and repricing event.

- 
### [How Can a Risk System Differentiate between Normal Volatility and a Systemic Liquidity Crisis?](https://options.greeks.live/question/how-can-a-risk-system-differentiate-between-normal-volatility-and-a-systemic-liquidity-crisis/)
![Two high-gloss, white cylindrical execution channels with dark, circular apertures and secure bolted flanges, representing robust institutional-grade infrastructure for digital asset derivatives. These conduits facilitate precise RFQ protocols, ensuring optimal liquidity aggregation and high-fidelity execution within a proprietary Prime RFQ environment.](https://options.greeks.live/wp-content/uploads/2025/08/institutional-grade-execution-channels-enabling-private-quotation-and-optimal-liquidity-aggregation-for-high-fidelity-digital-asset-derivatives-rfq-protocols-on-prime-os.jpg)

A risk system differentiates volatility from a liquidity crisis by monitoring funding markets and contagion channels, not just asset prices.

- 
### [US Treasury Liquidity Shift Signals Crypto Market Rally](https://options.greeks.live/news/us-treasury-liquidity-shift-signals-crypto-market-rally/)
![Abstract intersecting geometric forms, deep blue and light beige, represent advanced RFQ protocols for institutional digital asset derivatives. These forms signify multi-leg execution strategies, principal liquidity aggregation, and high-fidelity algorithmic pricing against a textured global market sphere, reflecting robust market microstructure and intelligence layer.](https://options.greeks.live/wp-content/uploads/2025/07/institutional-digital-asset-derivatives-rfq-protocol-multi-leg-execution-algorithmic-pricing-global-liquidity-principal-trading-systemic-integration-high-fidelity-execution.jpg)

Systemic liquidity recalibration is poised to unlock substantial capital flows, creating a structural advantage for digital asset markets.

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---

**Original URL:** https://options.greeks.live/news/crypto-rally-predicted-as-us-treasury-liquidity-drain-nears-end/
