Xiao Hei: A new bull market for Bitcoin has started, and the US Treasury Department will continue to be cautious!!!. Arthur Hayes wrote a long article titled 'Same Same Same But Different' last night, but the core is actually one thing: Beisen is following the path taken by Yellen in 2023- when US bond yields are too high for the US fiscal system to handle, there is no need for the Federal Reserve to publicly cut interest rates QE， The Ministry of Finance will start to find ways to inject liquidity into the market on its own. 2023 is the best example. At that time, the Federal Reserve's interest rate was still above 5%, while continuing to shrink its balance sheet, but Bitcoin and the Nasdaq still began a big bull market. The explanation given by Xiao Hei is: Yellen issued a large amount of short-term bonds, driving money from the monetary fund out of the Fed's RRP, which eventually dropped from about $2.5 trillion to nearly $100 billion. Money returned from the Fed's account to the tradable financial system, and risky assets began to take off. Now Besent is facing the same problem: The US debt has exceeded 40 trillion US dollars, and the long-term US debt yield is reaching the top of the danger zone again. On August 19th, the US Treasury Department suddenly increased the single repurchase size of 10-30 year US Treasury bonds from $2 billion to at least $4 billion, causing a brief decline in yields, and Bitcoin subsequently rebounded. But soon the US Treasury bonds began to be sold again, with the 10-year term returning to around 4.7%. The market is actually telling Besent that this amount of money is not enough. So what we really need to focus on next is whether the US Treasury market will continue to force Besent to increase its investment. Xiao Hei gave three scripts: The most aggressive approach is to turn 5% into the actual upper limit of the yield, beyond which long-term bonds can be repurchased indefinitely; A more realistic approach is to continue gradually expanding Treasury Buyback while increasing the issuance of short-term bonds; There is also something that has been put on the table - directly using the TGA account of the Ministry of Finance, which is close to $1 trillion, to repurchase long bonds. Besent has confirmed that TGA currently has approximately $940 billion, and the Ministry of Finance is studying using it to fund buybacks. This is the most valuable aspect of this article for Crypto. The United States now has an increasingly difficult cycle: The more debt there is, the higher the long-term interest rate, the greater the interest expenses, the greater the need to borrow money, and the market demands higher yields. If the Ministry of Finance does not want this cycle to get out of control, it can only constantly find ways to lower long-term interest rates. Every action to save the US dollar debt may increase the liquidity of the US dollar at the margin, and Bitcoin happens to be one of the most sensitive assets to US dollar liquidity in the world. So Xiaohei called BTC the smoke alarm of global liquidity, and I think this is more worth remembering than interest rate cuts that benefit Bitcoin. If the scene that follows is: 10-year US Treasury bonds continue to surge towards 5% → Besant continues to expand buybacks → TGA begins to decline → the proportion of short-term bonds continues to increase, then don't wait for the Federal Reserve to officially announce QE before realizing that liquidity has turned. Xiao Hei has announced his heavy holdings in BTC, ETH, ENA, and ETHFI. What he is betting on is not that a certain currency suddenly has fundamentals, but that the United States has to refill the entire financial system in order to save its $40 trillion debt market. The original link can be found in the comment section: