Bitcoin Price Dip: US Dollar Liquidity Concerns?
Bitcoin and altcoins experienced significant volatility this week following a market crash fueled by fears of a Trump-era trade war. While Bitcoin briefly reclaimed the $100,000 mark, the rally proved short-lived, suggesting underlying market weakness. Former BitMEX CEO Arthur Hayes highlighted dwindling US dollar liquidity as a potential cause for concern.
Bitcoin and Altcoin Correction: What's Next?
Bitcoin’s price has fallen another 2% in the past 24 hours, trading near $97,500, with daily trading volume down 20% to $64.3 billion. Altcoins are also experiencing significant selling pressure, with Ethereum (ETH) nearing its support level of $2,700 and XRP plummeting 8% following XRP Ledger network downtime.
US Dollar Liquidity: A Key Factor
Arthur Hayes emphasizes the importance of macroeconomic factors in shaping the crypto market's trajectory. Echoing renowned macroeconomist Felix Zulauf, Hayes points to troubling signs in US dollar liquidity, citing:
- A shrinking US fiscal deficit negatively impacting dollar liquidity.
- A rising Treasury General Account (TGA), despite hitting the debt ceiling weeks ago, further straining dollar liquidity.
- US banks reducing dollar loans to foreign entities, exacerbating the liquidity crunch.
Hayes suggests that this dwindling US dollar liquidity is not conducive to a sustained crypto market rally. Last week, he predicted a potential Bitcoin price drop to $70,000, anticipating a “mini financial crisis” before a substantial rally to $250,000.
Bitcoin's Price Trend: Consolidation or Breakout?
Crypto analyst Ali Martinez notes Bitcoin’s current price consolidation between $90,900 and $108,500. A decisive break above or below this range is crucial to determine the next trend. Until then, the market outlook remains uncertain.

Macroeconomic Indicators to Watch
This week’s US jobs report will be critical in determining future monetary policy decisions. The labor market remains robust, with inflationary pressure persisting. This led the US Federal Reserve to maintain interest rates unchanged during last week’s FOMC meeting.
The USD/JPY pair opened the week cautiously, retracting some of Friday’s gains due to mixed US Treasury yields and rising Japanese 10-year government bond (JGB) yields. Peter Schiff commented, “The yield on the 10-year Japanese government bond is now up to 1.28%. The rise in JGB yields is a big story that few are paying attention to. The coming greater financial crisis may well begin in Japan, but the impact will be even greater in the U.S.”
While Bitcoin is consolidating, some altcoins are showing signs of strength. Investors remain cautious, awaiting a clear directional signal.
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Disclaimer: This analysis reflects the author's opinion and is subject to market conditions. Conduct thorough research before investing in cryptocurrencies. The author and Codeum assume no liability for any financial losses.