According to Omkar Godbole, pre-COVID U.S. debt levels were not above 100% of GDP, highlighting how post-2020 leverage shifted macro liquidity dynamics that traders must monitor (source: Omkar Godbole on X, Dec 11, 2025; Congressional Budget Office FY2019 data). U.S. debt held by the public stood near 79% of GDP at the end of FY2019, below 100%, underscoring the step-change higher after 2020 (source: Congressional Budget Office, Historical Debt Data). In September 2019, the Federal Reserve began large-scale repo operations and later added Treasury bill purchases to stabilize funding markets while maintaining it was not QE (source: Federal Reserve Bank of New York statement on repo operations, Sept 2019; Federal Reserve Board announcement on T-bill purchases, Oct 11, 2019). On March 12, 2020, the New York Fed offered up to $1.5 trillion in term repos to ease acute funding stress, followed by an open-ended QE program announced on March 23, 2020, materially expanding reserves and system liquidity (source: Federal Reserve Bank of New York repo operations announcement, Mar 12, 2020; Federal Reserve Board QE statement, Mar 23, 2020). For crypto traders, elevated federal borrowing and potential funding strains can widen rate term premia and tighten USD liquidity, conditions that often coincide with higher cross-asset volatility, making liquidity dashboards essential for BTC and ETH risk management (source: U.S. Treasury Borrowing Advisory Committee minutes; Bank for International Settlements Quarterly Review on term premia). Key watchpoints include the Fed balance sheet and reserve levels from H.4.1, SOFR and repo rates, and Treasury General Account swings that add or drain bank reserves (source: Federal Reserve H.4.1 statistical release; Federal Reserve Bank of New York SOFR data; U.S. Treasury Daily Statement on the TGA). For flow confirmation within crypto, monitor net stablecoin issuance and transfer volumes as a proxy for on-chain dollar liquidity alongside macro funding indicators (source: Coin Metrics network data; Federal Reserve H.4.1; U.S. Treasury reporting).

According to @BullTheoryio, markets have priced a 95% probability of a 25 bps rate cut, so the real volatility driver will be liquidity signals from Powell’s tone and the Fed’s view on the economy, funding conditions, and inflation (source: @BullTheoryio). According to @BullTheoryio, SOFR has been spiking, indicating bank funding stress and raising expectations for some liquidity relief from the Fed (source: @BullTheoryio). According to @BullTheoryio, any hint of QE or short-term liquidity support would likely be immediately bullish by easing funding pressure, pushing bond yields lower, and boosting risk assets including crypto (source: @BullTheoryio). According to @BullTheoryio, a hawkish cut (inflation not fully controlled, labor improving) risks higher yields and a risk-asset sell-off, while a dovish cut (minimal tariff impact, weak labor) should lower yields and lift crypto (source: @BullTheoryio). According to @BullTheoryio, the roadmap is: dovish plus liquidity support equals strong bullish impulse; dovish only equals a small pump; hawkish cut risks a sell-off similar to October; no liquidity help implies sideways action, with BTC’s last hawkish-FOMC reaction serving as a cautionary guide (source: @BullTheoryio).

According to Edward Dowd, impromptu talks are occurring amid worries about strains in money markets, highlighted via a FinancialJuice update he shared on X, signaling potential stress in financial plumbing. source: Edward Dowd on X; FinancialJuice on X Money-market strain points to tightening liquidity and elevated funding stress that can affect risk-asset volatility and crypto market depth. source: Bank for International Settlements; Federal Reserve Traders should monitor SOFR versus the policy rate, GC repo levels, and intraday repo spikes for signs of secured funding pressure. source: Federal Reserve; Federal Reserve Bank of New York; DTCC Track ON RRP usage and U.S. Treasury bill auction outcomes (tails and coverage) to gauge cash scarcity or abundance that can spill over to crypto liquidity. source: Federal Reserve; U.S. Department of the Treasury Watch cross-currency basis and dealer balance-sheet capacity as proxies for dollar funding tightness that can constrain leverage and basis trades. source: Bank for International Settlements; Federal Reserve Bank of New York Major stablecoin issuers disclose significant U.S. T-bill holdings, linking crypto market plumbing to money-market dynamics during stress episodes. source: Tether issuer attestations; Circle issuer disclosures For crypto positioning, monitor BTC and ETH perpetual funding rates and CME futures basis to detect de-leveraging or stress transmission. source: CME Group; major crypto derivatives exchange disclosures

According to @AltcoinDaily, the U.S. Secured Overnight Financing Rate (SOFR) is dropping sharply, indicating cheaper overnight funding for major borrowers and a risk-on liquidity impulse that can lift asset prices (source: @AltcoinDaily). According to @AltcoinDaily, a move like this in SOFR has historically preceded directional moves in Bitcoin (BTC) and altcoins within weeks rather than months, framing a near-term trading window focused on liquidity signals over narratives (source: @AltcoinDaily). According to @AltcoinDaily, traders should prioritize liquidity metrics as the key driver over hype when positioning for potential BTC and altcoin volatility following a SOFR-led easing in funding conditions (source: @AltcoinDaily).

According to @business, the U.S. government shutdown is worsening stress in dollar funding markets, adding to a funding market mess that traders must monitor closely for liquidity risk transmission to risk assets, including crypto. source: Bloomberg/@business Funding strains typically manifest as wider T-bill–OIS spreads, volatile SOFR and general collateral repo rates, and dislocations at Treasury bill auctions that lift front-end yields and tighten collateral conditions. sources: Federal Reserve, Financial Stability Report (Oct 2023); BIS Quarterly Review (Mar 2020) When funding markets tighten, broader financial conditions usually deteriorate and high-beta assets have historically underperformed, with BTC and ETH showing increased correlation to risk-off moves as institutional participation has risen. sources: Federal Reserve, Financial Stability Report (Oct 2023); BIS Bulletin No. 45 (2022) Actionable watchlist for traders today: 1–3 month T-bill vs OIS spread, SOFR and GC repo prints, bill auction bid-to-cover and award tails, USD cross-currency basis, and BTC/ETH perpetual funding rates and futures basis as real-time liquidity gauges. sources: U.S. Treasury, Quarterly Refunding documents (2023); Federal Reserve, SOFR releases; CME Group, Bitcoin and Ether futures market education (2023)