logo

Analysis: The U.S. Treasury is set to withdraw $500-600 billion in cash from the market over the next two months, potentially leading to increased market illiquidity.

By: theblockbeats.news|2025/08/20 07:02:33

BlockBeats News, August 20th. Delphi Digital Market Research Institute published an article stating that in the coming weeks, the US Treasury Department will begin replenishing its General Account (TGA), a process that will withdraw $500–600 billion in cash from the market over approximately two months. At first glance, this may seem ordinary, but the current period is evolving into one of the most fragile liquidity environments of the past decade.


In 2023, the $550 billion TGA replenishment was cushioned by over $2 trillion of Fed reverse repo tools, healthy bank reserves, and robust overseas bond demand. Now, these cushions are no longer in place. The Fed is still consuming liquidity through Quantitative Tightening (QT), reverse repos are nearly exhausted, banks are constrained by losses and capital rules, and overseas buyers from China to Japan have also exited. The result is that every dollar raised by the Treasury Department this fall will be directly extracted from active market liquidity.


High-beta tokens tend to amplify downward movements during liquidity tightening. If stablecoin supply contracts during the TGA replenishment period, ETH and other high-risk assets may experience larger declines compared to BTC unless there is structural inflow of funds from ETFs or corporate treasuries. In a low-liquidity environment, position management and capital rotation across risk curves are more critical than ever.


If stablecoin expansion coincides with TGA rising, the crypto market may be more resilient to absorb the impact compared to previous cycles; if stablecoins contract, liquidity extraction will transmit faster and more intensely.

Bitcoin’s Remarkable Journey in 2025: Price Surges and Market Insights as of August 20, 2025
Analyst: Bitcoin Support Located in $109,600 to $106,800 High Demand Zone

You may also like

Share
copy

Gainers

Latest Crypto News

16:15

Tether CEO Responds to FUD: Tether Q3 Group Equity Close to $30 Billion, with U.S. Treasury Bonds Generating Approximately $500 Million in Monthly Net Income

16:15

Ethereum's Net Supply in the Last 30 Days Has Increased by 77,380 ETH

15:15

Rayls will have its TGE on December 1st

15:15

Ethereum developers are preparing for the Fusaka upgrade on December 3rd.

14:45

Hasset: Would Be Honored to Serve as Federal Reserve Chair if Nominated by Trump

Read more
Community
icon
icon
icon
icon
icon
icon
icon

Customer Support@weikecs

Business Cooperation@weikecs

Quant Trading & MMbd@weex.com

VIP Servicessupport@weex.com