Just when I started watching the market, I was completely stunned—Bitcoin fell over a thousand points in less than an hour, directly breaking through the key level that had the long positions gritting their teeth to hold; meanwhile, the US stock market crashed right at the open, with Nasdaq showing a drop of over 2%, and the tech zone was in a state of mourning. The community instantly fell into chaos, with messages like "close all positions and rug pull" and "this time it's really going to be bad" flooding the screen, and many frens were staring at their account balance, their fingers trembling.

But take a moment to calm down for three seconds—this round of double killing in the coin and stock market is definitely not some black swan event, nor is it a signal for the arrival of a bear market. Understanding the two core logics behind it, you will know how to respond.

**Liquidity has been forcibly drained**

The U.S. Treasury's recent move is quite aggressive: due to the warning lights on the fiscal account balance, not only has it suspended the supply of funds to the market, but it has also quickly sold off $163 billion in government bonds. What does this mean? It's like forcibly withdrawing funds that were originally flowing in the crypto and stock markets to fill the debt hole. High-risk assets are supported by ample liquidity for their valuations, and now that the funding faucet has been turned off, the pressure to sell emerges, leading to a ruthless drop. It is not surprising that Bitcoin, as a typical risk asset, was the first to be hit hard.

**Interest rate cut expectations have been doused with cold water**

Previously, the market generally bet that the Federal Reserve would cut interest rates in December, and many short-term funds entered the market early to position themselves. As a result, Fed official Goolsbee suddenly made a harsh statement in the early morning: "Inflation data hasn't been brought down yet, don't expect interest rate cuts." This statement directly triggered panic—those leveraged funds betting on rate cuts were suddenly thrown into chaos, hastily closing positions to escape, creating a typical "long positions killing long positions" stampede effect. The U.S. stock market and the cryptocurrency market were instantly dragged down by this emotional torrent.

**But this is just a short-term liquidity crisis, not a fundamental collapse**

It must be made clear: this wave of big dump is essentially an emotional outburst triggered by temporary liquidity tightening, and has nothing to do with the fundamentals of the market. Just like a person who is temporarily tight on cash does not mean that he has a problem with his earning ability. Once the U.S. government fills the fiscal gap and the Federal Reserve eases its stance to release signals for easing, the funds that have been withdrawn will eventually flow back. By then, as severe as the fall has been, the rebound could be just as fierce. Now is actually a window period for selecting quality assets.

**Three survival rules for you**

**Don't panic sell.** Right now, panic selling is equivalent to cutting losses at the floor price. When the funds flow back and the market reverses, you'll only be able to watch others profit.

**Lock in core targets.** Bitcoin, mainstream cryptocurrencies that have been unfairly punished, and quality tech stocks are currently in an undervalued range; these are the assets worth keeping an eye on.

**Keep cash on hand.** Opportunities always arise from a fall; with bullets in hand, wait for the rebound signal to get in at the right time; without money, you can only be anxious.

Did you hold up this round?