Tom Lee: Stablecoin Flash Crash Triggered Cascading Liquidations, Sending Bitcoin Into a Tailspin After October 10In a CNBC interview on November 21, Bitmine Chairman Tom Lee addressed the key question of "what exactly happened on October 10". He explained that a stablecoin on one exchange suddenly dropped to $0.65 due to an internal pricing issue, triggering the ADL auto-deleveraging mechanism and causing cascading liquidations that forced millions of accounts to close within minutes. Lee noted that the in ...

Market Overview - The market is currently experiencing a liquidity drag, leading to sell-offs in cryptocurrencies and tech stocks to raise cash, coinciding with a stronger dollar and weaker other currencies [2][3] - Elevated volatility is present, with the VIX around 26, indicating that low liquidity makes it easier for prices to move significantly in either direction [3][4] Federal Reserve Insights - Fed member Williams indicated potential for rate cuts this year, suggesting that inflation is trending downwards, which has positively impacted market sentiment [7][8] - The market is now pricing in a 64.4% chance of a rate cut in December, up from 39.1% the previous day, reflecting increased optimism among investors [9] Nvidia Analysis - Nvidia's stock is facing critical support at the $180 level, with potential downside to $170 if this support is broken, which could negatively impact the S&P 500 due to Nvidia's significant market weight [11][12] - Despite strong demand for GPUs, investor concerns about perceived risks in the market, particularly regarding debt levels in companies like Oracle, are affecting sentiment [13][14] Cryptocurrency Market - The cryptocurrency market, particularly companies like Coinbase, is under pressure, with traders selling off positions to manage risk [15][16] - There is a notable decline in funds related to Ethereum, which were previously trading at a premium, indicating a shift in market perception regarding their uniqueness and value [18] S&P 500 Technical Levels - The S&P 500 has significant levels to watch, with a potential downside target of 6,400 and an upside target of 6,675, with a critical support level around 6,550 that needs to hold for a potential bounce [20][22]

BlackRock’s iShares Bitcoin Trust (IBIT) recorded its largest single-day outflow since launch, as investors withdrew $523 million on Tuesday, a sharp signal of deteriorating sentiment in an already fragile crypto market. Key Takeaways: BlackRock’s IBIT saw a record $523 million single-day outflow, signaling weakening confidence across the crypto market. Bitcoin has fallen nearly 30% from its October peak, pushing US spot ETF investors into the red. Tightening liquidity and macro uncertainty are promp ...

New York Fed uh President John Williams met last week with banks uh that underwrite the government's debt about and he met about a key short-term lending facility. Williams asked for feedback on the use of the Fed's standing uh repo facility which allows institutions to borrow cash from the Fed in return for highquality collateral like treasury bonds. Central bank officials view the tool as helpful in keeping short-term borrowing costs within their intended range.The news uh comes amid some concern about st ...

Core Insights - The New York Federal Reserve President John Williams held a meeting with Wall Street dealers to discuss the standing repo facility, a key lending tool for financial institutions [1][2][4] Group 1: Meeting Details - The meeting occurred during the Fed's annual Treasury market conference and included representatives from the 25 primary dealers of banks involved in underwriting government debt [2] - Participants were members of banks' fixed income market teams, indicating a focus on the implications for bond markets [2] Group 2: Purpose of the Standing Repo Facility - Williams sought feedback on the standing repo facility, which allows eligible institutions to borrow cash from the Fed against high-quality collateral like Treasury bonds [3] - This facility acts as a backstop for markets, enabling institutions to sell securities to the Fed with an agreement to repurchase them later [3] Group 3: Context and Concerns - The meeting was prompted by concerns regarding stress in parts of the U.S. financial system and signs of tighter market liquidity [5] - Roberto Perli emphasized that firms should utilize the standing repo facility when it is economically sensible, highlighting its importance in current market conditions [5]

Core Viewpoint - The Federal Reserve Bank of New York encourages firms to utilize the Standing Repo Facility (SRF) as needed, indicating that large-scale usage is acceptable and expected [1][2]. Group 1: SRF Usage and Economic Context - The SRF is designed to be used whenever it is economically sensible, allowing eligible financial firms to convert bonds into cash quickly to address market liquidity needs [2][5]. - Recent trends show rising money market rates and increased usage of the SRF, signaling tightening market liquidity levels [5][6]. - Despite notable usage in late October, it was less than anticipated, with some firms opting to borrow from markets at higher rates instead of utilizing the SRF [6]. Group 2: Market Dynamics and Future Expectations - The Federal Reserve has been reducing its bond holdings since 2022 to manage market liquidity and maintain control over the federal funds rate [4]. - As Wall Street becomes more familiar with the SRF, its usage is expected to increase, particularly if repo pressures persist or intensify, which would help alleviate upward rate pressure [7].

Market Operations - U.S. stock markets, including the New York Stock Exchange and Nasdaq, remain open on Veterans Day, allowing normal trading activities [2][3] - The S&P 500 was down 0.13% and the Nasdaq 100 was down 0.6% at the time of publication, indicating slight market declines [3] Bond Market - The bond market is closed in observance of Veterans Day, as designated by the Securities Industry and Financial Markets Association (SIFMA), affecting transactions involving U.S. Treasury securities, corporate bonds, and municipal bonds [4] Market Volatility - Financial professionals generally observe little market volatility on Veterans Day due to lighter than average investor volume [5] Retail Sector - Major retail chains such as Walmart, Target, and Home Depot remain open and are offering seasonal promotions, with varying store hours [7] Travel Industry - The government shutdown has disrupted air travel, leading to thousands of flight cancellations over the weekend, with more expected on Veterans Day [9]

Core Insights - Bitcoin recently broke below its 200-day moving average, influenced by macroeconomic headwinds, but there is potential for a rebound according to market analyst Tom Lee [1][2] - The recent decline coincided with significant deleveraging in the crypto market, particularly highlighted by the event on October 10th, which was noted as the largest in history [2][3] - Despite the current market challenges, broader financial indicators suggest a positive outlook for Bitcoin and cryptocurrencies, with historical trends indicating a constructive environment following a strong stock market performance [3] Market Dynamics - The U.S. government shutdown and a hawkish Federal Reserve are identified as key factors exerting pressure on risk assets, including cryptocurrencies [2] - The strength of the U.S. dollar is also recognized as a significant macro headwind for the crypto market [2] Sentiment and Predictions - Retail sentiment remains bullish, with prediction markets indicating a 64% chance for Bitcoin to revisit $115,000 before potentially dropping to $85,000, and a 63% chance for Ethereum to reach $4,500 before falling to $2,500 [4] - Recent trading data shows Bitcoin and Ethereum prices at $103,214 and $3,403, reflecting increases of 1.3% and 2.6% over the past 24 hours, respectively [4]

Core Insights - Bitcoin experienced a rally of over 3% after dipping below $100,000 for the first time since June, indicating potential recovery in the crypto market [1] - The recent decline in Bitcoin was attributed to various market pressures, including government shutdowns and a hawkish Federal Reserve, which affected market liquidity and risk appetite [3][4] - The recent deleveraging event in Bitcoin was noted as the largest in history, with ongoing ripple effects still being felt in the market [7][8] Market Dynamics - Bitcoin's break below its 200-day moving average is a significant technical indicator that traders are closely monitoring [2] - Funding stress observed in the secured overnight financing rate may signal early signs of market stress, although it has not yet impacted credit markets or bank equities [5][6] - The correlation between crypto and stock markets, particularly the NASDAQ 100, has been strong, with market makers trading both asset classes [10] Historical Context - Historical data suggests that after six consecutive months of stock market gains, there is an average gain of 3% in the following month, indicating potential for continued upward movement [11] - The current market environment, characterized by stretched valuations, particularly in AI-related stocks, may lead to a broader market expansion as investors seek mean-reverting opportunities [12][13] Investment Sentiment - Institutional investors are increasingly focusing on long-term positioning, with discussions extending beyond 2026, reflecting a strategic approach to current market conditions [13] - Despite concerns over valuations, key AI stocks are still viewed as reasonably valued due to their strong growth rates, suggesting continued interest in this sector [13]

The reason that #Altcoins are falling so heavily is due to limited supply being traded.If your #Altcoin has, hypothetically, 10% of the entire supply being able to trade, then, if markets are going south and any person holding something of the other 90% looks to be selling its position, well, that's going to have a substantial impact on the markets.Let's say 10% is the equal that's on the markets. Then, someone comes in that looks to sell 2% into those books.The books can't absorb that and given the fact th ...