In the past week, as the conflict between the United States and Iran suddenly escalated and the Strait of Hormuz was blocked, crude oil prices soared and the global market fluctuated violently. At the same time, the US dollar liquidity crisis continues to ferment - deep in Wall Street, another alarm has been sounded: asset management giants led by Blackstone and BlackRock are trapped in the vortex of redemptions of private placement credit. This "shadow banking" system, which has expanded to US$1.6 trillion, is facing an unprecedented liquidity test. Under the series of negative impacts, the crypto market is on the verge of panic, and panic is on the verge of breaking out.

However, the expected crash did not come as expected. On the contrary, amidst the pessimism, the encryption market has shown amazing resilience. When the external stock market collapsed one after another, Bitcoin not only firmly held the $65,000 mark, but even once rose to $70,000, its performance was remarkable. At the same time, demand for hedging at the micro level is emerging - minutes after the air strike, capital outflows from Nobitex, Iran's largest exchange, surged 700%, with more than $13 million in crypto assets outflowing in just four days. This phenomenon is regarded by the outside world as a signal that Bitcoin’s safe-haven properties are heating up. However, Bitcoin's current round of strength is more like a deep repair - it naturally bottoms out after falling no longer, and it is also an active replenishment after the confidence of existing capital is restored.

First of all, from the technical perspective, there may really be little room for decline. Bitcoin’s monthly negative trend for five consecutive years has only occurred twice in the past 10 years; Ethereum’s monthly negative trend for six consecutive negative periods has only occurred twice in history. Continuous declines of this level are in themselves clear evidence of the exhaustion of short-selling power - there is no market that can only fall but not rise, and the emergence of extreme forms often heralds the approach of a trend turning point.

Historical data also supports this judgment. The last time Bitcoin had five consecutive negative monthly periods was from August 2018 to January 2019. At that time, after Bitcoin found a mid-term bottom, it ushered in a strong rebound that lasted for four months, with an increase of up to 340%. The trend of Ethereum is the same: every extreme decline ultimately accelerates the construction of a mid-term bottom.

The market always breeds hope in despair. While most people are still waiting in panic for a deeper abyss, the technical form has already quietly turned on the signal light at the bottom.

Secondly, the bottom characteristics of the market are also reflected in the turning point of stable coins and the recovery of the financing capabilities of crypto companies.

Since the market entered a deep bear market at the end of December last year, USDT has been at a discount for a long time, and its market value has also slowly shrunk, reflecting the ebb of speculative demand and the continued outflow of funds. However, this trend was completely reversed at the end of December - USDT returned to a positive premium, announcing the return of OTC funds and the restoration of market confidence.

At the same time, the financing capabilities of crypto companies have not been destroyed by the bear market. From March 2 to 8, Strategy spent US$1.28 billion to increase its holdings of 17,994 Bitcoins. This was the largest increase since its mNAV fell below 1, indicating that it still has strong hematopoietic capabilities. Coincidentally, another crypto treasury company, Bitmine, is still accumulating ETH at a rate of 50,000 ETH per week. Even when mNAV is also below 1, it still maintains a stable inflow of funds.

The return of stablecoin premiums, coupled with the increasing holdings of leading companies against the trend, all point to the same fact: OTC funds are flowing back, and smart money has begun to act.

Recently, the private equity credit crisis on Wall Street has intensified, and many people are worried that the liquidity crisis will once again hit the crypto market. But this possibility is actually very low - it is precisely the high liquidity sensitivity of the crypto market that gives it the unique "overshoot" attribute, and it can often complete adjustments before the crisis fully develops.

Historical experience provides strong evidence. In late March 2020, when the U.S. stock market was still struggling with the circuit breaker and crude oil fell to negative oil prices, cryptocurrencies had taken the lead in oscillating and stabilizing, bottoming out much earlier than commodities and traditional risk assets.

This is not accidental, but the inherent instinct of the crypto market: it is extremely sensitive to changes in liquidity and always prices and clears in advance when crisis signals first appear. While the mainstream market is still reacting, the crypto market is often already on the road to recovery.

This "advancement" essentially stems from the inherent anti-human nature of the encryption market. It always initiates the most violent decline when the market relaxes its vigilance, and then quietly completes the collection of chips and the construction of a bottom when all the shortcomings are exhausted and panic spreads.

The logic of the reverse layout has never changed: when retail investors leave the market out of fear and liquidity dries up, prices have often factored in the most pessimistic expectations; and smart money enters the market precisely at this time, trading time for space and waiting for the start of the next cycle.