What is the current situation of "liquidity" that people are most concerned about Firstly, macro liquidity refers to the abundance of funds in the global financial system, First of all, let's talk about the overall conclusion. Global central banks are still withdrawing funds from the market, but the intensity and speed of the withdrawal have slowed down. The most tense stage may be passing, and now we are at a turning point. Flipping through data from the Federal Reserve: Shrinking balance sheet: As of July 2, 2025, the total balance sheet of the Federal Reserve has dropped to $6.66 trillion, a decrease of approximately $562 billion in the past year. It is still continuing to withdraw base currency from the market, but at a significantly slower pace . At the same time, two indicators show that a large amount of funds have not become active in the economy: 1) the overnight reverse repo (RRP) balance is as high as $631.1 billion, which is the idle money left by financial institutions in the Federal Reserve; 2) The balance of the Treasury Department's General Account (TGA) has rebounded to $372.2 billion, a portion of which was temporarily seized by the US government from the market for liquidity. The most important thing is M2. The US M2 rebounded to $21.94 trillion in May, an increase of about 4.2% year to date, but this growth rate is far lower than the high point of 2021-2022. The weak momentum of currency creation also indirectly confirms that we have never entered a true bull market. On the contrary to the macro level, the liquidity of the cryptocurrency market itself is very abundant Stablecoins are rapidly expanding, with a total market value of approximately $255.6 billion. Among them, USDT holds an absolute dominant position with a scale of $158.6 billion, accounting for 62%, while USDC ranks second with a scale of $62.2 billion (accounting for 24%). Stablecoins are the most direct base currency in the cryptocurrency market, with USDT and USDC alone adding approximately $48 billion in supply by 2025, and liquidity has been consistently at full capacity. In addition, Tether holds more than 120 billion U.S. treasury bond, and its interest income can feed back its stable currency issuance, which means that there is a continuous blood supply pump for crypto liquidity. Even without stablecoins, the total locked value of Defi exceeds $116 billion, and the TVL of lending agreements reaches a historical high of $55.6 billion. Does encryption lack liquidity? In fact, there is no shortage, but most of the liquidity is earning relatively stable returns and has not directly flowed into the secondary market. We can still look forward to the knockoff season.