[Analyst Proposes Institutional Liquidity Index (ILI): Identifying Cycle Tops with 'New Price Highs, Lack of Institutional Funds'] According to a report by Jinse Finance, on September 26, CoinKarma founder Benson Sun published an article introducing his new indicator, the 'Institutional Liquidity Index' (ILI). The index is composed of overall USD liquidity, MicroStrategy's mNAV, and BTC ETF net inflows, with a core focus on observing whether institutional funds keep pace when BTC reaches new highs. If BTC's price hits a new high while the ILI is lower than its previous peak, it indicates a divergence between price and institutional liquidity. The divergences are categorized into two levels: - **Yellow Divergence**: BTC hits a rolling 30-day high, and the ILI diverges. - **Red Divergence**: BTC breaks an all-time high, the ILI diverges, and the ILI falls below 50. Backtesting shows that both instances of red divergence coincided with cycle tops: November 8, 2021, marked the highest closing price of that cycle, and October 5, 2025, the day after, marked the highest closing price of that cycle. Following these, BTC experienced maximum drawdowns of 77% and 53%, respectively. Among five instances of yellow divergence, four saw local tops within 10 days, followed by declines of 19% to 29% over the next 90 days. The sole exception was July 9, 2025. The author believes that after 2021, BTC's primary buyers shifted from retail investors to institutions (public companies, spot ETFs, corporate treasuries). These entities primarily buy spot BTC and avoid perpetual contracts. Combined with delta-neutral arbitrage suppressing funding rates, traditional overheating signals have become ineffective, necessitating new indicators to fill the gap. The author predicts this cycle will be a slow bull market, with multiple yellow divergences appearing before any red divergence. In terms of strategy, the number of yellow divergences can be used as a cycle gauge, gradually reducing exposure to altcoins and leverage. When a red divergence appears, it signals a complete exit.