Bitcoin’s ongoing selloff may deepen as upcoming U.S. Treasury operations are expected to drain roughly $150 billion in liquidity from the financial system, according to Michael Kramer, founder and CEO of Mott Capital Management.
In a market analysis note, Kramer warned: “In my experience, Bitcoin tends to be a better liquidity indicator than most other instruments. If the Treasury settlements are a drain on liquidity, then Bitcoin could be heading much lower.” The Treasury regularly issues bonds and bills to finance government spending, and when it sells new securities, it pulls cash from the banking system, reducing the pool available for risk assets like cryptocurrency.
Kramer detailed that Treasury operations from May 28 to June 5 will include:
- $15 billion in T-bills settling on May 28
- $47 billion in coupon settlements on May 29
- $68 billion on June 1
- $16 billion in T-bill settlements on June 2
- Another T-bill settlement on June 4 estimated between $5 billion and $15 billion
Early signs are already visible: Bitcoin has dropped about 11% from highs above $82,500 earlier this month, trading near $73,000, and a breakdown of key support near $75,000 signals tightening liquidity. While not a guaranteed decline, Kramer’s analysis underscores that macro forces like government borrowing can quietly exert significant influence on Bitcoin’s price.
