Liquidity, Not Narrative, Still Writes the Cycle
Every crypto bull-run has ultimately been a liquidity-run in disguise.
When global M2 expands or real yields collapse, the overflow finds its way to the riskiest zip-codes on the risk curve—and digital assets have historically been the first stop.
Since early-2024 the three main pipes feeding fresh fiat into the ecosystem—stable-coins, ETFs and tokenised Digital-Asset Trusts (DATs)—have all flattened simultaneously.
The result is an “involution” market: coins shuffling between coins, no net inflow, violent but short-lived rallies driven by liquidations instead of new buying.

The Three Pipes—and What the Meter Reads

1. Stable-coins (internal leverage & trading collateral)
   – Supply doubled from ~$140 B to ~$290 B in 18 months, but minting stalled in Q3 2025.

2. ETFs (TradFi passive allocation)
   – US BTC & ETH ETFs saw record inflows last winter, but creations have cooled to a trickle.

3. DATs (institutional yield wrappers that bridge TradFi repo rates and on-chain liquidity)
   – NAV grew from ~$40 B to ~$270 B, yet net subscriptions turned slightly negative last month.

Add the three together and the aggregate fiat proxy has barely budged since July even as global money supply keeps expanding.
The graph below shows the tight correlation between this combined gauge and total crypto market-cap; the flattening explains why bitcoin has been pinned between $58 k and $72 k for three months while equities print new highs.

Why Liquidity Is Choosing Treasuries Over Tokens
SOFR at 5.40 % still makes T-bills the world’s highest-yielding risk-free asset.
Quantitative-tightening has officially ended, but the US fiscal glut—$2 T of net Treasury issuance this fiscal year—continues to suck cash out of the private sector.
Money-market funds now park a record $6.4 T in short-dated government paper, draining the marginal dollar that might otherwise chase crypto beta.

Inside the Fishbowl: PVP Becomes the Only Game
With external taps closed, capital circulates internally:

• alt-season rotations last 48–72 hours before mean-reverting,

• open-interest spikes are met with immediate funding-rate spikes,

• break-outs fail at the first resistance because the buyer on the other side is simply another levered player, not fresh fiat.
  Market breadth has collapsed; 80 % of the top-200 coins are still below their 200-day moving averages even as BTC grinds sideways.

What to Watch for a Liquidity Re-boot
Any one of the following would signal that the cycle is leaving the involution stage:

• stable-coin supply growing >$5 B/week for two consecutive weeks,

• net ETF creations >$1 B/day for five days,

• DAT net subscriptions turning positive and pushing their combined NAV back above $280 B.

Until that happens rallies will remain short-covering bounces, not trend reversals.
In short, the liquidity is out there—it just hasn’t been invited back to the crypto party yet.

Liquidity, Not Narrative, Still Writes the Cycle
Every crypto bull-run has ultimately been a liquidity-run in disguise.
When global M2 expands or real yields collapse, the overflow finds its way to the riskiest zip-codes on the risk curve—and digital assets have historically been the first stop.
Since early-2024 the three main pipes feeding fresh fiat into the ecosystem—stable-coins, ETFs and tokenised Digital-Asset Trusts (DATs)—have all flattened simultaneously.
The result is an “involution” market: coins shuffling between coins, no net inflow, violent but short-lived rallies driven by liquidations instead of new buying.

The Three Pipes—and What the Meter Reads

1. Stable-coins (internal leverage & trading collateral)
   – Supply doubled from ~$140 B to ~$290 B in 18 months, but minting stalled in Q3 2025.

2. ETFs (TradFi passive allocation)
   – US BTC & ETH ETFs saw record inflows last winter, but creations have cooled to a trickle.

3. DATs (institutional yield wrappers that bridge TradFi repo rates and on-chain liquidity)
   – NAV grew from ~$40 B to ~$270 B, yet net subscriptions turned slightly negative last month.

Add the three together and the aggregate fiat proxy has barely budged since July even as global money supply keeps expanding.
The graph below shows the tight correlation between this combined gauge and total crypto market-cap; the flattening explains why bitcoin has been pinned between $58 k and $72 k for three months while equities print new highs.

Why Liquidity Is Choosing Treasuries Over Tokens
SOFR at 5.40 % still makes T-bills the world’s highest-yielding risk-free asset.
Quantitative-tightening has officially ended, but the US fiscal glut—$2 T of net Treasury issuance this fiscal year—continues to suck cash out of the private sector.
Money-market funds now park a record $6.4 T in short-dated government paper, draining the marginal dollar that might otherwise chase crypto beta.

Inside the Fishbowl: PVP Becomes the Only Game
With external taps closed, capital circulates internally:

• alt-season rotations last 48–72 hours before mean-reverting,

• open-interest spikes are met with immediate funding-rate spikes,

• break-outs fail at the first resistance because the buyer on the other side is simply another levered player, not fresh fiat.
  Market breadth has collapsed; 80 % of the top-200 coins are still below their 200-day moving averages even as BTC grinds sideways.

What to Watch for a Liquidity Re-boot
Any one of the following would signal that the cycle is leaving the involution stage:

• stable-coin supply growing >$5 B/week for two consecutive weeks,

• net ETF creations >$1 B/day for five days,

• DAT net subscriptions turning positive and pushing their combined NAV back above $280 B.

Until that happens rallies will remain short-covering bounces, not trend reversals.
In short, the liquidity is out there—it just hasn’t been invited back to the crypto party yet.