After the Prince Center incident, the claims that Bitcoin's decline is due to the Prince Center being confiscated by the US government should really stop.

Recently, some people have attributed this round of adjustment in Bitcoin to the US government seizing 120,000 BTC from the Prince Center, claiming this proves the myth of Bitcoin's decentralization has been shattered and that it will go to zero. This logic is full of flaws and completely ignores historical facts.

As early as when Silk Road was shut down, the US, Germany, and the UK all confiscated large amounts of Bitcoin, yet the market still steadily rose. Incidents like Chen Zhina's are just isolated insider betrayals and do not constitute industry-wide negative news. If Bitcoin would collapse simply because it "cannot be used for gray and black markets," it would have disappeared long ago. The Prince Center incident is also not enough to shake the market's fundamentals.

**The real cause of the decline: liquidity exhaustion**

The essence of this adjustment is simple—there's no one to buy in the market anymore. The order book's buy side is nearly at the bottom, which is a typical sign of a liquidity crisis. Looking at recent macro factors helps to understand: Amazon and Meta are actually issuing bonds to finance AI development, a move rarely seen in the past three years. This indicates that the cash flow of top tech companies can no longer support the burning of money for AI. Meta has been questioned by the capital market, and its stock price has almost given back the year's gains.

When leading companies start to lack funds and need to recover cash, how can the market not be alert? The total dollar supply in the market is decreasing, and institutions are forced to sell assets to stop the bleeding. Plus, the big crash on October 11 shattered the entire crypto ecosystem's market sentiment, which has not fully recovered to this day.

**The true source of selling pressure: Bitcoin ETFs**

If we look for specific sellers, Bitcoin ETFs (especially iBIT) are the key. These products bring a large amount of institutional liquidity but also create institutional-level redemption pressure. When the market is under the tension of dollar liquidity, a wave of redemptions becomes an unstoppable force.

Expectations of Fed rate cuts have weakened, and factors like Bitcoin's four-year cycle have accumulated, but none of these are decisive variables. The decisive factor is—dollar liquidity is tightening.

**Bitcoin ≠ a safe-haven asset**

Some still consider Bitcoin a safe-haven asset, but that's purely imagination. The essence of Bitcoin is as a reserve asset and an inflation hedge tool, not a safe-haven. Safe-haven assets see panic funds flowing in, but Bitcoin's price movements are entirely determined by dollar liquidity—more dollars mean higher prices, tighter dollars mean lower prices. In simple terms, Bitcoin is a barometer of dollar liquidity.

As long as the dollar supply in the market is sufficient and buying pressure is strong, even large sell-offs can be absorbed. Shorts need to break through any key levels, but they must first eat through accumulated buy orders. That's why liquidity is the top priority.

So, don't link this market movement to "black market money laundering regulation," as that's just speculation by amateurs. The real logic of the market is much more complex.

**Current BTC price**: 87.24K | **24-hour performance**: -0.18%