At the moment the market opened on Wednesday, the chart immediately showed a free fall—Nasdaq futures dropped 1.6% in the blink of an eye, even more aggressive than Bitcoin, which plummeted 6% within half an hour. The sea of green on the screen made people feel anxious.

The chat groups instantly became lively, with calls of "black swan" echoing one after another. Many people were so scared they cut their positions directly. But I carefully analyzed some key data and quickly realized: this was not an unexpected event at all; it was simply obvious that funds were being drained.

First, look at the U.S. Treasury. The government shutdown lasted 38 days, and the TGA account was already empty. Last week, they urgently issued 163 billion USD in short-term Treasury bonds, forcing the market to take real money, effectively withdrawing over a hundred billion in liquidity. The stock and crypto markets rely heavily on capital; such draining of funds naturally leads to declines.

Next, consider the Federal Reserve's stance. A statement that "the policy path is not yet decided" immediately cut the December rate cut expectation from 70% to 45%. Short-term funds quickly deleveraged overnight, with a flood of liquidation orders, tightening liquidity even further, causing the decline to accelerate.

Finally, there's a hidden clue—the tension in the interbank market. The scale of the Fed's emergency liquidity tools has soared to post-pandemic highs, and interbank overnight borrowing has become tight. On the surface, the market doesn't seem short of money, but all the active cash is locked up in Treasury issuance and reverse repos, preventing it from flowing into stocks and crypto.

Honestly, this round of sharp decline does not mean a bear market is coming. As long as the government shutdown ends and the Fed shows some easing signals, the drained funds will quickly flow back. Currently, panicking and selling at the bottom only leaves chips on the floor; those holding cash should focus on oversold leading stocks—that's the right move.