Today, with this big dump in the market, I finally figured out where the root cause lies. There are all sorts of rumors online—some say it's due to tightening domestic regulatory policies, while others claim Powell is going to resign early. First, regarding the former, if it were really a regulatory issue, the market would have dropped long before the weekend, not waiting until today. As for Powell, his term ends in June next year, and judging by his style and professional ethics, it’s unlikely that he would suddenly resign at this point, even if Trump puts pressure on him.

The real trigger was the interest rate hike signal released by the Bank of Japan. Between seven and eight o'clock this morning, as soon as the news broke, the exchange rate of the yen against the dollar experienced an instant fluctuation, and the crypto market almost simultaneously began to plummet, with the timeline perfectly matching. The impact of this is not just for one or two days — the Bank of Japan's hawkish stance means that an important faucet of global liquidity is about to start tightening.

In recent years, the market has relied on major central banks to maintain liquidity through monetary easing. Now, Japan is not only refraining from easing but is also looking to withdraw liquidity, which naturally tightens the funding situation. In the short term, this wave of adjustment may not be over yet.

Next, we need to look at the attitude from the U.S. If it can exert some influence on Japan and slow down the interest rate hike pace, the market may catch a breather. However, if the Bank of Japan is really determined to tighten its monetary policy, the depth of this adjustment may exceed many people's expectations. A tightening of liquidity has never been good news for risk assets.