- Declining TGA reflects positive liquidity that creates room for a risk rally.
- $50 billion of the TGA drop was due to interest on treasury securities.
Arthur Hayes, the BitMex CEO, has called on his Twitter followers to stay alert over the developing market conditions. Hayes informed users that a declining Treasury General Account (TGA) reflects positive liquidity that creates room for a risk rally unless there is a reaction from the U.S. Federal Reserve.
Hayes’ alert and projection backed his earlier analysis of the crypto market when he acknowledged having his antennas set for new signals after missing the initial rally of January 2023. In that analysis, Hayes identified the TGA as a strong indicator that will impact crypto prices significantly in the coming months.
According to Hayes, TGA figures continue to drop, and the need for US Treasury Department to inject liquidity into the economy will required soon. This liquidity injection will improve the risk averseness of investors, leading to increased funds flow into risk assets like cryptocurrencies.
In his latest tweet, Hayes’ showed that the TGA had dropped to $439.7 billion. At the time of writing, the value had fallen even further to $406.7 billion.
One of the respondents to Hayes’ tweet outlines a few reasons behind the sharp decline of TGA in the past 24 hours. According to the respondent, $50 billion of the drop was due to interest on treasury securities, while $6 billion was due to public debt. The respondent also pointed out the trajectory in the TGA that occurs at three-month intervals. There is always a huge drop due to interest on treasury securities after three months.
A second respondent noted that $25 billion of the drop was due to SSA benefits payments scheduled for specific days of every month. These events align with Hayes’ original prediction of how the market could develop in the coming months.
The BitMex CEO’s alert is for focus from his followers. He did not call for any specific action, as expressed by some respondents who may be waiting on an entry signal from the renowned crypto market analyst.