- Treasury’s TGA nears $1T after heavy borrowing, draining liquidity but setting up for a strong reversal post-shutdown.
- Quinten says a “liquidity storm” may hit as TGA declines and QT ends, potentially fueling risk asset recovery.
- Bitcoin indicators show mid-cycle strength, with Pi Cycle, MVRV, and Reserve Risk far from historic top levels.
The U.S. Treasury General Account (TGA) has surged to nearly $1 trillion, a level last seen during the pandemic stimulus period. The balance was at $953.56 billion on November 6 after surpassing $1 trillion on October 30.
The buildup followed a government shutdown and heavy Treasury borrowing to rebuild reserves depleted earlier this year. As liquidity tightens across markets, analysts including Quinten note that the TGA’s dip phase could release substantial liquidity back into the financial system.
That shift, combined with the Federal Reserve’s plan to end quantitative tightening (QT) in December, points to a major liquidity switch ahead, one that could impact risk assets like Bitcoin first.
Treasury Cash Swings
The TGA balance has experienced sharp fluctuations throughout 2025. It started near $650 billion in January, rose to about $850 billion in February, then dropped below $300 billion by April.
The account hit its lowest point of around $250 billion in July before rebounding steadily toward $900 billion by late October. This pattern reflects the Treasury’s cash management during periods of debt ceiling constraints and subsequent rebuilding phases.
Following the shutdown resolution, the Treasury borrowed over $1 trillion in the third quarter to restore its cash buffer to its target near $850 billion. However, this rapid borrowing has drained liquidity from the broader system, reducing bank reserves and contributing to recent market volatility.
Analysts See Liquidity Reversal as Shutdown Ends
Quinten stated that once the government resumes full operations, the TGA balance will likely decline, effectively releasing liquidity back into the market. This transition could coincide with the end of QT, amplifying the liquidity influx.
He described the setup as a “liquidity storm” that historically benefits risk assets first. Reports also indicate that several lawmakers are working to finalize a resolution, a move that could unlock parked funds from the Treasury.
The combination of TGA dips, QT’s conclusion, and rising overnight repo demand signals mounting pressure on dollar liquidity, conditions that often precede policy intervention.
Bitcoin Cycle Indicators Far from Peak
According to Bull Theory, Bitcoin’s long-term on-chain metrics suggest the market has not reached a cycle top. The Pi Cycle Top Indicator, currently around 49%, remains well below crossover levels historically associated with peaks.
The MVRV Z-Score stands near 2, far from the euphoric readings above 6 seen at prior tops. Meanwhile, the Bitcoin Reserve Risk metric shows long-term holders maintaining strong conviction, with no signs of widespread selling.
Combined with rising global M2 liquidity, these data points suggest the crypto market is still in a mid-cycle phase, awaiting potential expansion once monetary conditions ease.
