The rules behind capital operations: Why do retail investors always get caught when Americans dump the market?

The recent plunge of Bitcoin may seem sudden, but there are clues to its underlying logic. When you see BTC hovering around $84.98K in the Asian market with a 24-hour decline of -1.11%, behind this movement lies a carefully orchestrated three-layer operational logic by American capital.

Cross-Regional Arbitrage: Capital Flows Behind Price Discrepancies

Data shows that Bitcoin prices on US trading platforms are 3% lower than in Asia. This is not simply a currency exchange difference but an institutional capital manipulation of regional price gaps. When Asian investors push prices higher during the day, Wall Street meanwhile sells off holdings at lower prices during the late night—this “time zone arbitrage” essentially harvests retail investors through liquidity disparities.

The reason US capital chooses to dump assets late at night is precisely to exploit Asian market participants’ resting hours, pushing prices down in an environment lacking counterforces. When the Asian markets open and find the price has already fallen, most retail investors panic and sell, inadvertently becoming counterparties for institutional accumulation.

Year-End Tax Planning: Why Whales Are Cashing Out Intensively Now

Long-term investors holding coins for years tend to sell heavily at year-end. Behind this phenomenon is the complex operation of the US tax system. Institutional investors often lock in losses at the end of the fiscal year to offset capital gains taxes. Once their tax planning is complete, they buy back the same holdings at lower prices in the next fiscal year—this “loss” is ultimately borne by retail investors.

Investment reports from firms like Fidelity show that year-end heavy selling has become a routine on Wall Street. Retail investors who do not understand this logic are easily misled during the “loss-locking period,” leading them to sell assets they might otherwise hold long-term.

Liquidity Contraction: How Federal Policies Impact the Crypto Market

US government fiscal policies directly influence market liquidity. When a government shutdown causes structural changes in fiscal operations, the funds that would normally flow into the market are frozen, making cryptocurrencies—viewed as risk assets—particularly vulnerable. The sharp short-term declines in US-listed crypto-related stocks are a direct reflection of liquidity tightening.

This macro-level shock is often overlooked by retail investors—they focus solely on technical analysis but remain unaware that market volatility stems from policy decisions made far away in Washington.

Think in Reverse: How Rule Makers Respond

Investors who truly understand the market mechanisms tend to position themselves during panic. While everyone else is selling off, these players are accumulating. Every major Bitcoin correction is an opportunity for institutions to readjust their positions.

Those who “know who controls tomorrow” are not the retail traders following the herd but observers who understand the logic of US capital operations, the cycles of tax planning, and shifts in liquidity.

This round of correction is essentially a “structural harvest” of the market by US dollar capital. But the key question is: are you passively accepting these rules, or actively understanding and adapting to them?