GM. This is Milk Road, the crypto newsletter more reliable than that one friend of yours who's always swearing "This coin is different”.
Here’s what we’ve got for you today:
- ✍️ Breaking down the $9T bust & recovery.
- 🎙️ The Milk Road Show: Where to Invest in Crypto When 90% of Projects Are Uninvestable w/ Ryan Connor.
- 🍪 New Fed Chair was just announced!
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Prices as of 2:00 p.m. ET. Trade today with Milk Road Swap.
BREAKING DOWN YESTERDAY’S $9T BUST & RECOVERY 📉
Yesterday, we watched $5.4T evaporate from global markets in the span of a few hours…
- Gold down 8.2% ($3T gone).
- Silver down 12.2% ($760B wiped).
- S&P 500 down 1.23% ($780B removed).
- Nasdaq down 2.5% ($760B shed in hours).
- Bitcoin down 4.34% ($100B quickly erased).
Followed by a whiplash-inducing reversal…
- Gold added back nearly $2T by close.
- Silver staged a $500B recovery.
- The S&P clawed back $530B.
- Nasdaq recovered $580B.
- BTC? Only $22B (oof!)
$5.4T down → $3.6T back up → a total of $9T in movement over a few hours.
And Bitcoin sat out most of the recovery. Yikes!
Now, as my father likes to say ‘every setback presents you with an opportunity to learn’ (yuh, super optimistic guy - borderline annoying).
So what can we learn from this?
Lesson 1: Traditional assets have deeper liquidity pools.
Gold can lose $3T and recover $2T in the same session because institutional money flows are massive and the infrastructure is mature.
Crypto doesn't have that cushion yet.
When BTC dumps, the recovery is slower and weaker because the buyer base is still comparatively thin.
Lesson 2: Coordinated selloffs reveal what's actually correlated.
Everyone talks about BTC being uncorrelated to traditional markets.
Days like this prove it doesn’t yet have that luxury.
When real panic hits, everything sells together.
Lesson 3: Recovery speed tells you everything about market confidence.
Gold and equities bounced hard because institutions saw value and stepped in.
BTC's weak $22B rebound out of a $100B drawdown suggests hesitation.
Either buyers aren't convinced this is the bottom, or there simply aren't enough of them ready to deploy.
And btw - recovery doesn’t necessarily last. Gold & silver are already back below yesterday’s bottom. 👇
Ok, well that stinks. And honestly, that’s no way for us to send you into the weekend (shame on us).
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BREAKING DOWN YESTERDAY’S $9T BUST & RECOVERY (P2) 📉
Right now, there is ~$13B in leveraged BTC shorts stacked against just $1B of leveraged longs - that's a 13:1 imbalance!
Here’s what that actually means…
Liquidation maps show where leveraged positions will get forcibly closed if the price moves against them.
When a short gets liquidated, it forces them to re-purchase the asset. Lots of shorts liquidating at once creates cascading buy pressure.
(These are the mechanics behind a short squeeze.)
Price goes up, shorts get stopped out, their liquidations push price higher, more shorts get stopped out.
Rinse and repeat.
The asymmetry here is extreme. If BTC pushes toward $90K and beyond, it enters a zone dense with short liquidations.
Each level breached could trigger the next wave of forced buying. Meanwhile, downside liquidation risk is comparatively thin.
Now for the reality check…
We just saw over 267,000 BTC traders get wiped out in a single day. Price dropped 10% from recent $90K highs.
So we might not have the market confidence needed to pull this off.
(Liquidation maps show potential, not destiny.)
That said…
The potential is there, and that’s a silver lining if we’ve ever seen one.
BITE-SIZED COOKIES FOR THE ROAD 🍪
This seems too good to be true. Nexo’s “Zero-interest credit” lets you borrow $BTC or $ETH with no yearly interest or fee.*
New Fed Chair was just announced! His name is Kevin Warsh and he loves BTC very, very much (say ‘Hiiii Kevin’).
This would explain a lot: Bitwise’s 2025 'Stealth Bear Market' theory…
PPI data came in HOT (that’s bad) - here’s how it could affect the 2026 market outlook.
Tax season is approaching. If you’re looking for crypto tax software, we’ve outlined the top choices, here.
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