Thursday's early morning plunge directly shattered everyone's expectations. Bitcoin suddenly crashed below $86,000 within just a few hours, with a 24-hour decline of nearly 3%, leading to nearly $600 million in liquidated contracts and 170,000 retail investors forced to close positions. But this is not the most terrifying part—the real bombshell was two messages released only in the early morning.

The Bank of Japan is about to announce a 25 basis point rate hike on Friday, which in the crypto world is known as the "Crash Trigger." Historical data doesn't lie: since 2024, every time the Bank of Japan acts, Bitcoin has at least dropped 20%. Looking at the specifics—March's drop was 23%, July's was 26%, and January this year even crashed 31%. The market is already pricing in this rate hike in advance, with the bulls being ruthlessly pushed to the floor.

Even more heartbreaking is the personnel change at the Federal Reserve. The probability of former Governor Waller becoming the new hawk has skyrocketed from 7% to 48%. This person is known for his tough stance on liquidity management. Last week, the Federal Reserve officially cut rates by 25 basis points, but behind the scenes, they slashed the expected rate cuts in 2026 down to only one—meaning liquidity tightening is underway, and the water in the crypto circle will be drained.

From a trading perspective, never be fooled by any short-term rebounds. Market reactions tend to be faster and more violent than expected. In such an environment, taking short positions on rallies is the rational choice. The danger in crypto markets has never been the decline itself, but the illusion that "it won't fall again." Calmly assess the trend, control risk exposure—this is the key to surviving until the next bull market.