Finance expert Levi Rietveld has released an “XRP Emergency Update,” sharing a video in which macro investor Raoul Pal explains the latest developments in U.S. Treasury policy and their implications for financial markets, particularly digital assets.
The update places a strong focus on liquidity dynamics, offering a clear view of how Treasury decisions influence the performance of risk-sensitive markets such as cryptocurrencies.
XRP Emergency Update#XRPpic.twitter.com/bVf1SpY7Op
— Levi | Crypto Crusaders (@LeviRietveld) October 1, 2025
Treasury General Account and Liquidity Withdrawal
In the video, Pal explains that since mid‑July, the U.S. Treasury has been issuing bonds to replenish its Treasury General Account (TGA). This process effectively withdraws cash from the financial system, reducing overall liquidity.
According to Pal, approximately $500 billion has been drained from the system through this process. Such a substantial withdrawal of liquidity has inevitably weighed on markets, including equities. However, it has impacted the digital asset space, which tends to react more strongly to shifts in liquidity conditions.
Why Crypto is Most Affected
Pal emphasized that cryptocurrencies, as high‑beta assets, are among the most sensitive to liquidity fluctuations. While stocks and other markets have felt some of the impact, crypto has absorbed the brunt of it.
This explains the recent weakness seen across digital assets, including XRP, which has been trading within a tight range as investors weigh the effect of diminished liquidity. The reduction in available capital makes it difficult for risk assets to gain momentum, limiting both price growth and investor sentiment.
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A Turning Point for Markets
Despite the strain over the past months, Pal noted that the period of liquidity withdrawal appears to be nearing an end. He explained that the Treasury General Account is now sufficiently replenished, meaning further bond issuance for this purpose is no longer necessary.
If this marks the conclusion of liquidity tightening from the Treasury’s side, it could open the door for stabilization across risk markets. For XRP and other cryptocurrencies, this could mean an improved environment moving forward, where price performance is less constrained by liquidity pressures.
Rietveld’s decision to highlight Pal’s explanation underscores the importance of macroeconomic developments for digital asset markets.
XRP holders and market participants are reminded that external factors such as U.S. Treasury actions can significantly shape near‑term price behavior. With liquidity pressures potentially easing, the outlook could shift toward recovery. Howbeit, investors remain cautious due to broader economic uncertainty.
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