#Gate广场创作者新春激励 SEC Chairman Sparks Fire, Cryptocurrency "Soars Overnight"! "Lethal Threat" Emerges Suddenly, What Is the Impact?

Cryptocurrencies are once again booming! Last night, the crypto market continued to explode, with Bitcoin briefly surpassing $96,500 this morning and Ethereum reaching $3,380. Other coins also experienced collective surges. So, what exactly happened? Analysts believe there are three main reasons:
First, on the 12th, U.S. Securities and Exchange Commission (SEC) Chairman Paul Atkins stated on social platform X that this week is crucial for the cryptocurrency industry. Congress is about to upgrade the financial markets of the 21st century.
Second, institutional demand has been reactivated.
Third, the recent performance of the US dollar has been somewhat hesitant. Meanwhile, some analysts believe that recently, Bitcoin has decoupled for the first time from the global M2 supply. Behind this may be a deadly threat: quantum computing.
Quantum computers are believed to have the ability to crack cryptocurrency encryption, with early blockchain wallets being especially vulnerable.
The long-dormant virtual currency market suddenly gained momentum last night, soaring sky-high. Bitcoin briefly broke through $96,500 this morning. Ethereum surged nearly 8%. In the past 24 hours, a total of 121,715 people worldwide experienced margin calls, with total liquidations amounting to $685 million. Besides economic data, Ryan Rasmussen, head of research at Bitwise, also stated that the instability of the global political and economic environment has contributed to Bitcoin’s rally, including the collapse of the Iranian currency and the political and economic turmoil in Venezuela.
Additionally, the U.S. Department of Justice has recently launched an investigation into Federal Reserve Chairman Powell, which is also seen as a factor influencing market sentiment.
But there are three main reasons: first, regulatory ignition.
On the 13th, early local time, Senate Banking Committee Chairman Tim Scott released the latest draft of the "Digital Asset Market Clarity Act" (CLARITY), which is expected to be submitted later this week for detailed review by the committee. This legislation, which concerns the structure of the cryptocurrency market, aims to establish clear rules for digital assets, protect retail investors, ensure future innovation, and safeguard national security. Paul Atkins stated on social platform X, “This week is crucial for the cryptocurrency industry. Congress is about to upgrade the financial markets of the 21st century. Among the actions we can take for investors now, the most important is to bring digital assets out of regulatory gray areas.” Second, institutional allocation demand has increased. Reports indicate that although confidence in Bitcoin purchases was not strong at the beginning of the year, and periods of hesitation persisted, recent institutional market dynamics are painting a more optimistic picture. Data on Bitcoin ETF net inflows show that after last week’s outflows, early this week, capital inflow exceeded $100 million on January 12. This broke the previous trend of outflows dominating institutional markets, indicating that short-term buying interest is beginning to re-emerge. Meanwhile, open interest contracts have also recovered to positive growth. This behavior suggests that liquidity, volatility, and participation in Bitcoin derivatives markets are increasing.
Third, the US dollar trend is relatively weak. U.S. annual inflation data shows no additional inflationary pressure forcing the Federal Reserve to adopt more aggressive monetary policies. Therefore, the outlook for neutral or lower interest rates limits the dollar’s ability to maintain stable buying in recent trading days. Currently, the DXY index, which measures the dollar’s strength against other currencies, is hovering around 99 points and has not gained new bullish momentum. The dollar’s hesitation has increased the attractiveness of cryptocurrencies. Retail investors have not yet returned, and threats have already emerged!
Cryptocurrency analyst Darkfost pointed out that Bitcoin spot ETF has experienced the largest liquidity withdrawal in history over the past period. Since reaching a record high in October last year, over $6 billion has flowed out, indicating a weakening of institutional capital momentum. Additionally, the market currently lacks retail investor participation. Data from CryptoQuant shows that demand from small investors (purchasing between $0 and $10,000) is extremely low, contrasting sharply with the scene during the bull market when retail investors flocked in. XWIN Research noted that the net fund flow into exchanges remains low, indicating that investors are currently mostly on the sidelines, not aggressively chasing highs or taking profits. Moreover, the market has also noticed that Bitcoin has decoupled from the global M2 supply for the first time. In a recent article on X, Edwards, founder of Capriole Investments, discussed how Bitcoin has recently decoupled from global liquidity. Historically, the percentage change of this cryptocurrency was usually similar to global M2 supply trends. But Bitcoin’s year-over-year change has stabilized in 2025, while the total money supply of major global economies has increased, indicating that Bitcoin has diverged from traditional liquidity. Edwards believes this is the threat posed by quantum computing to the network. Quantum computers are believed to have the ability to crack cryptocurrency encryption, with early blockchain wallets being especially vulnerable. It is still uncertain when quantum machines will achieve breakthroughs, but Edwards, the founder of Capriole, believes that BTC has entered the “quantum event horizon” by 2025. In theory, parties with sufficiently advanced quantum computers could infiltrate old dormant wallets and sell them on the market. This would not only directly impact Bitcoin’s price but could also undermine broader trust in cryptocurrencies themselves. However, some investors do not believe Edwards’ inference.