4E: The cryptocurrency market may introduce a "circuit breaker" mechanism, and Powell has released a strong signal for interest rate cuts

ChainCatcher news reports that, according to 4E observations, the recent crash in the cryptocurrency market has exposed structural issues in exchange liquidation and risk control. Some platforms profited during extreme market conditions, while others lost hundreds of millions of dollars. Industry reports indicate that automated liquidation systems designed to provide liquidity have instead amplified market chaos during severe fluctuations, prompting institutions to reassess risk management.

10x Research points out that the industry is discussing whether to adopt traditional finance's "Circuit Breakers" to limit extreme volatility. If implemented, this mechanism could permanently alter the volatility structure and profit logic of the cryptocurrency market. The report recalls that similar systemic reflections last occurred after Musk announced Tesla would stop accepting Bitcoin payments in 2021.

On the macro front, Federal Reserve Chairman Powell warned in a speech early this morning that the U.S. labor market is cooling, suggesting support for another 25 basis point rate cut. He noted that "the risks to employment have increased," and even though official data is delayed due to the government shutdown, the Fed's internal research is sufficient to support a rate cut decision.

As a result, the yield on 30-year U.S. Treasury bonds fell to 4.60%, hitting a new low since April.

Additionally, U.S. Republican Congressman Troy Downing has proposed the "Retirement Investment Options Act," which aims to include cryptocurrencies and private equity in the investment scope of 401(k) retirement plans. This means that the executive order from the Trump era is likely to be formally enacted into law, paving the way for cryptocurrency assets to further integrate into mainstream investment channels.

4E reminds investors: If the "Circuit Breaker" mechanism is officially introduced, it will mark a key step towards institutionalization and risk management in the cryptocurrency market. However, the short-term liquidity and volatility structure may undergo drastic changes, necessitating careful attention to the chain reactions of market institutional reforms.