Last night's crypto market surge reveals the truth: the US economy is flashing red lights, and these three issues should have been on your radar long ago!

Last night, the crypto market skyrocketed, and many people woke up in the middle of the night to check the charts. Those who missed out are now kicking themselves. As a seasoned market observer with five years of experience, I’ve identified three key reasons. After reading this, you'll understand why funds are rushing into the crypto space.

First, US economic data has collapsed. Private sector layoffs have surged dramatically, and the latest employment figures are shockingly poor, leading the market to bet that the Federal Reserve will have to cut interest rates in December. More notably, the Fed’s emergency liquidity tool, the SRF borrowing volume, plummeted from 50 billion to zero, indicating that the liquidity crisis has been resolved and big money is willing to enter the market. Bitcoin was the first to lead the charge.

Second, Americans themselves are panicking. Data from the University of Michigan shows consumer confidence has fallen to its lowest in three years, with 71% expecting unemployment next year. With high prices and job insecurity, ordinary people are either hoarding cash or seeking assets that can hedge against inflation. Cryptocurrencies have become a smart safe haven for the savvy investors.

Third, inflation expectations have decreased. The latest data from the New York Fed shows that one-year inflation expectations have fallen from 3.38% to 3.24%. Although still high, the trend is downward. The market interprets this as the Fed being unable to withstand high inflation anymore, possibly accelerating rate cuts. Hot money is about to flood in, and high-elasticity assets like cryptocurrencies will benefit the most.