Conclusion first: The World Cup will definitely periodically withdraw liquidity from the crypto market, divided into three completely different phases: "pre-match, during the match, and post-match," with separate logic for overall market liquidity and sector-specific liquidity. This is layered with variables such as time zones, capital diversion, and sentiment. Below is a detailed breakdown of the complete pattern (only market pattern science, not trading advice):

1. During the match, overall market: dual-direction bloodletting, overall liquidity contracts (most core)

Liquidity loss is divided into attention-based liquidity and real capital flow:

1) Attention loss (retail traders are the main market makers in crypto)

Retail traders account for over 60% of intraday short-term orders in crypto. During the World Cup, many traders stop monitoring prices and reduce order placements:

• Order books thin out, market depth declines, the same amount of funds can cause larger slippage and price impact;

• On-chain active addresses, spot & derivatives trading volume generally decrease by 15%~35% month-over-month, leading to more volatile large swings and increased long-short explosions;

• Time zone amplification effect: The 2026 World Cup matches in the US, Canada, and Mexico occur during Beijing daytime, causing Asian trading hours (the largest trading period in crypto) to become hollowed out, making unwarranted price spikes more likely during the day.

2) Real capital outflows, high-risk funds diverted through two main channels

1. Traditional sports betting: The global World Cup betting market involves hundreds of billions of dollars, with many speculative funds selling BTC/altcoins to convert to fiat for betting, representing permanent exit funds that won’t return to crypto after the event;

2. On-chain prediction markets (like Polymarket): Internal capital shifts within the community, moving from mainstream coins to World Cup prediction contracts, reducing overall market stock; this is internal fund reallocation, and after the event, funds tend to flow back into the main market;

3. Retail liquidation: Selling holdings for pocket money or entertainment, further reducing available margin in the market.

Review of past tournaments: During the 2018 and 2022 World Cups, BTC trading volume significantly shrank during the main event, with most markets oscillating weakly; 1-2 weeks after the World Cup ends, idle funds flow back, often triggering a recovery rally.

2. Sector-specific liquidity: World Cup-themed coins are a "liquidity siphoning black hole"

Funds do not disappear into thin air but concentrate on football-related concepts, creating a stark contrast:

Phase 1: 15~20 days after kickoff (pre-match hype)

Funds withdraw from BTC and mainstream altcoins, focusing on fan coins (CHZ), national team meme coins, causing a surge in sector liquidity and passive shrinkage of overall market liquidity, representing sector capital rotation.

Phase 2: During the main event (sell the news landing phase)

Positive news is realized, major players sell in batches:

• Football-related tokens’ liquidity rapidly dries up; the more exciting the matches, the more decisive the sell-off, often with winning team coins also plunging;

• Some funds cash out to bet or hold cash, with very little returning to the main market, further pressuring overall liquidity.

Phase 3: Knockout stage/finals

Sector funds mostly exit, either cashing out into fiat or waiting for the event to end before re-entering the main market, with the market generally in a stockpile bottoming phase.

3. Three special variables that determine the extent of liquidity contraction

1. Stock market vs. incremental market
In a bull market with ample new capital, the diversion impact of the World Cup is minimal; in a bear or sideways market with tight existing funds, the bloodletting effect is amplified, often coinciding with short-term bear market catalysts.

2. Whether other major capital events occur simultaneously
For example, IPOs, US stock mainline trends, Federal Reserve rate decisions can cause multiple liquidity drains, leading to extreme liquidity dryness.

3. Leverage market changes
From cautious capital → reduced margin collateral → decreased derivatives market liquidity, with forced liquidations more likely to trigger chain reactions of margin calls and liquidations.

4. Practical summary of liquidity features

1. Main market: during the main event, depth worsens, slippage increases, unwarranted price spikes become more frequent; avoid heavy leverage positions;

2. Sector coins: only suitable for pre-match positioning; the start of the match is a certain-out window for selling, do not gamble on match results to determine coin prices;

3. Time window: 7~14 days after the finals, capital and sector funds gradually flow back, and liquidity gradually recovers.