One of the clearest signals of a bearish market phase comes from a key correlation.

From a technical perspective, the simultaneous decline in stablecoin market cap and risk-asset valuations suggests that investors are not simply rotating into defensive positions. Instead, they are exiting the ecosystem altogether.

In other words, rather than seeking refuge in stablecoins, capital appears to be flowing out of the market, reflecting a clear reduction in risk exposure.

To put this into perspective, the stablecoin market has contracted by more than $7 billion in less than 21 days, while investors have pulled $400 billion from the crypto market. Of course, that easily highlights this liquidity exodus in real time.

What makes this cycle…