The Bitcoin Conspiracy at $110,000: How $2.7 Billion in ETF Ammunition Crushed the Shorts
On June 3, 2025, the trading screens in Wall Street’s trading hall were suddenly awash in a sea of red. The price of Bitcoin surged past the $110,000 mark, and in just one hour, short positions were collectively liquidated. $2.7 billion in funds poured into Bitcoin spot ETFs, driving the price to an all-time high. A trader at the Chicago Mercantile Exchange stared at the screen and muttered to himself, “This isn’t a retail frenzy; it’s a precision slaughter by capital using ETFs as the new weapon.”
1.Macro Shift: Policy Tailwinds Ignite Institutional Ammunition
As the Federal Reserve’s signal to cut interest rates resonated with the cooling of inflation, a covert capital encirclement of the crypto market was quietly launched. In May 2025, the U.S. core PCE inflation rate dropped to 2.52%, its lowest level in two years. Meanwhile, the Federal Reserve signaled its intention to cut rates, indicating that the floodgates of dollar liquidity were about to open. This signal was quickly picked up by Wall Street – $3.03 billion flowed into the BlackRock Bitcoin ETF in a single week, setting an annual record. The Norwegian Sovereign Wealth Fund also covertly held 42,000 Bitcoin, worth over $4.6 billion.
An even deeper policy conspiracy emerged. The Trump administration appointed PayPal Mafia veteran David Sacks as the White House Crypto Currency Chief. Upon taking office, he swiftly pushed for the implementation of the GENIUS Stablecoin Act. This act mandates that stablecoins be 100% backed by U.S. Treasury bonds, deeply integrating the crypto market with the dollar hegemony. With the looming $36 trillion U.S. debt crisis, Bitcoin was given the strategic status of “digital gold,” becoming a new fulcrum for the dollar system.
2.Short Slaughter: ETFs as Wall Street’s New Arsenal
Traditional short-selling forces were left reeling in the face of the ETF suction effect. On June 3rd, $2.7 billion in ETF funds struck at three critical weak points like a surgeon’s scalpel:
2.1 Liquidity Trap: When shorts attempted to place sell orders at $105,000 to crash the price, the market makers of BlackRock’s iBIT ETF instantly absorbed all the sell orders, compressing the bid-ask spread to 0.01%.
2.2 Volatility Taming: The S&P 500 Component Stock Fund included Bitcoin in its hedging portfolio, suppressing its historically high volatility.
2.3 Technical Breakthrough: Whales accumulated 18,000 BTC in the 24 hours before the breakout, forming a golden cross technical pattern.
The Fear & Greed Index experienced a dramatic reversal: it soared from 39 (fear) to 73 (greed) within 48 hours. As 170,000 short accounts turned red on the on-chain liquidation monitoring map, a total of $572 million was wiped out. A hedge fund manager who had shorted MicroStrategy sighed bitterly, “We are not fighting cryptocurrencies; we are facing a flood of dollars through ETFs.”
3.East vs. West: The Hidden Geographical Battle
Amid this capital feast, regional competition quietly emerged. Data showed that the Asia-Pacific trading session accounted for 58% of the trading volume, but the capital flows were in sharp contrast:
Eastern Strategy: Chinese and Korean retail investors used Binance contracts with leverage up to 125 times to chase the volatility dividend of meme coins like Trump and MAGA.
Western Chess Game: BlackRock used ETF shares as collateral to sell put options on the Chicago Options Exchange, achieving a “zero-cost position.”
This division reflects a structural change in the market, and former decentralization believers discovered that the number of active Bitcoin addresses on-chain actually declined by 17% during the surge – ETFs were draining the soul of the spot market.
A new adage was circulating among Wall Street traders: “Buy the code, not the token; look at quarterly reports, not white papers.”
4.The Conspiracy Unveiled: Trump’s Bitcoin Strategy
Political power and capital have merged historically. The Trump family-controlled World Liberty Financial quietly amassed 32,000 Bitcoin through over-the-counter markets a week before the price broke through. Meanwhile, Trump’s social media plea, “Don’t sell a single Bitcoin!” – while seemingly a call to hold, was actually a move to squeeze liquidity.
An even deeper national strategy emerged. When the U.S. controls only about 200,000 Bitcoin (10% of the circulating supply), it urgently needs millions of reserves to control pricing power. A former White House economic adviser revealed the two-step internal strategy:
Short-term Squeeze: Use regulatory easing to attract counterparties, then use the ETF channel to trigger a short squeeze.
Long-term Hoarding: Through tax law adjustments, force institutions to hold Bitcoin long-term, with the goal of controlling 30% of the circulating supply.
Such moves target the dollar hegemony crisis directly. With $35 trillion in U.S. debt growing by $1 trillion every 100 days, the petrodollar system facing rebellion from Saudi Arabia, and gold reserves being repatriated by multiple countries, when Bitcoin’s market value breaks through the 10% critical point of gold, it officially becomes a new anchor point for the dollar system.
5.Hidden Dangers: The Ecological Mutations Behind the Frenzy
Beneath the capital feast, the cryptocurrency market is undergoing a genetic mutation. The total market value of stablecoins has dropped by 37% compared to its peak in 2024, and the trading volume share of CEX altcoins has hit a three-year low. The once-famous “altcoin season” transmission mechanism is now completely broken – when BlackRock CEO Larry Fink shouts a $700,000 target price, funds stay within the iBIT trust and no longer flow to the Uniswap or Solana ecosystems.
The collapse of the security line is even more alarming. In May, hackers stole assets worth $182 million, and North Korean hackers used “wrench attacks” to interrogate high-net-worth coin holders, plundering $5.2 million in a single raid. As Coinbase faces a $400 million claim for customer service corruption and data leaks, the decentralized ideal is powerless against centralized vulnerabilities.
6.The Endgame: The Domesticated Bitcoin and the Vanishing Crypto Spirit
Standing at the peak of $110,000, the white paper of Satoshi Nakamoto is fading in the vaults of Wall Street. As Bitcoin’s 30-day volatility rate drops to the level of traditional tech stocks and ETF holdings exceed miners’ reserves, a harsh reality is revealed: the financialization of Bitcoin is the subjugation by traditional capital.
The crypto world once chanted “banks are not trustworthy,” but now BlackRock has built a new power center with its $55.38 billion ETF management scale; blockchain claimed “resistance to censorship,” but now the GENIUS Act turns every stablecoin into a U.S. Treasury bond carrier. Capital never sleeps, but freedom needs to breathe. 》As $2.7 billion in ETF ammunition blasted open the door to $110,000, the ghost of Satoshi Nakamoto whispered in the blockchain rewards: is this the victory of Bitcoin or the ultimate pacification of the crypto uprising by Wall Street?