BTC Liquidity State Machine Daily — October 11, 2026. The full, verified public report is in Chinese at https://argusx.fun/research/liquidity/2026-10-11/daily/ . This English section is a summary, not a full translation.

State: S1 TRANSITION, 78% qualitative confidence. Q is supportive thanks to lower Treasury cash balances and higher bank reserves. P remains tightening because real yields and long-end funding costs are high. g remains under pressure: Friday's modest BTC ETF inflow did not reverse the week's outflows, while stablecoin supply contracted. F has stabilized as weekend liquidation pressure eased. No S2 confirmation; no proof of sustained S3 liquidation cascade.

Verified observations: Bank reserves 3.029659 trillion USD (weekly average to Oct 7). Treasury General Account 0.880253 trillion USD (weekly average to Oct 7). 2-year US Treasury yield 4.80% (Oct 9). 10-year US Treasury yield 5.24% (Oct 9). 30-year US Treasury yield 5.60% (Oct 9). 10-year US real yield 2.91% (Oct 9). US spot BTC ETF inflow 0.211 hundred million USD (Oct 9). Total stablecoin supply 3058.8 hundred million USD (Oct 11 snapshot), 7-day change -0.30%.

Expected vs Actual: Once forced selling ends, price should stabilize even with weak inflows. This seems broadly consistent with the evidence, but low weekend liquidity prevents declaring a positive structural residual. Feedback Gain: STABLE. Policy reaction pressure: APPROACHING, constrained by inflation. Invalidation: sustained net inflows and healthy low-leverage strength would support S2; resumed fiscal liquidity drain and outflows would weigh toward S0; persistent forced liquidation with worsening flows or funding conditions would warrant S3 assessment.

Treasury tenor correction (2026-10-12): the Oct9 3Y yield4.89% was mislabeled as2Y. Correct readings: 2Y4.80%, 3Y4.89%, 10Y5.24%, 30Y5.60%; 10Y–2Y44bp. P evidence and the2Y observation are corrected; the remaining original research is preserved.

## Public sources

- [Federal Reserve H.4.1, October 8 2026](https://www.federalreserve.gov/releases/h41/current/)
- [US Treasury Daily Par Yield Curve Rates, October 9 2026](https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?type=daily_treasury_yield_curve&field_tdr_date_value=2026)
- [US Treasury Daily Real Yield Curve Rates, October 9 2026](https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?type=daily_treasury_real_yield_curve&field_tdr_date_value=2026)
- [Farside US Bitcoin ETF Flows](https://farside.co.uk/btc/)
- [DefiLlama Total Stablecoin Supply](https://defillama.com/stablecoins)
- [CoinGlass BTC Futures Spot Liquidation Snapshot](https://www.coinglass.com/currencies/BTC)
- [New York Fed SOFR reference rate](https://www.newyorkfed.org/markets/reference-rates/sofr)
- [October 2026 SOFR historical daily table](https://www.sofrrate.com/sofr-rate/2026-10)
- [Reuters October 9 2026 bond market risk analysis](https://www.reuters.com/business/four-signs-it-is-about-get-uglier-bond-market-2026-10-09/)