A study published on October 30 by Federal Reserve staff finds that Treasury dealers can continue financing customers’ bonds after largely clearing their own issuance inventories. Estimates covering eight large bank-affiliated dealers from January 2016 through June 2025 indicate that every dollar of coupon issuance expanded dealer balance sheets by about 21 cents, with roughly two-thirds attributable to client financing. The effect on inventories dissipates within about three days, while the increase in financing provided to clients remains measurable for the following week. SOFR ranged from 3.92% to 3.95% from October 23 through October 29 in conditions described as tranquil, but any connection to Bitcoin remains an unobserved hypothesis requiring evidence of tighter crypto credit and loan rollover terms.
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