Source: Talk Li Talk Outside

In the previous article (March 12th), we briefly discussed the future direction of the crypto market. Different people may have different ideas or views, and no one can really predict the future of the market, but one thing is certain, that is, although the market cycle has certain regularity, the market is also constantly evolving.

In fact, if we look back at some of our previous articles (such as articles during 2022 and 2023), some of the views we considered relatively reasonable or correct at the time may not be fully applicable today.

In this cycle, we have witnessed many changes or new unbelievable things, such as:

1) The MemeCoin Season seems to have replaced the previous Altcoin Season.

2) While Bitcoin reached the $100,000 milestone and broke new historical highs multiple times, the Altcoin king ETH did not even surpass its historical high in this bull market, and its current price is the same as 4 years ago.

3) The number of projects (tokens) has increased exponentially.

For example, in March 2021, the crypto market had a total of 350,000 tokens, while by March 2022 the market had 4 million tokens, and by March 2025 the total number of tokens had exceeded 40 million. At the current rate of development, it is estimated that by 2026 the number of tokens in the market may exceed 100 million. As shown in the figure below.

4) In 2024, the BTC ETF was finally officially approved, the ETH ETF was also approved, and currently, more ETFs such as DOGE, XRP, LTC, SOL, and ADA are applying for review (although the SEC has now delayed the approval of these Altcoin ETFs, considering the overall performance of the current market, the probability of approval in the second half of this year may be higher).

5) In 2025, the United States will include Bitcoin in the strategic reserve plan (executive order).

6) Institutions are actively accumulating Bitcoin and some Altcoins.

Although in the previous cycle, there were already large institutions like Grayscale in the market, and we have also experienced the participation of institutions like Tesla, and Musk has been continuously placing buy orders, but from this cycle, the participation of major institutions has become deeper and wider, such as the well-known MicroStrategy and BlackRock.

Of course, in addition to Bitcoin, some Altcoins have also begun to attract the attention and layout of some institutions, such as WLFI (World Liberty Financial, a DeFi project supported by the Trump family), which has been buying ETH, ONDO, MOVE, ENA, LINK, and AAVE tokens since this year (it is also possible that some tokens are sponsored). As shown in the figure below.

In short, we seem to be constantly following the existing historical cycle rules, while also witnessing some new and different or new historical events.

From an investment perspective, in this cycle, some veteran "cabbage" who have stuck to their traditional investment mindset have also suffered losses, especially those who have insisted on focusing their investment on Altcoin value investment strategies. A few days ago, I saw a fairly representative report that said a certain whale had built a position in PENDLE eight months ago, but seemed to have given up and liquidated the position this month. As shown in the figure below.

Of course, compared to the decisiveness of the above-mentioned guy, currently many veteran "cabbages" may still insist on holding their Altcoins that have already fallen by more than 80% and not let go, leaving themselves in a dilemma, such as not wanting to take the loss directly, but also feeling unable to break even by switching to Bitcoin... In fact, anyone facing such an outcome would find it very difficult to make a choice or let go, and as for what to do, in our article on March 11th, we have already given some thoughts and suggestions from a long-term and short-term perspective, interested friends can go back and review the corresponding article, and I won't repeat it here.

Here, let's set aside the macroeconomic factors and just look at the crypto market itself. From the current overall market environment, it seems that people (including institutions) are focusing on Bitcoin (those who have been hurt or not hurt in this cycle have basically all turned to focus on Bitcoin in the long run), which will make it difficult for Bitcoin to experience another violent "rise" again, because sometimes excessive attention can create a certain pressure, and the accumulation of this "pressure" may make it difficult for Bitcoin's dominance to decline (it may even continue to rise), and will prompt more people to start turning to Bitcoin (more and more people are now starting to believe that investing in Bitcoin will be better than investing in other Altcoins), and when Bitcoin experiences a correction, there will be more and more people actively stepping in to buy the dip...

With the new changes and new operating models mentioned above, it seems that we will find it difficult to see the traditional Altcoin Season again (i.e., after Bitcoin reaches a certain historical high, its dominance will begin to decline, and then we will see a scenario of all Altcoins soaring). From this cycle, the so-called Altcoin Season has been replaced by the phased MemeCoin Season, Trump Season, AI Season and other sectoral Altcoin Seasons (or we can call them mini Altcoin Seasons) that rise and fall quickly.

So, can we still see the traditional "all coins soaring" Altcoin Season? I think this kind of comprehensive Altcoin Season will be very difficult, you can't make 10 million tokens all collectively surge several times, dozens of times at the same time!

Unless there is a fundamental change in liquidity, i.e., a massive influx of new money into the crypto market to support the logic of all Altcoins being able to surge together.

But the mini Altcoin Seasons will still appear, it's just a matter of time. If you are still interested in Altcoins and don't want to spend too much time and energy on project research or participate in PvP games, you can just focus on digging out those projects with strong fundamentals, such as projects that can generate sustainable income, have good token economics, and can continue to build and have development vision... The simplest way is to just select from the top 100 by market cap.

It can be foreseen that in the coming period, liquidity will still be mainly concentrated on BTC and a few Altcoins, and the liquidity of most Altcoins may face insufficient or continuous decline, the massive Altcoins (plus the endless VC projects unlocking tokens) will make the liquidity more dispersed, and this fundamental problem can only be patiently waiting for internal innovation (i.e., innovation within the crypto market, but I don't see it for now) and changes in macroeconomic factors (such as the expected rate cut in June this year, and new policies for the crypto industry in the US this year) to alleviate to a certain extent.

I often hear people say this sentence: History does not repeat itself, but it often rhymes.

We need to understand this sentence reasonably. The so-called "rhyming" does not mean that we can just stick to the past and refuse to change. As mentioned at the beginning of this article, although the market cycle has certain regularity, the market is also constantly evolving, and some scenarios that were applicable in the previous cycle may no longer be fully applicable in the current one. We need to keep up with the times and constantly adapt to and study the new scenarios of the current cycle.

At the current stage, people's views are quite divided, with some believing that the market has already started a bear market, some believing that this is just a technical correction (the biggest bull run is yet to come), and some believing that the bull market has just begun. As for my personal opinion, I have already shared it in the previous series of articles. I think there may still be some new opportunities this year (but not on a large scale), but I can't see too far into the future, so let's just focus on the possible situation in May-June this year.

Moreover, everyone has a different definition of bull and bear markets. Some believe that as long as the price breaks below the MA200, it is a bear market, while others believe that it is a bear market only when drops below $50,000... Let's just forget about bull and bear markets, as we mentioned in our previous article. We only need to focus on and identify a few important stages (such as accumulation - rise - decline - despair - rise - decline - despair - re-accumulation). It's not that you will lose money in a bear market and make money in a bull market. In fact, no matter whether it is a so-called bull market or bear market, as long as the market is still there and there is still liquidity, there are opportunities. We need to go with the trend, but also go against the trend.

Let's talk about these today. The sources of the pictures/data mentioned in the main text have been supplemented in the Notion of the talk. The above content is just my personal perspective and analysis, and is only for learning and exchange, and does not constitute any investment advice.