Editor's Note: The author reviews the birth of PumpFun, the differences between the Bitcoin halving, 2021 and the current scams, and how to adapt to the new market cycle. The author reminds investors to be aware of limited liquidity in the current market environment, have a clear sell strategy, and closely follow the narratives in the market rotation to avoid excessive FOMO. At the same time, always keep some profits in stablecoins and continue to accumulate long-term quality assets like BTC.

The following is the original content (the original content has been edited for easier reading):

This cycle is very difficult, worse than any previous cycle. Many even call it the "crime cycle" due to the growing number of "rug pulls" and Altcoin projects.

The purpose of this article is to look back on the past and try to predict what our fellow small partners who just want to succeed will face next.

The Birth of PumpFun

On January 19, 2024, PumpFun was born, forever changing the face of meme coins. Everyone was given the opportunity to launch a token, regardless of their age, occupation or nationality.

The hype was not high at the time, but PumpFun gradually gained momentum in March 2024, with the first projects being $MICHI and $FWOG. Anyone could launch a meme coin in a few seconds, a phenomenon that changed the entire market.

As more and more tokens appeared, PumpFun became a fair issuance platform, with no insider rug pulls. Although it looked very attractive, the withdrawal fees were huge.

Since its launch, PumpFun has earned over $2.86 million in $SOL, equivalent to $577 million. It may be one of the most successful startups ever.

This liquidity was permanently extracted and pocketed by the PumpFun developers. But I think this is an important reason that sets this cycle apart. We'll explore this further later.

The Bitcoin Halving

Next is an important moment in the current cycle. On April 20, 2024, the Bitcoin mining reward was halved from 6.25 BTC to 3.125 BTC. On January 10, 2024, when the first ETF was approved, many thought it might be a "sell the news" event, but we actually saw new ATHs.

ETF + Halving is the strongest bullish combination for BTC, as many have been waiting for institutional liquidity to start flowing into the market. And that's exactly what happened. Fidelity, BlackRock and MicroStrategy have been buying daily, constantly injecting liquidity into the market.

This gave people hope. They thought this bull run would be similar to the previous ones, but this time, everything was different.

The market is always fighting the masses, meaning that if retail is bullish, the market is likely to fall, and vice versa. Perhaps that's what's happening here, and we're about to find out.

Your Expectations Are the Problem

Looking back at the 2017 and 2021 cycles, the situations were very similar. Making money was not difficult and did not require any special knowledge. At the time, there were 10-20 well-known mainstream coins that everyone was constantly accumulating.

First, BTC would rise, then ETH would follow, as the cycle's Beta plays, usually with higher returns, then we would move from ETH to other mainstream coins and then to some small-cap coins.

This is also why many people in 2024 decided to skip the BTC stage and invest directly in ETH or other Altcoins, the logic is simple. If ETH can 5x, and larger Altcoins can 10x, why wait for 2-3x returns on BTC?

This logic is very straightforward, however, the "masses" did not consider that this cycle may be different. The number of projects, tokens, and meme coins is 100 times that of the past, and everyone rushed to buy familiar tokens like $DOT, $ATOM, $ADA, waiting for the promised 10x returns.

As a result, when liquidity started flowing into Altcoins, the sheer number of new projects actually left the old projects behind.

2021 Scams vs. Now

I just saw @Overdose_AI raise an effective point, so I decided to include it here. Going back to 2021, the "rug pull" scammers were quite creative, and as long as they weren't too greedy, they almost let everyone jump ship.

· Terra $LUNA was controlled by Do Kwon

· FTX was controlled by Sam Fried

· 3AC invested for a long time before the collapse

· Alameda pushed different narratives and manipulated the market

Scams were relatively difficult back then, requiring a certain level of intelligence. But now, people are just using big names, celebrities, and even rulers of major countries to promote their junk projects.

People have gotten used to gambling, FOMO-ing into $TRUMP and $MELANIA, deciding to make up for their losses through $CAR or $LIBRA, only to end up losing all their money.

I know 10 to 15 great traders who used to DCA into $LIBRA, waiting for the opportunity to buy the dip, while insiders made over $100 million off them.

It's Time to Adapt

It's time to understand that cycles will never be exactly the same, and Altcoins are not just the Beta of BTC or ETH, they are a completely different niche market, bringing more risks and more opportunities.

You can't just keep going long $DOT or $ATOM just because BTC has hit a new high, as that was effective in 2021.

Don't get me wrong, I'm still bullish on BTC and believe it will still be one of the best compounding assets over the next 10 to 20 years, but the returns will be more stock-like, no longer the easy 200% annual growth.

Conclusions to Remember in This Cycle

1. Holding and waiting for the price to rise is a fool's errand, if you don't sell at the right time, you're done. @MustStopMurad has been telling you to hold, and almost all of his meme coins have dropped 80%-90% from their ATHs.

2. You need to have a clear sell strategy. I know this may sound harsh, but that's how the market is, you have to determine when to exit before making a trade.

3. Rotate the narratives, we've recently experienced crazy market rotations from meme coins to AI Agents, to $TRUMP and so on. If you didn't keep up at any point, you can almost guarantee that most of your gains will be wiped out. Always follow the market narrative and remember that liquidity is limited.

4. "Timely" is always better than "early". Don't overthink it, find the right entry point, but don't be too anxious to wait.

5. Always convert a portion of your profits into stablecoins, no matter how much you believe in a protocol, continue to accumulate BTC, which is still better than most stock or real estate opportunities.

Honestly, I don't know if we're going to go down or up next, I'm positioned on both sides. If the market goes down, I'll continue to buy more BTC and $ETH.

If the market goes up, I have enough Altcoins to avoid FOMO, and I know I can profit from trading and help my followers.

I hope this cycle is not over yet, the current BTC consolidation will determine our direction for the next 2-3 months.