Author: Stephen McBride

Compiled by: Bai Hua Blockchain

Source: TradingView

1. The crypto market is at a critical turning point

Bit (BTC) has stagnated after breaking through $100,000, and many small cryptocurrencies have given back their post-election gains.

However, we are about to witness an unprecedented change in the history of cryptocurrencies - government support, which is what the market has long been craving.

Relevant research shows that this will be a powerful catalyst for a new round of cryptocurrency price increases, and may even break the long-standing four-year cycle.

The U-turn in Washington's attitude has transformed cryptocurrencies from "de facto illegal" to "a national priority development project". In the past month, we have witnessed an almost countless number of positive regulatory changes:

• Trump signed an executive order laying the foundation for a supportive regulatory environment for cryptocurrencies, ending "Operation Choke Point 2.0" and ensuring that cryptocurrency companies have access to banking services.
• The U.S. Securities and Exchange Commission (SEC) announced the establishment of a dedicated task force to develop new regulatory rules to clarify which Tokens are securities and which are commodities.
• The SEC has repealed SAB 121, a vague rule that has made it almost impossible for banks to custody cryptocurrencies for clients.
• The Commodity Futures Trading Commission (CFTC) will be led by crypto supporter Brian Quintenz, which will further promote a regulatory environment favorable to the industry.
• Congress is expected to pass a stablecoin bill this year, providing a legal framework for the stablecoin market.
• David Sacks, Trump's crypto policy chief, said the government wants to make the U.S. the "global capital of cryptocurrencies".
• A Texas judge overturned sanctions on the privacy protocol Tornado Cash, marking a major shift in regulators' attitude towards innovation.

The number of positive regulatory changes is countless, and the policy shift in just the past month alone could fill several pages!

2. Regulatory clarity is the green light for Wall Street

The world's largest pool of capital can finally make a big push into the crypto market.

For example, last month, when asked if Bank of America would enter the crypto business, CEO Brian Moynihan responded: "If the regulatory framework is in place to make it a truly legitimate business area, you'll see the entire banking system jump in."

Now, Wall Street can invest with confidence, entrepreneurs can build with confidence, and as investors, we can seize the opportunities in this major transformation and continue to hold the highest quality crypto assets.

Most investors don't realize how severely the regulatory storm of the past few years has impacted the crypto market. And now they underestimate the far-reaching impact of this policy shift on the future of the crypto market.

The U.S. government is shifting from an anti-crypto stance to a supportive one. In the past four years, every time crypto regulation was discussed, it was bad news - "Oh great, another three-letter agency is suing some protocol." Now, the situation has completely reversed.

The most important catalyst in crypto history is about to arrive just as market sentiment hits multi-year lows. The MEME Token craze is about to subside, and real crypto innovation in the U.S. is about to flourish. And with the regulatory gates open, Wall Street's titans will soon enter this new frontier.

3. Capital flows are the key reason why Bit (BTC) is still leading this bull market

Since BlackRock launched the iShares Bit (BTC) Trust ETF (IBIT), this ETF has attracted $40 billion in capital in just one year.

In contrast, small cryptocurrencies lack this kind of capital support, and their market performance is almost entirely dependent on sporadic retail buying, with most investors only buying a few hundred dollars' worth of tokens.

In recent years, due to regulatory resistance, the crypto funds that once dominated the market have struggled to raise new capital, leading to a lack of investor interest in even fundamentally strong small cryptocurrencies. But as the regulatory environment becomes clearer, this is changing.

To my knowledge, dozens of crypto funds are actively raising capital, with the goal of completing fundraising this quarter. This means that the market could see a new wave of capital inflows by early summer this year.

I also believe that regulatory clarity could break the traditional four-year cycle - and in a positive direction.

Since the crypto market bottomed out at the end of 2022, Bit (BTC) has been the market leader.

Based on the past four-year cycle, capital should have started flowing into small Tokens at this stage, but this time they are still waiting for their opportunity.

Typically, the market would see a deep correction in 2026, but Washington's policy U-turn on cryptocurrencies could extend this cycle for longer.

ETFs have already brought hundreds of billions of dollars in new capital to the crypto market, and the policy shift in Washington could bring "trillions" in capital inflows.

Our research shows that the actual progress of the current market cycle is ahead of the calendar timeline.

By 2025, the price of Bit (BTC) could soar to $250,000.

However, most investors are still looking back, haunted by the shadow of years of regulatory storms, and have not yet realized that the U.S. is about to become the global center of crypto innovation!

4. With the changing regulatory environment, truly valuable crypto projects are about to experience explosive growth

In recent years, due to regulatory bottlenecks, a large amount of capital has been blocked from the crypto market, preventing most projects from having a real chance to develop. Now, the situation is changing.

While 99% of cryptocurrencies still lack long-term value... that 1% of high-quality projects are solving real-world problems in innovative ways and are already profitable.

I've just done an in-depth study and found three innovative crypto projects with potential:

• One is challenging the industry's dominant position over Google.
• Another has built an "AI chip version of Airbnb".
• The third has already established partnerships with well-known brands like Disney, Netflix, HBO, Apple, and Nike.

The regulatory gates have opened, and the real value investment opportunities are here!