The market has been up and down recently, and a large correction of tens of thousands of dollars has occurred twice. The leeks have lost the ability to judge the bull and bear markets.
Some people say that if we hold on, there will be a bull market soon because the Federal Reserve is about to surrender and flood the market with money, a huge amount of liquidity is about to pour in, and Bitcoin is about to break a new high.
Some people also say, look at Mao, a bear market is coming soon. The three waves have already been completed. After the Fed cuts interest rates, the U.S. stock market will still fall. If the U.S. stock market falls, the cryptocurrency market will fall. The bull market is over.
Anyway, there are eight hundred directions in a day, and no one can convince anyone else.
But quietly, the dog houses have achieved their goal.
The leeks started buying Bitcoin at around 60,000.
In other words, people are starting to accept Bitcoin that costs around $60,000.
Ju Zuo still remembers that during the last bull market, the holding costs of a small number of institutions were between 20,000 and 30,000, while the holding costs of most institutions were around 40,000 US dollars.
So there was a popular saying at that time: 40,000 is the bottom line of Bitcoin.
But with the arrival of another bear market, when Bitcoin fell below 20,000 or even 16,000, this statement disappeared along with the market.
But they seem to have overlooked a simple truth:
You can buy 40,000 bitcoins, but you can’t buy 20,000 bitcoins?
Many people are not even as good as Ah Q in this regard. They all know a truth:
The monk can touch it, but I can’t?
But now, there seems to be no such voice, especially in this wave of wide fluctuations, the market seems to have defaulted on the grid strategy:
That is, as long as I buy at a relatively low price and then sell after a rebound, I can make a profit.
Although the price of Bitcoin is weakening overall, the reality is that the cost for holders is getting higher and higher.
Wu said that he sent a message these two days, saying that the cost of Bitcoin mining is now close to 52,000.
In other words, under the current market conditions, the premium for miners is not that high.
So far, the most popular miners are those who held on to the coins in previous years and those who used low-cost mining machines in the early years.
With the current mining costs as a hard bottom line, and the arbitrage space caused by market fluctuations, those who previously complained that Bitcoin was too expensive may begin to accept the rationality of this statement.
Whether based on subjective cognition or objective facts, we may have entered a special cycle of high bear market and low liquidity.
Ju Zuo took a look at the CMC data and almost scared me to death.
Currently, the market value of Bitcoin basically accounts for half of the total market value, about 1 trillion US dollars, but in most cases Bitcoin is not used for sale.
Of the 24-hour trading volume of US$35 billion, stablecoin transactions accounted for more than 90%.
Looking at the market value of stablecoins, it has exceeded 1 trillion yuan, or about 180 billion US dollars.
Judging from the transaction amount of stablecoins, its trading volume is also shrinking.
Then all the remaining currencies added together make up a market value of $1 trillion.
Let’s take a look at these sets of data, and you will understand why Ju Zuo says that we are in a special cycle of high bear market and low liquidity.
The current global cryptocurrency market value is 2 trillion US dollars, and the market value of Bitcoin is 1 trillion US dollars.
The trading volume in the past 24 hours was only $35 billion, of which $31 billion was stablecoins.
The combined market capitalization of all stablecoins currently ranks third among cryptocurrencies, approaching $180 billion.
Because almost all mainstream trading currency pairs are U-coin pairs. If liquidity is concentrated in stablecoins, you can understand that the market risk aversion is relatively high, and currency holders are unwilling to put their assets in non-stable currencies, which causes liquidity to shrink.
So the reason you see the current market weakness is precisely due to this.
I dug deeper into CMC's data and found three more frustrating realities:
First, in all cryptocurrency transactions, the proportion of stablecoins has always been very high, exceeding 50% for a long time.
The following figure shows the total transaction volume in the past 7 days. The peak was 105b, but after removing USDT, only 59b remained.
Friends who are interested can adjust the data by themselves. Whether you use the monthly line or indicators in other dimensions, it is basically like this - stablecoins account for about 50% of all transactions.
Second, even though the proportion of stablecoin transactions is already so high, the overall transaction volume is still declining, especially in recent times.
Looking at August alone, the daily trading volume was able to remain above 150b except at the beginning of the month. After the 10th, it could only fluctuate around 50b, or below the daily trading volume of US$50 billion. Now it has fallen to a new monthly low of only 35b.
And there is no hope of a rebound in this trend for the time being.
Third, the share of stablecoins in the overall cryptocurrency market capitalization is increasing and will only increase in the future.
The logic is also very simple, I can explain it clearly by asking you a question:
Do you think Bitcoin will go higher and higher in the future?
I believe that most people would give a positive answer.
Then it is easy to say, the principle of issuing stablecoins is:
When the price of Bitcoin rises, the demand for stablecoins will increase. Therefore, in order to maintain the balance between Bitcoin and stablecoins and prevent the deflation of stablecoins from directly driving the surge in Bitcoin prices, the only way to maintain this balance is to increase the issuance of stablecoins.
In the past, we could see Tether destroying USDT, but in recent years they have only taken one action:
Issue more, issue more, and issue more along with Bitcoin.
So in the future, the overall share of stablecoins will only grow.
Ju Zuo is not good at cryptocurrency trading, but he is good at talking, especially about macro and data.
Some time ago, Juzuo also analyzed the problems of Ethereum from the perspective of data: Ethereum Gas fell below 1GWei, is a big one coming?
Now you have all seen the performance of the currency price and everyone’s crusade against Vitalik, even the name has changed from V God to V Dog.
At present, Juzuo can at most discover some problems, but is far from having the ability to solve them.
You ask me if I am a bull or a bear? Sorry, I don’t know the answer either.
Because I am only human.
