The recent cryptocurrency market is quite depressed, with altcoins falling over the past three months and Bitcoin stagnating. I expect this downturn to continue throughout the summer until August, when the market may recover with the launch of the Ethereum ETF, preparations for the presidential election, and potential interest rate cuts. However, this is just my personal opinion and is for reference only.

My activity has been relatively limited lately. Aside from holding ETH, some yield farming via Pendle and Gearbox, and numerous angel deals, I haven't been involved in much else, to be honest. Trading has become extremely difficult, with almost every airdropped project in the market selling off, with very few exceptions, such as ENA which is up about 50% since the TGE. We are in a completely new market environment. I have discussed the issue of low circulation, high FDV tokens in several previous briefings.

Compared to 2021 and 2022, the tokens launched in the past year saw almost no price action after the TGE, which is no longer the case. As Cobie explains in his latest Substack article, the price action for these tokens actually occurred in the private phase. Therefore, unless you are a project founder, venture capitalist, angel investor, trader with inside connections, or KOL, you will find this bull run extremely difficult. Of course, there are some exceptions, such as October 2023 to March 2024, which was a good period overall, and if you participated in some emerging meme coins early, you can also get benefits. But other than that, most people will probably agree that this is one of the toughest bull runs they have experienced.

Interestingly, even veteran OGs seem to fail to capitalize on their strengths. Take Hsaka, for example. Even though he is a key player in the market, we seem to only see him when the market is easy to operate. Ansem is in a similar situation and seems to be a bit lost. However, should we really blame him? At the end of the day, we are responsible for what we buy, when we sell, and what trades we make. Although KOLs can create FOMO, at the end of the day, it is still us who decide how to manage our funds.

I spent much of 2023 and early 2024 immersed in various trading interfaces, whether it was the PvP terminal, Tweetdeck/X Pro, or the alpha chat group on Telegram. Recently, however, I have taken a more relaxed attitude towards the market. This is mainly because other trading directions seem to be unsustainable except for short-term trading (the rumor about ETH ETF a few weeks ago is an exception). This situation reminds me of the post-Terra collapse in May 2022, when the market was silent and we had to return to real life. Although I see some similarities with that time, I still think that DeFi is ushering in a new renaissance.

While I look forward to the return of traditional DeFi, Farming points and airdrop hunting seem to have evolved into the new form of DeFi. For example, the Ethena project allows you to lock USDe for three months in advance and then receive returns in the subsequent airdrop. Few people at the time foresaw that Ethena would quickly become so popular. I wish I had better grasped such opportunities at the time, and there is a new stablecoin protocol called Usual that brings me similar expectations. They are currently operating in the private phase and also offer a high APR. The key point is whether they can grasp the market timing as accurately as Ethena (their airdrop is scheduled for October).

Stablecoins

I still believe that this is the most critical and practical use case in the cryptocurrency space. It provides the possibility to store funds in personal wallets without being restricted by the network and send funds to any corner of the world in an instant. At present, some stablecoins with yields have appeared on the market, such as Ethena, Open Eden, Usual, etc. Although the stability and reliability of the yields of these stablecoins are still to be discussed, we have clearly surpassed the UST period of Terra. Take Open Eden as an example, it is a stablecoin protocol backed by treasury bonds, which can bring an annualized net return of about 5%. Recall that at the peak of the last bull market, Terra UST had a market value of 20 billion US dollars, while Ethena’s current market value is only 3 billion US dollars. I am very excited to see how big these stablecoins will grow, or whether there are other protocols that can challenge their position.

I have a dream that after this bull market ends (and maybe at the bottom of the next bear market), we will have a stablecoin that is as safe as USDT/USDC and provides at least 5% sustainable returns. This market undoubtedly has huge potential, just think about Wall Street and the bonds those investors hold. The first step is to ensure the absolute security of this stablecoin, and hopefully we can get the support of financial giants like Larry Fink and Blackrock.

In this bull run, I am looking forward to EigenLayer, Pendle, Gearbox, Hivemapper, and sports betting and prediction market protocols. I miss the high-yield mining projects in the last bull run, such as TOMB on the Fantom chain, which is full of speculation and high risk. Although there are still some similar speculative projects in the market, their TVL is not high and their popularity is limited.