Summary of this article:
At the moment of writing this article, in Q4 2024, this is the early stage of a new round of the crypto bull market.
The value of Bitcoin is in the overall economic industry, analogous to bonds and stocks in financial history; it is the 'fuel' for a new round of human technological development. In the mid-level industry, it is the currency entering the digital world that humanity will inevitably enter, and also an index; in the micro-level industry, it represents the new round of legal regulations coming into effect, token compliance, thereby siphoning the global demand for private investment.
This may be the last 'grassroots' cycle belonging to the crypto industry, as well as the last mega cycle for Bitcoin with huge beta increases. This means that after this cycle, Bitcoin's beta will significantly decrease, but it does not mean that there will be no hundredfold alpha opportunities in the broader token issuance market.
The peak of this round of Bitcoin's bull market will occur in Q4 2025, with a high point of 160,000 to 220,000 USD. Before that, excluding the 'first wave' that has already occurred, there are still two significant mid-term bullish trends.
We are currently in the year 1999 of the internet age, which means that after the bull market peaks in the next 12-18 months, the crypto industry will face a long winter, similar to the bursting of the internet bubble in 2000-2001. Of course, this is also an opportunity for industry reshuffling and reorganization. I am looking forward to it.
When I feel the bull market is coming, it is also when the article outputs the most.
About four years ago, at the dawn of the last bull market cycle, I wrote (How Should We Invest in Digital Currency in 2021?). When we talk about the entire digital currency industry, we inevitably need to mention the value and price of Bitcoin first.
If you already believe in the value of Bitcoin, feel free to skip to part five for expectations on the future price trend of Bitcoin.
One
From the perspective of industry, I want to discuss Bitcoin's value in terms of the overall economy, mid-level, and micro levels. From the overall economy, Bitcoin represents the hedging expectations of the entire financial market of humanity and serves as the third capitalizable 'financial medium' following bonds and stocks in human history; from a mid-level perspective, Bitcoin is the best 'index' for the output value of the 'digital age' or Web3 world that humanity will inevitably enter; from a micro-level perspective, Bitcoin is gradually becoming compliant with regulatory standards, thereby attracting a large amount of 'traditional old money' in mainstream countries like the U.S. In third-world countries, it siphons off unmet private investment demand.
Image source: ForesightNews
From the perspective of the overall economy, if we regard Bitcoin as a groundbreaking asset in human financial history, then the most important thing is to understand the changes in financial history. (In (How Should We Invest in Digital Currency in 2021? Part One of Four), the position of digital currency is established from the perspective of technological history. Behind every technological revolution, important financial infrastructures and entirely new financial 'mediums' are created.
Image source: ForesightNews
Behind finance lies the changing times. At this moment, we may be at the most confusing time in the global political and economic situation in the past 30 years, and also the moment when the traditional financial order is most fragile and likely to undergo a major reshuffle. I can no longer trace whether similar financial venues to the London Stock Exchange or New York Stock Exchange existed when famous financial bubbles like 'Dutch Tulip' appeared hundreds of years ago, or whether Dutch vendors were accustomed to offline transactions and only speculated without establishing rules and order, causing the bubble to ultimately burst. However, throughout history, every technological innovation that has been remembered by humanity has been accompanied by changes in financial paradigms, and these changes are an inevitable product of shifts in the times. These causative relations both affect and complement each other, ultimately writing a significant chapter in human history. I also cannot predict whether, without the Civil War bringing dramatic changes to American social structures, which reshaped social classes and encouraged technological innovation to enter the real economy, the second industrial revolution would have still begun in Britain and ultimately flourished in the U.S., becoming a milestone.
At the same time, I have a more radical view: when everyone talks about economic stagnation and how to find viable business models — does business itself need a business model? Has the term 'business model' itself lost its meaning?
Here are more of my thoughts, somewhat complicated, and I will not elaborate further here; it will be explored as the most important part in my future article (The Four-Part Series on Crypto Capital - Side Story: Philosophical Musings on Business and Investment).
Related reading: (The Four-Part Series on Crypto Capital Part One: Token Issuance, A New Financing Paradigm)
In the current value of 'social capital' (or expressed as 'private economy'), equity enterprises may account for 95%, while public companies that use stocks as value anchors account for a large portion of capital value. However, in the future, this value may exist more in 'businesses' (why can't limited partnerships?) and 'tokens' (foundations).
Two
Let's spend some time discussing the mid-level industry perspective on Bitcoin. At the end of the book I wrote in 2021, the first point among the eight predictions mentioned that Bitcoin is unbeatable. Refer to the electronic version of my book (Unlocking the New Password - From Blockchain to Digital Currency) for the postscript.
Image source: ForesightNews
From the perspective of the technology industry, Web3 is an inevitable trend in the future, and Bitcoin is the core asset of the entire Web3 world, or in economic terms, should be called 'currency.' In ancient times, when barter was common, gold was the most common 'currency.' After the development of modern nation-states and financial systems, national currencies became the most common 'currency.' In the future, with the advent of the digital age, a new 'currency' will be needed for all life in the digital world within the metaverse.
Therefore, it is meaningless for some people to cling to 'why are you investing in a token.' Blockchain and crypto need a 'plus,' just like when others ask you what track you are investing in, you say 'I want to invest in equity enterprises' or 'I want to invest in an internet enterprise.' As a special industry, Web3, with crypto as a new market method and financial medium, is gradually combining with other industries — blockchain + AI = DeAI, blockchain + finance = DeFi, blockchain + entertainment/art = NFT + metaverse, blockchain + research = DeSci, blockchain + physical infrastructure = DePin...
The trend is clear, but what does it have to do with us? Or rather, how can we gain wealth appreciation after seeing the trend clearly?
Now, let's shift our focus to AI.
In recent years, the main theme of the business world has been twofold: one is explicit, and the other is implicit. AI is undoubtedly a hot topic that capital has continuously pursued and is presentable. Crypto, on the other hand, is brewing in the shadows, a place where various legends and myths of wealth are concentrated, but it is also limited in various ways, making it an unattainable realm for many.
The potential of the AI market is indeed widely regarded as trillion-level, especially in generative AI, AI chips, and related infrastructure industries. However, for investors, while everyone believes AI is a sunrise industry and is willing to invest their money, what should they invest in? Is there now an AI ETF index fund that comprehensively covers the AI ecosystem to effectively track industry growth?
No. In 2024, Nvidia's stock price rose nearly threefold, while most AI-themed ETFs performed rather mediocre during the same period. Looking ahead, Nvidia's stock performance will not necessarily show a positive correlation with the overall growth of the AI sector — the chip company will never be solely represented by Nvidia.
Image source: ForesightNews Comparison of mainstream AI ETFs and Nvidia stock performance in 2024
AI is the main theme; however, will there be a product that can anchor the future market value development of the AI industry, where the entire industry's output value rises according to the value of this ETF? Just as the Dow Jones Index / S&P 500 ETF represents the development of Web0 (equity enterprises), the Nasdaq ETF represents Web1. The investment opportunities of Web2 are not presented in index form; the most suitable index for the value of the Web3 world, or the entire digital world of humanity in the future, is Bitcoin.
Why must the value of the Web3 world be measured in Bitcoin?
Because, since the birth of computers and the internet, humanity is destined to spend more and more time in the virtual world rather than the real world. In the future, when we wear VR/AR glasses, we can sit at home and visit Yellowstone National Park, experience the palaces of China's Tang Dynasty, and enter a virtual conference room you set up to have coffee face-to-face with friends on the other side of the globe... The boundaries between reality and virtuality will become increasingly blurred; this is what the future digital world, or the metaverse, will look like. In that space, if you want to decorate the virtual space or have digital beings dance for you, you will need to pay - this cannot be in dollars or RMB, let alone physical assets. The most suitable and only currency that can be accepted by the entire digital world is Bitcoin.
I remember in the movie (The Xinhai Revolution), Sun Yat-sen held a 10 yuan bond: 'Upon the success of the revolution, this bond can be exchanged for 100 yuan.'
Image source: ForesightNews
Three
Back to the present.
We live in economically stable countries, where fiat currency can be trusted. But this does not mean that the entire world's financial systems are as stable as the society we live in: the first thing Argentina's new president announced upon taking office was to cancel Argentina's fiat currency system — after all, no one in Argentina trusts the fiat currency issued by the government, so why bother? Turkey's inflation rate reached +127% in 2023, and correspondingly, the digital currency ownership rate among its citizens is as high as 52%. Especially in third-world countries, in recent years, as information technology infrastructure has gradually improved, traditional fiat currency mobile payments and digital currency payment methods have developed almost simultaneously. In contrast, like during China's information technology boom around 2010, which skipped the POS machine and bank card payment 1.0 era and directly entered the mobile payment 2.0 era, third-world countries have recently started developing, with the digital currency payment of the 3.0 era directly replacing the mobile payment methods of the 2.0 era, making digital currency payments a common scene in daily transactions.
Here, an interesting debate arises: Bitcoin has no controller. If it cannot fulfill the macroeconomic regulatory functions of fiat currency as a currency or 'currency,' then the U.S. dollar is also issued by enterprises. Therefore, the so-called macroeconomic regulation must yield to the interest groups behind it; capital power is the driving force behind the world’s operations. If fiat currency is to be said to have macroeconomic regulation, then the mining interest groups of Bitcoin are the largest regulators.
Image source: ForesightNews Changes in inflation rates of major economies in recent years
Image source: ForesightNews Changes in Argentina's inflation rate in recent years
From a micro perspective, as the speed of capital flow accelerates, the technological and financial cycles are becoming shorter and shorter. In an environment with weaker economic anti-fragility, the traditional equity market requires an 8-10 year lock-up period. This long-term investment characteristic raises concerns about liquidity for many. Token rights provide the possibility of early monetization, which not only attracts more retail capital but also offers early investors more flexible exit expectations.
In the traditional equity market, angel rounds or early investors typically seek partial exit through equity transfer or corporate buybacks around five years after the establishment of the enterprise, when it has entered a relatively mature development stage but is still some time away from an IPO or acquisition (usually 8-10 years). This model can effectively alleviate the time cost of investment, but compared to token rights, its liquidity is clearly more restricted.
The attraction of the token rights model lies in its ability to allow early investors to realize capital recovery earlier through the issuance or circulation of tokens, while also attracting a broader range of market participants. This flexibility may have profound impacts on the landscape of traditional equity markets. This can be referenced in (The Four-Part Series on Crypto Capital Part Two (Lower): A Battlefield Without Gunpowder - VC or Token Fund?).
On the other hand, the financial markets of most sovereign countries worldwide are extremely fragmented and lack liquidity, while the inherently global financial characteristics of crypto have greatly attracted these funds, including from countries like South Korea, Argentina, and Russia. Additionally, the stock markets of some Southeast Asian countries, led by Vietnam, have failed to keep pace with the wealth accumulation of the middle class, causing these emerging classes to skip directly to crypto, bypassing the local financial market stage. In the context of global digital currency compliance and integration with mainstream financial markets, the investment demand for private assets in these countries cannot be satisfied by their weak domestic financial infrastructure - the main board market (KOSPI) and the startup board market (KOSDAQ) in South Korea have over 2,500 listed companies, but 80% of them have a market capitalization of less than 100 million USD, and their daily trading volumes can be negligible. Conversely, the digital currency market, which attracts global retail funds, boasts the most abundant liquidity, making it the best target for their investment participation.
Image source: ForesightNews Samsung's current market value and trading volume
Note: From the image, we can see that Dogecoin currently has a market value of about 60 billion USD, while Samsung has a market value of about 234 billion USD, which is about four times that of Dogecoin. However, the 24h trading volume of Dogecoin reached 5.5 billion, which is tens of thousands of times more than Samsung.
In the strategic location of the global digital currency market - the United States, 2025 is likely to witness a new cryptocurrency legal system transformation. The two most important bills - FIT21 and DAMS - will impact the future of the crypto space. These two blockchain bills, regulated by the Commodity Futures Trading Commission (CFTC) rather than the Securities and Exchange Commission (SEC), fundamentally treat token issuance (token creation) as commodity trading rather than securities issuance, thus placing it under CFTC management. Considering that these two bills were proposed by the Republican Party, while the current SEC chair Gary Gensler represents the Democratic stance, the bills face significant resistance. However, if Trump is re-elected as president, with the Republican Party in control, the likelihood of the bills passing will significantly increase.
To explain this bill simply, it means that token issuance is treated as a commodity and regulated by the CFTC, thus legalizing it. This could greatly promote the enthusiasm for raising funds through token issuance. Enterprises can legally and compliantly raise funds by issuing tokens, attracting more capital into the crypto space. Furthermore, with a long-term compliant development channel, more people will steadfastly continue to engage in this industry even after making money. Most importantly, after the U.S. takes the lead in introducing this bill, it will officially unveil the global digital currency financial market and blockchain technology market, leading to competition among nations to 'grab projects' and 'attract talent.' In a completely globalized and freely flowing crypto space, this could further happen in the future. If U.S. policies become friendlier, and token issuance is no longer a gray industry but a respectable financial innovation, founders residing in relatively crypto-friendly countries like Singapore and Switzerland will soon undergo a massive migration.
Four
Looking back at 2016, when the number of crypto types worldwide could be counted on fingers, Bitcoin was like game coins, directly convertible into RMB to 'top up' on exchanges. We, the indigenous people of the token circle, had hopes for the future. (Specifically referenced in the end of (How Should We Invest in Digital Currency in 2021? Part One of Four).
Image source: ForesightNews
Image source: ForesightNews
That was also my dream.
Originally, my plan was to achieve these goals in 8-10 years.
But we only took four years.
It was at that time that I had a new dream - since Bitcoin as a monetary asset has been slowly accepted by mainstream society, other digital currencies, or tokens, apart from digital equity, should also serve as digital commodities, thereby generating utility in the future digital world of humanity, in addition to financial value, to help humanity better transition into the digital world.
Oh right, this thing was later given a new name by everyone - NFT.
'Digital commodities of the metaverse era,' this is my definition of the future of NFTs, and it is also the most important part of achieving 'internet age commodities' through Web3, digitization, and ultimately mass adoption.
It is for this reason that I resolutely built the NFT industry at the beginning of 2021. In the (Path to the Future - Web3 Five-Part Series) articles, I have described its future.
Five
Of course, the most intuitive attraction, or rather, the factor that makes more people willing to read my articles, is naturally the increase in Bitcoin's value.
It's time to get to the point. I need to mention my prediction for Bitcoin's market: the peak of this round for Bitcoin will occur at the end of 2025, with a reasonable range between 160,000 to 220,000 USD, and after that, in 2026, I suggest everyone to stay out of the market and recuperate.
In my paper written on January 1, 2019 (The Valuation Model of Bitcoin Under the Equilibrium of the Mining Market - Based on Pricing Theory of Derivative Financial Products), I mentioned the bottom of the four-year cycle from 2018 to 2021.
Image source: ForesightNews
Image source: ForesightNews
And the bottom of the four-year cycle from 2022-2025 that I mentioned in 2022.
Image source: ForesightNews
From the current perspective, the entire crypto space is at a critical crossroads. Today's digital currency industry resembles the internet industry at the turn of the century, and the bubble bursting is not far off in the next 1 to 2 years. With the passage of crypto-friendly laws like the U.S. FIT21, the compliance regulation of assets like token rights will be completed, and a large amount of traditional old money, which previously lacked understanding of crypto or even completely looked down upon it, will begin to accept Bitcoin and allocate it at a level of 1%-10%. However, afterwards, if blockchain and digital currency cannot gradually integrate with traditional industries and genuinely usher in the 'blockchain + industry' transformation, as the internet industry did with consumption, social media, and other sectors, I really do not see any new capital entering the industry and what reasons there would be for this industry to present astonishing growth opportunities again. DeFi in 2020, NFTs and the metaverse in 2021 — these were indeed the right directions and sparked a wave of innovation at that time. However, throughout 2024, while Bitcoin continues to reach new heights, the entire blockchain industry has not shown enough innovation to discuss; the market is merely filled with more memes and Layer 1, 2, and 3, without any new 'business concept innovations.' Moreover, looking ahead to 2025, the atmosphere of the entire industry has led me to be pessimistic about the emergence of milestone 'business concept innovations.'
When the tide rises, all boats rise with it. Now that the water is flooding, there are many small rafts, and everyone is competing to row faster, even mocking those heavy, machine-powered iron ships. But when the big waves recede, the wooden boats will run aground, and only those with enduring machine power can sail out of the harbor and embrace the sea.
In fact, making an interesting prediction, the mark of the crypto bubble reaching its peak will likely be when Buffett, the world’s largest opponent of Bitcoin, begins to change his tune and even participates in the industry. The stage victory of a revolution often occurs at the moment when the crisis is most latent.
We can compare the current crypto space to the internet era of 1999. After experiencing a rapid surge towards the right track, the digital currency industry may face severe adjustments starting from the end of 2025 due to a huge bubble. Looking back at history, the internet industry welcomed the IPO of Netscape in December 1995, followed by Yahoo's listing in April 1996, which sparked a market frenzy. On March 10, 2000, the Nasdaq index reached a historical peak of 5,408.6 points. However, the bubble quickly burst afterwards, and by 2001, the market entered a winter phase. Although the broad winter period lasted until 2004, the real low point was in October 2002 when the Nasdaq index nearly fell below 1,000 points, symbolizing the industry’s lowest valley from a financial perspective.
Image source: ForesightNews
In 2020, MicroStrategy successfully boosted its stock value by purchasing Bitcoin, achieving a significant stock-coin linkage effect for the first time. By February 2021, Tesla's announcement of purchasing Bitcoin became a landmark event marking the entry of large corporations into the space. These historical moments inevitably remind one of the blockchain industry's '1995-1996' - the initial wave of the internet boom.
Looking ahead, I believe that by the end of 2025, Bitcoin's price may reach a long-term phase peak, but by early 2027, it might touch a new low. Once the FIT21 bill is passed, it may trigger a wave of everyone issuing tokens, just like the unprecedented boom during the '.com' era.
If the threshold for token financing is lowered to nearly zero, where even ordinary people can easily issue their own tokens like high school students learning to create a website, then the limited capital in the market will be rapidly diluted by the influx of various tokens. In such an environment, the final wave of 'frenzied bull market' belonging to token issuers may not last more than three months. Subsequently, due to the imbalance of supply and demand in the market and capital exhaustion, the industry will inevitably face a comprehensive collapse.
However, before that, in the next 12 months, we still have the potential for Bitcoin to rise nearly 2 times in beta, and for ordinary people, due to the global liquidity accumulation, numerous early-stage tokens with 'hundredfold or thousandfold' opportunities within a very short time — why not participate?
Image source: ForesightNews
Looking back at the once-booming internet industry, which was criticized by many media outlets as a 'bubble.' Today, the Nasdaq index has surpassed the 20,000-point mark. Looking back at 2000, it seemed like a peak, but now it is just a small hill. Even if you entered the internet industry in 2000 and persisted until today, it would still be one of the best choices.
Bitcoin, just a series of small hills.
It has been 3,202 days since I bought my first Bitcoin on March 7, 2016.
I still remember the price displayed at the moment I clicked the mouse, which was 2,807 RMB, just under 400 USD.
Many people have asked me, how high do you think Bitcoin can rise?
This question is meaningless. The price of gold has also been reaching new highs these days and in recent years.
A meaningful question is, how high can the price of Bitcoin rise before a certain point in time?
We shall see.
The best is yet to come.
[Disclaimer] The market has risks; investment must be cautious. This article does not constitute investment advice, and users should consider whether any opinions, views, or conclusions in this article align with their specific situations. Invest at your own risk.
This article is authorized for reprint from: (Foresight News)
Original author: Ling Zi'ang (Tony Ling), pen name Long Ye
'Want to enter while it's hot! 2025 is the last wave of Bitcoin's bull market, and a long winter lies ahead?' This article was first published in 'Crypto City.'
