BTC continues to oscillate, and this may last until next week. I previously mentioned the altcoin season, and even if it occurs, it is only localized. I believe everyone has experienced 2021, and I can responsibly tell you that in 2021, there was a great deal of liquidity in the market, but the secondary altcoin market only saw the strong getting stronger, while the weak became very weak.
2021 was the era of the metaverse, gaming, DeFi, public chains, and memes. As we move into 2024-2025, the focus has shifted to public chains, AI, memes, and a few popular sectors. Currently, BTC is still oscillating between 91,500 and 98,000. Although there was some volatility last night, previous emotions have already been overhyped, so BTC remains around 94,000. It's the weekend now, and market liquidity is low, so it is expected to oscillate through this period.
From the on-chain data of BTC's URPD (this indicator shows the concentrated zones of on-chain transactions, which are often used to determine market support/resistance levels), after last night, the support at 92,000 and 93,000 remains strong, and it is estimated to continue oscillating around 94,000. Looking forward to Trump making a statement next week. Anyway, there's still time. Let's see if BTC can slowly rise like it did in the early days of the month. Currently, the on-chain interest in SOL is still decent, and the updates on AI and other related fields are evolving rapidly, but I think the leading projects, especially those listed on large exchanges, can still be played back and forth.
It is worth mentioning that the Los Angeles wildfires have caused 10,000 families to lose their homes, and Airbnb bookings are even pushed back to a year and a half later. The payout time for insurance companies is entirely determined by the amount of compensation discussed. If these wildfires lead to Bitcoin being sold off, causing a drop, I think there is a possibility for such statements.
As of now, the assets burned in Los Angeles have exceeded 150 billion dollars, which translates to 1.5 million Bitcoins, an astronomical figure. Even if only 10% of people choose to liquidate Bitcoin to get through difficulties, the amount will still be enormous.
Most importantly, this wave of wildfires has burned down wealthy areas, and in some regions, the median home price exceeds 3 million dollars. Combined with other assets in the homes, the quantity is unimaginable. It is logical for these wealthy individuals to allocate Bitcoin, making this a short-term black swan event for Bitcoin, and capital outflows may continue.
From a macro, technical, or news perspective, it is entirely normal for Bitcoin to experience a correction. There will definitely be higher points in the future, but we need to maintain a bit of patience now.
Yesterday, Grayscale took action again. They have already published two reports this year:
1) Promising altcoins for Q1 2025
2) List of assets to consider for altcoins
The so-called list of assets to consider means that Grayscale is currently seeking some quality altcoins to include in their asset list. If so, these altcoins likely expected to be added could see a wave of large capital inflows in the near future.
Out of 39 forms, 12 projects are related to AI, accounting for nearly 30%. It is evident that Grayscale is mainly focused on the traditional Layer 1, AI, and DeFi sectors.
Does the four-year cycle still exist? Will this year be a crazy bull market like 2021? Can any trash in the secondary market rise 10 times?
The macro backdrop this year is different from 2021. Why do I say that? In 2021, there was significant monetary easing, the largest scale of easing since 2008. This year, we are still in a high-interest rate environment, and the balance sheet reduction has not ended.
What we expect is balance sheet expansion, not monetary easing. Easing is an extraordinary measure taken after interest rates drop to zero, and short-term rates are unlikely to drop to zero all at once. The current rate is still 4.5%.
Regarding balance sheet expansion, a prominent macro figure previously predicted when the balance sheet reduction would end, likely in the first to second quarter. Subsequently, expansion should not be far off, and we may see it this year. Although there is no easing currently, there are ETFs and a friendly attitude from Trump, so BTC has broken through 100,000, but there has not been more liquidity flowing into altcoins. Concerning the four-year cycle, there are actually opportunities for trending markets every year, even in 2022, GMT was born. From now on, the chances for a trending market still exist.
During a crazy bull market, can any trash in the secondary market rise 10 times? Perhaps friends have fallen into the illusion of a bull market. As I mentioned earlier, not all projects in the secondary market could rise more than 10 times in 2021; some remained dormant or peaked at opening. Don't forget, financial markets are all about harvesting, and even BTC is no exception. However, projects that attract capital and have a narrative will continue to rise; don't say 10 times, it could even be a hundred times. Therefore, choosing projects is a technical job.
Although I previously mentioned that public chains, memes, AI, and a few leaders are favored by capital, friends have also noticed recently while playing on-chain projects that the same narrative can lead to different outcomes. Some can be listed on large exchanges, while others stagnate after a slight rise. Therefore, I often say, take the profit and leave; there are plenty of opportunities in the market, and you must have the ability to keep making money.
In recent years, I have been contemplating the meaning of trading cryptocurrencies, and I have come to a conclusion: trading cryptocurrencies is about picking up the pieces.
2.4 to pick up pnut, currently 0.5
0.9 to pick up act, currently 0.28
0.3 to pick up ban, currently 0.05
0.003 to pick up neiro, currently 0.0008
This is our mission, and it is what we are best at.
