GuShiio.com More funds flow back and forth in the existing cryptocurrency field, showing a “clean and flat” state.
Author:Route 2 FI
Compiled by: Shenchao TechFlow
Gm, friends.
The crypto market is undergoing earth-shaking changes, and we must adjust our strategies and tactics because the methods that worked well in the past no longer apply.
The traditional buy-and-long-term hold (HODL) strategy is fading out. As market volatility increases and new projects emerge one after another, long-held beliefs become more fragile.
Today,The survival rule of the market is flexible trading and constant adjustmentpositionsFind opportunities in a decentralized and uncertain environment.
Whether you can successfully adapt to this new situation will determine whether you survive or be eliminated by the market.
Let’s take a deeper look and see if there is still a ray of hope in such a market.
Altcoin Casino: How to find a way to survive in a fragmented cryptocurrency market
For those who have only entered the crypto market in the past year to a year and a half, the market is undergoing a profound transformation.
Shortcuts that were once easy to achieve profits through centralized exchanges have become increasingly complex. The market operates more like a casino than a traditional trading market,This requires investors to have unprecedented flexibility and acumen.
The traditional buy-and-hold strategy, which worked in the early cycle, no longer applies. Holding cycles are getting shorter and shorter, from weeks or even days (remember those old players telling us that we just need to buy altcoins at a low price and then wait until the high price and sell?).
Behind this change is the continuous emergence of new coins and new projects.Every new project is competing for market attention and funding, constantly challenging the status of existing projects.
Even events that have traditionally been regarded as positive can have unexpected consequences. For example, Trump launched a high-profile Meme that could attract a large number of new users to the crypto market, but could also cause the value of many altcoins to plummet. Generally, beneficiaries are limited to Bitcoin (BTC), Solana (SOL) and related Meme coins.
Many investors have learned a painful lesson from this. If their portfolios were not heavily invested in BTC and SOL, they could suffer huge losses.
A similar situation occurred with Berachain’s release, which attracted a lot of attention and money but had an impact on the Abstract ecosystem.
In such a dynamic and unpredictable market, the wisest thing to do is to accept that volatility is the norm in the market and realize that this volatility may intensify further as new currencies, new chains, and new projects continue to emerge.
As a result, many investors are recalibrating their strategies toIncrease BTC and stablecoinspositionsProportion, while significantly reducing long-term altcoin positions。The focus of the market has also shifted from long-term investment in altcoins to tactical operations in short-term trading.
The goal is to avoid becoming the last believer in failed projects and watching their value go to zero.
At the end of the current cycle, when buying currencies other than BTC based on long-term investment logic, the risk-reward ratio may not be ideal. Although altcoins may be near the bottom, it is increasingly unlikely that most currencies, NFTs or ecosystems will hit new highs at the same time.
A large number of new currencies are launched every day, diluting market attention and funds, making it more difficult for existing projects to re-emerge.
(Related articles)
The current cryptocurrency cycle is full of unprecedented challenges because of a general sense of uncertainty in the market than ever before. This uncertainty mainly stems from the fact that:Even the popular altcoins are not confident enough to confirm that they will rebound after experiencing a sharp decline.
Looking back at the 2017 and 2021 cycles, investors are generally confident in the decline in buying altcoins, as long as the market capitalization (mcap) of these projects is not too low (usually less than $100 million). The prevailing view at the time was that these currencies would regain their value during the cycle, or at least not go completely silent during the current cycle. Those currencies that gain market attention early tend to maintain their popularity and market position until the end of the cycle.
However, this cycle is completely different (yes, it is). The market is full of narratives and sub-narratives, each competing for investors ‘attention, but this attention is often fleeting.Investors are now more cautious about bargain-hunting because the entire narrative of a currency can collapse at any time, making the investment worthless.
Unlike the past cycles with a single main line as the core, today’s market presents multiple narration-driven cycles, each with its own highs and lows. Bitcoin (BTC) and Solana (SOL) are widely considered relatively safe options that may eventually regain their value, but their potential returns may not be attractive to investors pursuing high-multiple growth (after all, BTC has risen 6 times from the bottom, while SOL has risen 20 times). The question is whether money should be invested in areas such as AI cryptocurrencies. Although these areas have attracted much attention recently, they have fallen sharply from historical highs and there is no clear sign that they can return to their peak.
The high degree of fragmentation of markets makes it difficult for investors to accurately identify and capture emerging trends.Cryptocurrency has been a speculative market since its inception, although past cycles have attempted to justify it by emphasizing the solid fundamentals and real-world applications of peer-reviewed blockchain technology. However, this cycle seems to have abandoned this disguise and embraced a more realistic view:Everything depends on how to attract and keep the market’s attention.This trend has led to a significant shortening of investor attention cycles in the market. The bull market cycle that once lasted one to two years has now been compressed to just a few months, weeks, or even days.
The market currently seems to be experiencing a Meme supercycle (or is it over?). However, even the most popular Memes have experienced a sharp fall from their peak, making the legitimacy of investing in them even more questionable.
In the current crypto market, investors face higher risks than ever before. In past cycles, when currencies have experienced similar declines, investors have often viewed them as a bottom-hunting opportunity, because the possibility of these currencies eventually recovering is almost beyond doubt. However, the question now is whether these currencies can regain the market attention they once had. Currently, the market prefers to support leading currencies rather than projects that lag behind. Even if some projects have strong fundamentals, it will be difficult to gain favor if they lack market enthusiasm.
Although Meme coins and AI projects are performing well in the current market, investors remain cautious about these trends because market focus often shifts quickly and unpredictably. This general uncertainty stems from the sheer variety of options faced by investors. There are thousands of currencies and projects competing for attention in the crypto market, making it difficult for investors to judge which projects have real potential and which are just short-lived. The scattered and short-lived market attention makes it difficult to form a long-term market consensus on a certain project. A question worth pondering is whether this phenomenon has become the new normal in the crypto market, or is it just a temporary phenomenon in the current market environment.
Typically, every market cycle goes through an initial period of chaos and distraction, followed by gradual stabilization as clear winners emerge. However, it is also possible that the market has changed fundamentally, and investors ‘attention spans have become shorter and shorter, making it impossible for a single narrative to dominate for long periods of time. At the same time, macroeconomic factors are also profoundly affecting the current market structure. In the past, loose monetary policy made investment relatively easy because abundant liquidity contributed to the formation of speculative bubbles. However, in the current environment of high interest rates and tight liquidity, the market has become more severe.
Investors ‘weakening confidence in bottom-hunting is likely to reflect broader economic realities.Amid the uncertain economic outlook, investors ‘risk appetite has dropped sharply. Debates about the traditional four-year cycle have also gradually increased, with some predicting that the cycle may be extended. However, judging from current market performance, the four-year cycle seems to still exist, but there have been some significant changes compared with the past. For example, market performance in the current cycle has been relatively sluggish: Bitcoin has only reached about 1.5 times its previous historical high, while Ethereum has not even been able to break through the new historical high. This market performance was largely driven by specific events, such as Michael Saylor’s support for Bitcoin and the launch of the Bitcoin ETF, which attracted the attention of institutional investors. However, capital inflows other than the Bitcoin ecosystem are very weak, and speculative capital flows more to Meme coins, which have a very short life cycle.
In the current market,Extensive speculative funds have almost disappeared, and the market lacks enough motivation to break through the overall new high. On the contrary, more funds flow back and forth in the existing cryptocurrency field, showing a clean and flat state.Due to the lack of major liquidity providers, it is difficult for these scattered hotspots to drive overall capital flows and attract large capital inflows from new investors.
The performance of this round of crypto market cycle is significantly different from previous bull markets. This has triggered deep thinking about the nature of the crypto market cycle.The current market lacks a widespread speculative boom, with gains concentrated in Bitcoin, while funds are more circulating within the crypto ecosystem.These phenomena suggest that the market is trying to adapt to a new operating model. Key factors that have driven bull markets in the past, such as loose monetary policy and the enthusiasm of retail investors, seem to be less significant in the current environment. The long-awaited alt szn, a period when almost all altcoins experience rapid growth, has not really arrived yet.
Since the launch of the Bitcoin ETF, the gap between the market value of Bitcoin and the total market value of other cryptocurrencies (i.e., the BTC-TOTAL2 indicator) has continued to widen. In the past shanzhai season, a large amount of speculative funds poured into the market, and almost all currencies rose indiscriminately. However, today’s Bitcoin seems to have become an independent existence, and its price trend is more influenced by the strategic layout of ETFs and Microstrategy, the macroeconomic environment and political factors. By contrast,The shanzhai market is more like a high-risk casino. Only when the market has a large numbernet inflow of funds, and only when you can choose the right investment direction can you get a return.
However, in this casinoBehind every winner is a loser.Compared with previous cycles, the crypto market in 2025 will be more complex and difficult to grasp. There are too many investment tracks (i.e. different altcoins and segments) in the market at the same time, and new tokens are emerging every day to compete for investors ‘attention and capital. Too many choices make it difficult for investors to quickly identify projects with real potential, and also increase the risk of falling into failed projects.In such a rapidly changing market, success requires extremely high insight, keen market awareness and flexible response capabilities.
Still, there are still some people who are confident about the future shanzhai season, and I sincerely hope their predictions will come true.
That’s all for today’s sharing.
I wish you all a nice weekend and we will see you next week!
Welcome to join the official social community of Shenchao TechFlow
Telegram subscription group: www.gushiio.com/TechFlowDaily
Official Twitter account: www.gushiio.com/TechFlowPost
Twitter英文账号：https://www.gushiio.com/DeFlow_Intern
