Crypto Market Outlook: Bitcoin Demand Continues, Altcoin Differentiation Intensifies

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Crypto Assets Market Outlook: From Current Trends to Future Opportunities

Recently, I have had more time to think, and I would like to share some thoughts on the market.

The overall trend of the Crypto Assets market may not become clear until after September. Considering macroeconomic resistance, summer liquidity constraints, and quarterly position adjustments, the real market dynamics will only emerge when participants return after the August holidays. Recent market activity shows that the rise of most small coins is mainly due to short covering. Traders, influenced by the previous rebound, chase momentum but lack support from long-term holders. Most people have already been frustrated by previous market volatility. As expected, the majority of rapidly rising tokens subsequently experienced the same severe decline.

Ethereum rebounded unexpectedly, with previously underperforming AI-related tokens leading this surge. In contrast, tokens with real utility, strong fundamentals, or buyback mechanisms demonstrated resilience, being more stable during the downturn and recovering faster. From this, we can draw the following insights:

1. The demand for Bitcoin is real and durable

Traditional capital is gradually entering the market through regulated channels such as ETFs.

The capital nature supporting Bitcoin now is completely different from previous cycles. This is why large-scale Bitcoin liquidations are unlikely to occur unless influenced by macro events.

2. The internal differentiation of small crypto assets intensifies

Ultimately, funds will flow back into small Crypto Assets, but will not fully cover. Only tokens with clear use cases and practical application scenarios are likely to attract these funds. This is why Ethereum may perform better than other public chains. Regulatory clarity, the growing adoption of decentralized finance, a deflationary structure, and staking demand together create a strong virtuous cycle. Moreover, due to Ethereum's long failure to meet expectations, there are still potential buyers waiting for opportunities.

3. Tokens Supported by Venture Capital Face Structural Risks

Token unlocking will continue to put pressure on price trends. In the case of insufficient liquidity, ongoing sell-offs from validators and early investors limit the potential for upward movement. This is why highly valued tokens listed on centralized exchanges may not be a good choice in the future. Tokens from certain ecosystems, in particular, face ongoing sell-off pressure due to their validator reward structure that leads to this situation.

4. Network effect tokens have structural advantages

These types of coins have structural advantages, with no venture capital unlocks, fairly issued, and completely based on attention. This is a pure speculation mechanism that has played a role in the early cycle.

But I think this phase is coming to an end.

The launch of certain token generation events marks the peak of interest in this type of token. Since then, people's interest in this type of token has begun to wane. Even during the rebound in April, the performance of certain public chains was not as good as Ethereum. If everyone already holds a certain coin, who will be the marginal buyer when the momentum of this type of coin fades?

Some tokens may still perform well, especially those that have gained popularity through influencers on mainstream social media. These may still create asymmetrical wealth effects. However, the era of pure speculation is over. Only those tokens with strong narratives and significant market recognition have true speculative value.

Ironically, the fatigue and skepticism towards venture-backed tokens have opened the door for fairly issued cross-border projects, which will become the next wave of wealth creation opportunities.

Some emerging projects are great examples. But to seize these opportunities, you need to be active on the chain. When there is information asymmetry, big opportunities always arise. Once everyone knows about something, it no longer has returns.

This is why I am more focused on the on-chain market. The success of certain projects has sparked the desire to find the "next hotspot," and capital has started chasing similar fair launch token narratives. Just as some have made huge fortunes by trading certain tokens, attention guides capital flow.

5. Future Market Trends

So, if pure speculative tokens are no longer the opportunity, what will be next?

My point of view: The combination of artificial intelligence and Crypto Assets.

If you have been following my updates, you would know that most of my operations during this cycle have focused on specific tokens and artificial intelligence.

Just like the craze for decentralized finance, most early artificial intelligence projects failed after the hype. However, truly practical projects are quietly being built during this market downturn. We have already seen some of these projects emerge on the blockchain.

As the profits from certain tokens dwindle, attention will naturally shift to new narratives. Artificial intelligence, with its clear practicality, is well-suited to become the next focal point.

Many projects that combine artificial intelligence and Crypto Assets adopt fair distribution, echoing the narrative of the aforementioned emerging projects.

This is why I take time to research and lay out my plans in this field during calm weeks. There is no need to rush to establish a full position now, but I believe that if the market experiences a strong upswing again, this field will harbor the greatest asymmetrical opportunities.

The rapid development concept of technology that makes artificial intelligence a reality — Stock Photo

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CryptoTherapistvip
· 23h ago
sensing high market trauma... typical post-dump anxiety patterns detected. let's breathe and process this together
Reply0
MoneyBurnervip
· 10-07 06:01
Warning for suckers in small coins! After being played for suckers, I will continue to play!
View OriginalReply0
HodlVeteranvip
· 10-07 02:57
What the hell, familiar smell, I can smell the suckers are going to be played for suckers again.
View OriginalReply0
GasFeeBarbecuevip
· 10-07 02:57
The bull run has just begun, just hodl and that's it.
View OriginalReply0
AltcoinOraclevip
· 10-07 02:57
my fractal algos show a clear wyckoff distribution on eth... ngmi if ur not seeing it
Reply0
0xTherapistvip
· 10-07 02:50
Those who didn't catch this wave are being played for suckers again.
View OriginalReply0
LiquidatedTwicevip
· 10-07 02:38
The reversal is in September, go long!
View OriginalReply0
LiquidationWatchervip
· 10-07 02:30
been there, lost that... september gonna rekt so many degens again
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