Market Trend Analysis and Future Outlook

After a deep reflection over the weekend, I would like to share some personal insights on the current cryptocurrency market.

I don't think the real direction of the crypto market will become clear until September. With the market facing multiple factors such as macroeconomic headwinds, a lack of liquidity in the summer, and a quarter-end rebalancing of positions, the true market dynamics may not be revealed until the end of the August holiday season and the full return of market participants. Recently, it has been observed that most of the altcoin's rally is mainly due to the short squeeze effect, with traders chasing short-term momentum under the conditioned reflexes of previous market rallies but lacking real long-term holder support. Most of the participants have already been hit hard by previous market corrections. Unsurprisingly, those coins that rose quickly then experienced similarly sharp pullbacks.

Ethereum's performance has been surprisingly strong, with previously struggling sectors such as artificial intelligence and meme coins leading this rebound. In contrast, tokens with actual application value, strong fundamentals, or buyback mechanisms have shown greater resilience—they performed more steadily during the downturn and recovered more quickly, such as Syrup, Hype, and AAVE. Although SPX belongs to the meme coin category, its structural design is entirely different. From these phenomena, we can draw the following insights:

1. The demand for Bitcoin is real and lasting.

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

The current capital nature supporting Bitcoin is fundamentally different from past cycles. This is also why large-scale Bitcoin liquidation is unlikely to occur unless triggered by significant macro events.

2. The differentiation in the alternative coin market will further intensify.

In the long run, capital will inevitably flow back to the altcoin market—but it will not be comprehensive. Only those tokens with clear use cases and practical application scenarios can truly attract capital inflow. This is precisely why I believe Ethereum will outperform Solana. The four key factors of regulatory clarity, the growing usage of decentralized finance, the deflationary mechanism, and the demand for staking together form a strong positive cycle. Moreover, due to Ethereum's long-term failure to meet market expectations, there are still a large number of potential buyers waiting to enter the market.

3. Tokens supported by venture capital face structural risks

Token unlocks will continue to exert pressure on price trends. In cases of insufficient liquidity, the ongoing selling from validators and early investors will limit the upward price potential. This is also why I believe that tokens listed on centralized exchanges with overvaluations have poor future prospects. Especially tokens within the Cosmos ecosystem, which face ongoing selling pressure due to their unique validator reward structure.

4. Memecoins have structural advantages.

Meme coins have certain structural advantages: no venture capital unlocking pressure, fair launch, completely based on community attention. It is a purely speculative mechanism - just like in the early crypto cycles, this model really works.

But I think this phase is about to end.

The token generation event of Pump.fun and the launch of Trump Coin marked the peak of interest in meme coins. Since then, the market's interest in meme coins has begun to wane. Even during the market rebound in April, SOL's performance was not as good as ETH—if most people already hold SOL, who will become the marginal buyers when the meme coin craze fades?

Some meme coins may still perform well, especially those that have gone viral through influencers on platforms like TikTok or Instagram, transcending the crypto community. These may still bring asymmetric wealth effects. However, the era of relying solely on cute animal-themed meme coins as a source of profit has ended. Only projects with strong narratives and clear market positioning—capable of generating collective belief among people—hold true speculative value.

It is worth noting that the market's fatigue towards venture capital-backed tokens has created opportunities for fairly launched Web2/3 projects, which may become the source of the next wave of wealth growth.

Keeta is a typical case. It is crucial to seize such opportunities and actively participate in on-chain activities. When information asymmetry exists, great opportunities will always arise. Once an opportunity becomes known to everyone, its return value will significantly decrease.

This is also why I am paying more and more attention to the on-chain market dynamics. The success of Keeta has sparked a frenzy to find the "next Keeta," with capital beginning to chase similar fair launch alternative token narratives. Just as traders have amassed over a billion dollars in wealth through meme coin trading—attention directs capital flow.

5. Future Market Trend Outlook

So, if meme coins are no longer the main opportunity, what will the next hotspot be?

My view: the integration of artificial intelligence and blockchain technology.

For those who pay attention to my views, they will find that my main layout in this cycle—after early investments in SOL and venture capital-supported tokens—mainly focuses on meme coins and the artificial intelligence field.

Just like the decentralized finance summer, most early AI projects have failed after the hype. However, projects that are truly based on practical value are quietly building during the market downturn. We have already seen some projects emerge on the chain.

As the profit margins of meme coins decrease, market attention will naturally shift to emerging narratives. AI, with its clear practicality, is well-suited to become the next focal point.

Many projects combining AI with cryptocurrency adopt a fair launch model, echoing the success story of Keeta.

This is also why I have conducted in-depth research and positioned myself in this field during the relatively calm weeks in the market. There is no need to rush to establish a full position now—but I believe that if the market enters a strong upward cycle again, this field will contain the greatest asymmetric opportunities.