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Still bullish?Or are we in the "wealth destruction" phase now?
Will there still be a crypto bull market in 2025? Why do I still feel pessimistic despite so many bullish factors? How should we critically analyze the market cycle?
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I think we reached the wealth destruction phase soon after Trump took office. In the current market environment, the political actions regarding the "Bitcoin Strategic Reserve" have not had an impact on the market - this is an important signal. In this phase, the market's rebound often encounters key resistance levels and eventually fails (I saw the market's reaction to Trump's tweet about crypto reserves last week).
Trading volume on the Solana decentralized exchange has dropped 80% from its peak after Trump launched his Memecoin. At the same time, the number of active independent traders has dropped by more than 50%. I think the speculative enthusiasm in the market is weakening.
The current "cycle" behaves differently than past cycles. For the first time, BTC hit an all-time high before the halving. This cycle is shorter, with only a two-year bull run. The "altcoin season" behaves very differently, with Bitcoin dominance rising in a stair-step manner since the beginning of 2023. Bitcoin is now fully integrated into the financial system and backed by the US government. So it's too early to tell.
Since mid-January, global M2 has increased by 1.87%, mainly due to central banks shifting from tightening to easing. I think the dollar will continue to fall as investors move money overseas, but the pace of decline in the coming weeks may not be as rapid as it has been recently. I expect China to continue to ease policy against the backdrop of a lower dollar. However, the Fed may not ease in the short term as they say reserves remain "ample." In addition, I believe the Fed is still concerned about inflation.
One of my concerns is that the bear market view is becoming the consensus view. But for now I would still stick with all the other factors because there are signs that the cycle top has been formed and the bear market is coming. Of course, in the long term, there are many reasons to be bullish.
what do you mean in wealth destruction
Bull market
Nope
Bullish
Don't say that
still
