Lessons from the crypto market decline

Yesterday, the entire market was cold again, and Bitcoin fell below $90,000.

Many voices attributed this decline to the recent epic theft of Bybit Exchange.

Although the accident has been properly handled with the efforts of the exchange and the assistance of all parties, people are worried that the stolen ETH will cause huge selling pressure on the market.

In fact, regardless of whether this selling pressure actually occurs, this incident will definitely have a great impact on the market sentiment.

In addition, some of the latest data released by the United States are not as expected, and the negative impact of Trump’s latest policies may have a certain impact on the crypto market.

The current crypto market has become a "frightened bird". Whether it is external or internal, any disturbance may cause the market to suffer a blow.

In addition to these things, there is another thing that has received a lot of attention recently:

Pump.fun is going to launch its own AMM exchange.

As soon as this news came out, the Raydium exchange token, which Solana meme coins rely heavily on, also suffered a major impact.

On the surface, this matter is that Pump.fun does not want the fat water to flow to outsiders. Since the exchange has made such a lucrative profit from it, why don’t I do it myself?

But it feels more like an upgrade of involution. The profits from issuing meme coins are getting thinner and thinner. In this case, the project party is no longer willing to share the benefits with other partners in the ecosystem.

In the past, such things would only happen when the market was in a deep bear market. We have seen many such examples in the Ethereum ecosystem in 22 and 23.

Although in my opinion, we have been in a bear market so far, I am still somewhat surprised that the bear market has started to roll back.

This also shows that the entire ecosystem currently does not see any sub-sectors that can attract external attention, so rollback has occurred.

Combining the above conditions, and recalling the various things we have experienced in this round of market, one phenomenon is becoming more and more obvious:

Although Bitcoin still seems to be the leader of the entire market and leads the market of the entire crypto ecosystem, Bitcoin is increasingly unable to survive on its own. In the past, when the entire ecosystem was hit by various shocks, other currencies fell, and Bitcoin could still withstand the shocks; but now Bitcoin is increasingly unable to withstand these shocks.

This shows more and more clearly that without the prosperity of the entire ecosystem, the price of Bitcoin itself is not solid.

For the entire ecosystem to experience a general rise, there must be a real application explosion. Without innovation in technology, models and business, the advancement of the entire crypto ecosystem can only rely on the support of the concept of Bitcoin as "digital gold". But this concept cannot support this ecosystem for a long time, nor can it support the price of Bitcoin for a long time.

Since Bitcoin broke through $100,000 in early December last year, it has almost only hovered around $100,000. Since then, all kinds of positive news have almost failed to push its price further up, but as long as there is any negative news from inside or outside the ecosystem, the price of Bitcoin may be hit by $100,000 at any time.

So I think that if the crypto ecosystem still does not have another ecological explosion, even if the policy of Bitcoin becoming the US national reserve can be implemented in the future, the room for Bitcoin to rise in this round of market will be very limited. And if there is any negative information from outside or inside in the future, the price of Bitcoin may even be affected and continue to fall.

I once speculated that this round of market may reach a climax between March and August, but now it seems that unless a miracle happens within the ecosystem, if the current situation does not change, even if there is a miracle, it will probably be a tasteless market.