The development prospects of Ethereum ecosystem

Source: Daoshuo Blockchain

1. Ethereum is challenged and diverted by other public chains. Is this the main factor that drags down Ethereum? Ethereum and Bitcoin have never diverged so seriously before, right?

I think the reason why the price of Ethereum is down is mainly attributed to two points:

First, there is no major innovation in the application of the Ethereum ecosystem in this round of trend.

Second, other blockchains have diverted Ethereum's attention in terms of innovation or hot spots.

Regarding the first point, some readers may say that in this round of trend, Ethereum has seen re-staking and second-layer expansion. Isn't this a big innovation?

In my opinion, these innovations are indeed innovations, but they are all innovations in infrastructure, not innovations on the application side. Innovations in infrastructure are aimed at a small user group, while innovations on the application side can radiate to a wide user group and trigger the rapid growth of the ecosystem.

In the last round of bull market, DeFi, NFT and chain games in the Ethereum ecosystem are very typical innovations on the application side. Especially NFT, which has attracted a large number of users to the Ethereum ecosystem in an almost barrier-free manner.

And this round of Ethereum is still too lacking, at least so far.

Regarding the diversion of attention from other blockchains to Ethereum, the most typical example is the rise of the Bitcoin ecosystem and the emergence of Solana meme coins.

The growth of these blockchain ecosystems has created a huge wealth effect in the short term, diverting a large number of users and hot spots from the Ethereum ecosystem.

However, in the long run, I am not worried about these problems, because I firmly believe in the creativity and vitality of the Ethereum ecosystem, and I also firmly believe that the price of Ethereum will not be so sluggish for a long time.

2. What position is suitable for short positions now?

At this position, if you are short positions, but still want to do something, I think it will be embarrassing, because it feels a bit like "no village in front, no store behind".

My suggestion is:

Either continue to short position, no matter what happens next, do not buy any coins, force yourself to calmly watch everything that happens next, and then reflect on what mistakes you made in this round, and what operations you did not do properly.

If you don't want to short position, just buy Bitcoin and Ethereum, which is a safer and controllable method. But if you buy Bitcoin and Ethereum now, even if you wait until the bull market climaxes, the returns will probably be very limited. Therefore, it will be very difficult to lock in profits as much as possible with such operations.

3. Magic at 0.78 doubled some time ago but did not sell. This time it fell to 0.6 again. Should I take it again? In addition, is this a big drop before and after the halving?

So far, all the coins I have invested in (including Magic) have never been sold, and they will not be sold now. I will still do as I have written many times in the article. As long as there is no big problem with their team next time, I will wait patiently until the bull market comes to cash them out.

As for whether this big drop is the big drop before and after the halving, I guess what this reader wants to ask is, is this big drop the last big drop before and after the halving?

If this is the question the reader wants to ask, I can only say that I can't predict such fluctuations, but I can definitely deal with such fluctuations.

Why?

Because if I follow my method, I will:

First determine whether the market has entered a bull market.

If it has not entered a bull market, then continue to operate according to the strategy we set in the bear market.

If it has entered a bull market, then operate according to the selling strategy I set in the bull market.

The current situation is that according to my standards, it is not a bull market yet, so I continue to operate according to the strategy I set in the bear market: Because Bitcoin and Ethereum have passed the fixed investment price, I will no longer make fixed investments. I will no longer buy other fixed investment coins. Then I will occasionally buy some of the remaining funds if I like them and think they are valuable.

So as long as we have made arrangements for market fluctuations in our pre-set operations, when these fluctuations come, we just need to follow the set operations.