The logic of the bull market: the magic code that siphons the whole world

The bull market will come, and the logic of the bull market remains unchanged, that is: internal surge + external big money + paradigm mutation. Internal surge does not necessarily mean the invention of new tools or the birth of new products. It may be a "system" with surge genes formed by chance due to some historical reasons. I think the surge gene of this round of bull market is the solana platform, which is equivalent to the ICO and uniswap in history.

Bitcoin halving + exceeding the historical high = real surge

People in the currency circle all over the world are looking forward to the next uniswap moment, but in fact, the theme of each bull market is not to continue the direction of the previous bull market, that is, there will be no Defi2.0, ICO2.0, and Bitcoin imitation 2.0. This is the magical place in the field of blockchain, where innovation and iteration are very strong and very fast.

No matter what, the bull market will still come, and the logic of the bull market remains unchanged, that is: internal surge + external big money + paradigm mutation.

The internal surge does not necessarily mean the invention of new tools or the birth of new products. It may be a "system" with a surge gene formed by chance due to some historical reasons. I think the surge gene of this round of bull market is the Solana platform, which is equivalent to the ICO and Uniswap in history.

ICO and Uniswap can both be considered as internal surge factors, but they are in different directions and categories. SOL has a market value of nearly 100 billion US dollars, plus the value of other tokens on the platform. After more than a year of accumulation from low to high and from small to large, the platform has formed a super huge pool of profitable funds. These funds have a similar leverage effect to any new project. The leverage here is not the leverage of futures, and it is not borrowed.

In other words, in this round of bull market, the solana effect is equivalent to the ICO and Uniswap in history. It's just that Uniswap's surge gene is xy=k. The explosion of Tugou on Uniswap in May 2020 was due to this mechanism, which is the internal cause of the surge. Earlier ICOs allowed many project parties to discover new methods that are different from traditional financing methods.

These are all internal causes of the surge.

External factors can be understood by big money. After the approval of Bitcoin ETF, huge amounts of external capital will flow into cryptocurrencies, which will inevitably bring in a huge amount of new external retail capital.

The last factor is the birth of a new paradigm, which often occurs later than the first two factors, such as pledge mining. According to this logic, the new paradigm of this round of bull market has not yet been born, and it is not an inscription rune or any other model that has already appeared. However, the model of BOME may imply some new bull market new paradigm genes that will be born in the future.

Solana is more significant in this year's bull market than the smart chain in the previous bull market. It may be the key to DEX surpassing CEX in the future. If so, the future market structure of Uniswap will also face the challenge of DEX on Solana. It is very likely that in this bull market, the transaction volume of decentralized trading applications will exceed the transaction volume of the largest large-scale centralized exchanges at a certain period. In other words, DEX surpassing CEX has really come, and it happened on Solana.

Specifically, the 24-hour trading volume of a certain token or some tokens exceeds the scale of several billion US dollars, exceeding Binance. This moment means that the era in which large centralized exchanges dominated the trading direction has begun to be changed by decentralized trading platforms. This is the future that many people in the currency circle dreamed of in the last bull market.

In this bull market, Solana will become the dominant platform. The new capital inflow of Ethereum mainnet will not be greater than Solana. Of course, it does not mean that Solana will surpass Ethereum as a whole in the future, but it is just that the growth rate and even scale of capital inflow in this year's bull market have surpassed Ethereum. The best outcome in the future is that Solana will be the L2 of Ethereum, and Ethereum will exist as the expansion of Bitcoin. This is an evolutionary logic.

Although many people are reluctant to admit it, the Ethereum mainnet is actually unable to bring huge increments for the time being, but at this time L2 has not grown up and cannot bear the power of the Ethereum mainnet.

Originally, Arbitrum has the potential to bear the power of the Ethereum mainnet, but the mainstream of Ethereum does not seem to recognize Arbitrum, and the flourishing of L2 is inevitable, so countless competitors will emerge. The most powerful competitor L2 is like the smart chain in history. It needs a strong centralized traffic platform as a background. Therefore, if Arbitrum does not find a centralized large traffic platform like the historical smart chain/Binance as a backing, it will gradually lose its first-mover advantage.

Base can be considered as an analogy to the smart chain in history. The overall trend is that the users of Ethereum mainnet will migrate to base as a whole, and this process will take at least a year. Arbitrum should be more global, spread all over the world, and neutral. The main users on facet are domestic. Smart Chain should have the largest proportion of Chinese users, and there are also global users, spread all over the world. Smart Chain is definitely a thing of the past. Base users are almost the same type as Smart Chain, with the endorsement of large centralized exchanges, but they are dominated by overseas, but there are still many Chinese people. This is because it is all migrated by the original Ethereum bigwigs, and these KOLs have driven the Chinese to go there in batches.

Basically, it can be considered that Base will be the overall migration of Ethereum mainnet users in the future.

The users on Base are not as neutral as arbitrum. Because there is no strong centralized traffic platform as a backing, and there is no strong KOL to drive it, Arbitrum has become a neutral platform, the users are global, there is no special extreme distribution, and it is more neutral than Base and Smart Chain. It needs to find unique advantages to become the third pole.

Other blockchain networks basically don’t need to be considered and studied during the bull market (they can be studied in the bear market), including the TON chain, which is far away from the main continent. Other blockchain networks are marginal platforms, including BTC L2.

The bull market is the influx of new people and new money outside the currency circle, rather than the involution of old people and old money within the currency circle. The logic of the bull market is definitely different from that of the bear market, but the market is still full of a large number of the past involution patterns. Here is a judgment that the next SHIB cannot appear on the smart chain and base (because it is still the old involution pattern), but it is possible on solana, and Ethereum L2 is possible (but it will not appear on base, which is beyond V God’s expectations, and the outbreak of meme itself is beyond V God’s expectations). The bull market is the time to overturn the table.

The new bull market is also the best time for all small projects, unknown projects, and brand new projects. Seizing the opportunity may make them rise. Several projects that exploded in the last bull market, such as Uniswap, Axie, Opensea, and Boring Ape, were originally small projects, unknown projects, and brand-new projects, and they all seized the opportunity. The bull market itself means that new traffic is greater than old traffic, and new capital is greater than old capital. The essence of the bull market is subversion.

Every bull market is a paradigm revolution for the siphoning of users and capital outside the currency circle. The original involutionary currency circle's showmanship was overwhelmed by the new paradigm of simple, rough and barbaric growth. Both the speed and scale of capital inflow are incomparable to the past. For example, the outbreak of 1C0 has an impact on the original Bitcoin imitation disk; the outbreak of DeFi summer has an impact on the original large number of imitation disks that claim to surpass Ethereum public chain; this year, there has been a simple and barbaric outbreak of meme coins, which has an impact on the original large number of value coins. The market value of WIF has exceeded the market value of ARB, the leader of L2.

Every bull market is a reshuffle, a process of outsiders rushing into the circle, and a process of newcomers washing out the old ones. The old people seem to be very "smart", very knowledgeable, and very "cunning", but most of them will still be washed away. In the frenzy of the new bull market, intelligence is not as good as the power of the trend.

In the face of the big trend, all the cleverness is just a trick.

The crypto projects that can develop into large market capitalization have now tended to two extremes. One extreme is that infrastructure projects require heavy investment, which requires VC; the other extreme is that community-driven projects do not need to invest too much money to build contracts, which does not require VC.

American financial lawyer Scott Johnsson tweeted that the spot Ethereum ETF will be rejected by the SEC next month, and there is a high probability that there will be no approval later this year. I think if the ETH ETF can pass, then the third cryptocurrency ETF may be a meme coin. If the ETH ETF cannot pass, then a certain meme coin ETF may also pass, because large-cap meme coins are community-driven and have no VC reserved.

Nvidia's stock price has fallen 20% from its all-time high a month ago. Since March 8, the market value has evaporated by as much as $400 billion. The stock market and the cryptocurrency market are now in sync, and the cryptocurrency market even seems to be a few days ahead of schedule, which is different from the early stage of the last bull market. March 12 also happened during the rising period of 2020. It is amazing to find that there must be a big drop before the halving, otherwise it will be a shame to this rule.

The market is always right.

In every bull market, there will inevitably be a coin that makes many people rich. This is also the characteristic of the bull market. The original inertial cognition in the cryptocurrency circle was to pursue projects with technical content and look down on memes without technical content, but this year's bull market has reversed this cognition, and memes have become the theme of this year's bull market. The market value of WIF has exceeded ARB. In the past, people only focused on useful uses and not useless uses, but in fact, it may be useless uses that drive huge progress.

Bitcoin has not been halved yet. The current bull market of no takeover is actually the middle turning point in the more than 1,000-day rising period. Before Bitcoin reached its highest point on March 11, it was called a bear market, and after March 11, it was called a bull market.

The main reason for the meme carnival this year is the overflow of retail meme investors in the US stock market into the currency circle. Whether it rises or falls, the scale of meme coin transactions is extremely large, but they are not interested in other so-called value coins, causing the currency circle funds to turn around and "follow" them. This is different from the past when the outsiders chased the insiders. Now it has become the insiders chasing the outsiders. This will cause the originally well-known major large-cap tokens to be sucked by memes and cannot rise.

The popular meme coins all have the characteristics of fair issuance, community-driven, based on the emerging ecology (such as SHIB based on the uniswap of the Ethereum mainnet in 2020), and large issuance volume (the total amount of Dogecoin is more than 100 billion, and SHIB is a trillion-level total amount).

The founder of BOME can now be seen as the AC in the last bull market, both of whom are pioneers in the early stage of a new bull market. Most people's cognition may still remain in the realm of technology, such as chasing after people like the AC in the last round. But the theme of this year's bull market is no longer decentralized applications, but meme, which is not useful, but "useless". From this perspective, the founder of BOME can also be considered the AC of this year's bull market.

The trend of this round of bull market is to de-VC, so community-driven and meme have become the dominant forces in this year's bull market. The KOL round has become a popular model this year. According to ChainCatcher, Web3 asset data platform RootData released statistics on KOL's participation in project financing in the past six months on social platforms, among which dingaling ranked first with participation in 21 project financings. In addition, Gmoney and DCF GOD ranked 2nd and 3rd respectively.

New technologies, new assets, and new narratives are suitable for appearing in bear markets, spreading from small to large, and finally becoming popular. However, in bull markets, inflows are dominated by new people and new money, and people are chasing new assets with greater liquidity and strength. This year's bull market is meme coins, and new technology-driven projects will not be as popular as in bear markets. I even judge that the upcoming runes will not be as popular as BRC20 last year. Some people discuss and play because it is famous, but there is no money chasing it.

For example, in 2020, the summer of DeFi emerged, and a new paradigm of decentralized liquidity siphoned traditional capital, which lasted until the first half of 2021. However, in the second half of the year, this new paradigm was too crazy and insufficient liquidity appeared, but funds still needed new hype targets, so they moved to small pictures with relatively weaker liquidity, and the summer of NFT appeared. Further development, there was a liquidity collapse in 2022, and a complete bear market.

Last year was only the first half of the overall recovery of the market, but it was still in a bear market. I think the bull market is based on the period before and after Bitcoin surpassed its historical high. There was a bear market before and a bull market after. The previous rising period is the accumulation process of the early stage of the real bull market later, but it cannot be called a bull market. In the accumulation process of the first half of this rise, there are often innovations that last for a long time, such as the summer of DeFi and the inscription fever.

If we cut the boat to find the sword, now is actually only January 2021, that is, one month after Bitcoin reached its historical high. The key to that round of bull market is actually the subsequent January to May 2021, especially January of that year, which is a turning point. Before that, the market value of many large altcoins continued with the previous inertia, but at the end of January, there was a shocking reversal, such as Dogecoin reaching a scale of tens of billions of US dollars, and SHIB suddenly soared ten thousand times from an inconspicuous scale, so the next May of this year is the highlight of this year's bull market.

At present, the amount of Bitcoin buying and meme buying that has already happened has far exceeded the amount of funds when Bitcoin reached its highest point in December 2020. At that time, there were algorithmic stablecoin innovation projects in December, which were mainly concentrated at the end of December of that year. This year, the types of innovation that broke out are BOME and imitation disks.

At that time, the algorithm stablecoin was also very popular and extinguished very quickly. I think the scale of BOME and imitation disks is slightly larger than that of the algorithm stablecoin at that time, and it is extinguished very quickly. The current BOME and imitation disks can reach a daily trading volume of more than 3 billion US dollars for one coin. This scale was not achieved by the algorithm stablecoin back then. Compared with the previous algorithm stablecoin, this year's meme innovation has degenerated from the perspective of encryption technology, but from the perspective of large-scale adoption, it may be a new trend and a new direction, because for newcomers to the currency circle, they hate complex theories and do not need to listen to complex technologies. Memes can more easily attract newcomers to adopt on a large scale.

In a bear market, we build, and in a bull market, we pull the market. Therefore, we have seen that SOL has continued to soar in the past two years, and Solana will indeed do it. A man of insight is a hero. It is too late to build in a bull market. In a bull market, we need to pull the market and FOMO. This year's bull market has reached the extreme, that is, meme. BTC is FOMO by large institutions, and meme is FOMO by retail investors.

Meme is mainly achieved by pushing up a public sentiment and gradually reaching a consensus. The gameplay is also very simple, and there is no need to understand the technology. Super memes often appear after Bitcoin exceeds its historical high. For example, after December 16, 2020, the last round of bull market, SHIB began its journey from zero to tens of billions of market value. The focus of meme is public sentiment and chasing hot spots. Of course, SHIB is riding on the hot spots of Dogecoin. There is nothing wrong with chasing hot spots. Meme is not technical brainwashing. Anything that is technically brainwashing cannot be called meme. Only community-driven tokens with public sentiment are meme coins. Meme is not only a kind of public sentiment in image, a kind of public sentiment in language, a kind of public sentiment in symbol, but also a public sentiment of capital betting. It is the accumulation of capital inflow from small to large that reaches the public sentiment of capital betting, which turns the popular FOMO into meme FOMO. FOMO itself is a meme. When hot spots appear, public sentiment appears, FOMO appears, and memes are born.

In every bull market, there are new forces entering the currency circle, and the dominant force of this year's bull market is the influx of retail investors in the US stock market, so there is a meme craze, which is also the origin of the trend of de-VC. In this bull market, it is very likely that all VC coins will be sucked blood by the new meme forces.

BOME is the first iconic project of this bull market and the COMP of this year's bull market. In other words, BOME fired the first shot of the new bull market, just like COMP fired the first shot of the previous bull market in 2020. Those VC projects that were popular before BOME cannot meet this standard. They are all the legacy of the previous bull market. BOME is just a trigger for a bull market, and its role is similar to COMP in the past. Later, there will be YFI, SUSHI, and UNI.

In this year's bull market, Solana meme may suck the blood of other large-scale altcoins and turn it into a meme carnival. The leading factor of this year's bull market is "de-VCization" and community-driven. Perhaps all other VC projects in this year's bull market will not bring satisfactory returns, but are actually sucked by memes. Now even V God and AC have to study memes. This is a bull market with only meme carnivals, and at most other community-driven projects with broad memes, such as ordi and eths.

The theme of this year's bull market is community-driven, not VC-driven. "De-VCization" is the main line of this year's bull market. Even institutions are chasing community-driven, not retail investors chasing VC coins. This trend is very good. Whether it is against the trend or with the trend will be reflected in the returns. The essence of capital flow lies in "demand" rather than supply. Where there is a grand narrative, where there is a wealth effect, where capital efficiency can be improved, where there is hot money, there is demand.

Bitcoin is community-driven, Ethereum is VC-driven. Meme coins are community-driven, and almost all infrastructure is VC-driven. We cannot look down on meme coins, nor can we deny VC-driven, but every bull market has its own theme, and there seems to be a bull-bear cycle with alternating themes. When infrastructure or technology applications do not make much progress, meme coins will become dominant.

The market itself is the smartest.

It cannot be said that community-driven will not go through multiple bull-bear cycles. In fact, Bitcoin is community-driven, Ethereum is VC-driven. Meme coins are community-driven, and almost all infrastructure is VC-driven. We cannot look down on meme coins, nor can we deny VC-driven, but every bull market has its own theme, and there seems to be a bull-bear cycle with alternating themes.

In the early stage of the bull market, the dominant force has become external capital inflows, not the old people in the currency circle. Whoever can grasp the emotions of external inflows can dominate the direction. Now the logic has changed, and it cannot be analyzed and developed according to the original thinking. Just like SHIB in the last bull market began to pull up the dominant funds, my judgment is that it should not be from the original currency circle, and the same is true for BOME this year. Of course, those who follow the rise must be from the currency circle. The bull market is to siphon external traffic. The bull market is originally a process of siphoning external traffic, which is a very short process for the total number of users in the currency circle to increase again. The users who settle down are the old users of the next round of bull market, and they also become users of the currency circle.

Some of the original old people in the currency circle cannot adapt to this change, and even FUD newly born projects, especially meme coins. In fact, the logic has changed, but he still thinks in the same way as before. In the new bull market, the dominant force must be external capital inflows, and the scale is very large. The pity of Worldcoin is that it is a VC-driven coin. If Worldcoin is 100% community-driven, it will be the most perfect AI meme coin and will become the Dogecoin of this year's bull market. Worldcoin attracted external funds some time ago. The external funds raised the price and stimulated the people in the coin circle. It depends on the source of the increase. But Worldcoin is not community-driven and it is not easy to become a meme. This is its problem.

A new bull market and a new paradigm do not matter if the old people in the coin circle recognize it, because it is not the people in the coin circle who dominate the inflow of capital. The new paradigm is not necessarily a great technology. Any new ideas, new methods, and new models that stimulate the inflow outside the coin circle can be called a new paradigm once they emerge in batches.

The emergence of BOME proves that the new bull market, new meme, and new paradigm have exploded. The recognition and attitude of the old people in the currency circle are no longer important. Only the imitation of BOME needs the recognition and attitude of the people in the currency circle. It seems that overnight, before the people in the currency circle can catch up, the market value has exceeded 1 billion. This is the emergence. More importantly, the external has reached the critical point of emergence, while the internal is its own gene to activate external emotions. The trading volume of meme coins exceeded 80 billion US dollars that week. The external environment has been very intense. The main buying volume should be driven by retail investors in the US stock market. Community-driven and de-VC are the themes of this year's bull market. In the new bull market, meme outbreaks and community-driven paradigm emergence. The new bull market is the intersection of the US stock meme craze and the crypto community drive. The speed and scale of the emergence of the new bull market and the new paradigm will be unimaginable in the previous crypto community. The trading volume can reach billions of US dollars on the day of its birth.

In the race between the tortoise and the hare, 99.99% of the people in the world will chase the hare and will not bet on the tortoise, but the ending is often unexpected. Instead, the least favored tortoise becomes the winner.

Why do projects that are very popular at the beginning often become mediocre in the end, and why do projects that develop like the tortoise at the beginning suddenly surpass the hare in the end? For popular projects, the community gathers quickly and does not form enough cohesion. Often, it becomes a mess because the heat disappears. Therefore, it is normal to return to mediocrity or even zero. Entropy increase is the norm for all things in the universe. Why do these popular projects become mediocre in the end? It is because there is no cohesive group of large investors. Often, most projects return to zero, which is actually the result of large investors selling off. Large investors decide the life and death of a project. Of course, there are also projects that turn defeat into victory. For example, SOL is like this. In the last wave in 2022, SOL was smashed to a little more than $10. Large investors dumped the market and stopped playing. But new people came in and became the cornerstone of SOL. SOL is alive again. It is conceivable that the solana project team would not smash SOL at that time. It was the big investors who really smashed it. In fact, most projects are like this. What determines life and death is whether the big investors have cohesion and form a stable group of giant whales. Kevin Kelly said that the first kind of AI is called artificial aliens. AI is like an alien that has descended on Earth, but it is designed and programmed by humans, and may exceed human intelligence and may also have cognition. But the most important point is that they are not like humans. They are silicon-based creatures with different cognition and thinking styles. The difference in thinking styles may constitute the biggest difference between AI and humans. This is not a mistake, but a feature, or even an advantage. They may have creative thinking and make decisions with completely different thinking from humans. As technology advances, we should switch our cognition. Artificial intelligence may indeed become an "alternative alien". They are different from carbon-based entropy reduction life, but silicon-based entropy reduction. This silicon-based entropy reduction is an extension of human entropy reduction ability and the evolution of the universe's entropy reduction. It is understandable that artificial intelligence will replace humans one day, and we should perhaps switch our cognition. In other words, in the future, artificial intelligence power equipment may completely replace humans, and no longer need humans to input information and energy to them. They can obtain energy and information by themselves, just like the carbon-based life on our earth, so that they can go to the moon, Mars, and any place they can reach to survive and evolve independently. This may also be an upgraded version of the evolution of carbon-based life. After carbon-based life no longer exists, silicon-based life will replace carbon-based life and continue to evolve.

Earth life may have originally been an alien. Now amino acids can be artificially synthesized, but it seems difficult to synthesize from amino acids to RNA artificially. I guess this process may have been synthesized in the universe and brought to Earth, and Earth is just right for RNA replication, diffusion and evolution, until DNA and then to today's Earth life. The probability of having life as intelligent as humans on Earth in the universe is extremely low, and the transition from carbon-based life to silicon-based entropy reduction (non-naturally formed silicon-based life) can actually be considered an upgraded continuation of the entire entropy reduction system, which is in line with the birth of RNA material in the universe and brought to Earth, and is the continuation and evolution of entropy reduction in the universe.

Satoshi Nakamoto is equivalent to Copernicus in history, revealing a new cognition, and even developing a new cognitive paradigm that will be the mainstream of future humans, just like the "scientific paradigm" cognitive evolution path from Copernicus to Galileo to Newton, Maxwell, and Einstein, and its significance will affect humans for hundreds of years to come.