Crypto Assets Market Outlook and Trend Analysis

Recently, I had the opportunity to think deeply about the trends in the Crypto Assets market. I believe that the true market direction will only become clear after September. Considering factors such as macroeconomic resistance, summer liquidity constraints, and quarterly position adjustments, market participants will only fully return after the August holidays.

Recent market activities show that the rise of most small coins is mainly due to short squeeze. Traders, influenced by the previous rebound, are chasing short-term trends but lack support from long-term holders. Many tokens experienced sharp increases followed by significant declines.

Ethereum has experienced an unexpected rebound, with sectors such as AI-related tokens, which were previously heavily impacted, leading this wave of recovery. In contrast, tokens with practical use, solid fundamentals, or buyback mechanisms have shown greater resilience, being more stable during downturns and recovering more quickly.

Market Trend Insights

1. Bitcoin demand is solid.

Traditional capital is gradually entering the Bitcoin market through various regulated channels. The nature of the capital supporting Bitcoin is completely different from previous periods, which reduces the likelihood of large-scale liquidation, unless affected by significant macro events.

2. The differentiation of small coins is intensifying.

Funds will ultimately flow back to the small coin market, but it will not expand comprehensively. Only tokens with clear purposes and practical application scenarios can attract these funds. This is also why Ethereum may perform better than other public chains. The clarity of regulation, the increase in decentralized finance usage, the deflationary structure, and staking demand together form a strong positive cycle.

3. Venture-backed tokens face structural risks

Token unlocks will continue to put pressure on prices. In the case of insufficient liquidity, continued selling from validators and early investors limits the upside potential. This makes the outlook for highly valued tokens listed on centralized exchanges unfavorable.

4. The structural advantages of meme coins are weakening.

Meme coins once had structural advantages due to fair distribution, no venture capital unlocks, and other characteristics. However, this phase may be nearing its end. Certain token generation events and the launch of specific coins may mark the peak of attention for meme coins. After that, market interest in such coins begins to wane.

5. Emerging Trends: AI and Crypto Assets Integration

As the hype around meme coins cools down, market attention may shift to new narratives. The combination of artificial intelligence and Crypto Assets could become the next hotspot.

• Many early AI projects failed after the hype, but some projects based on practical applications are quietly developing during the bear market.
• As the profits from meme coins dwindle, investors' attention will naturally shift to new areas. AI, due to its clear practicality, is likely to become the next focus.
• Most AI x Crypto projects adopt a fair issuance model, echoing the market's pursuit of fairness.

Conclusion

Future market opportunities may focus on the intersection of AI and Crypto Assets. Although there is no need to rush into building positions now, if the market rises strongly again, this area may contain the greatest asymmetric opportunities. It is crucial to continuously monitor on-chain market dynamics and seize investment opportunities brought about by information asymmetry.