Bottom fishing, bottom fishing, when is the bottom?
Before the 1.5 billion USD of ETH was stolen from Bybit, the price of ETH was around 2800 USD, and after the theft, due to the constant changes in Trump's tariff policies, the overall market declined.
Overall, Bitcoin has fallen more than 10% to date, and at its peak, it was only over 20%, but almost everyone is confident in its return to previous highs.
However, Ethereum did not rebound as expected after the hacker's sell-off; instead, it fell below 2000, reaching a low of 1700 USD in less than half a month, with a decline of nearly 40%.
Since the beginning of 2023, even during the pullback, Bitcoin has risen from 25,000 USD to the current 81,700 USD.
Ethereum was at 1700 at the beginning of 2023 and is still at 1700 now.
For long-term holders, this is a torment because they missed the entire bull market.
For short-term investors like me, it remains confusing because veterans have failed by bottom fishing, and during Ethereum's decline, bottom fishing has led to the loss of the bull market's gains.
Such a situation inevitably raises doubts about whether Ethereum is really useless.
There are only two scenarios: one is that Ethereum is truly useless and abandoned by capital. The other is that capital thinks the previous price was too high and needs lower chips, estimating suppression and shorting, while clearing the bottom leverage and brewing the next bull market.
I believe the second scenario is more likely.
First of all, regardless of how well Ethereum's competitors develop, the overall recognition and scale of the entire ecosystem in front of Ethereum is still enormous and well-established.
For instance, SOL mainly revolves around on-chain MEME this round, while other sectors like DEFI and NFT have not developed well.
Furthermore, Ethereum has passed the ETF and has already become a semi-mainstream asset recognized globally.
Moreover, despite Grayscale selling over a million Ethereum, it still holds nearly 2 million and is also applying for ETH staking.
BlackRock has recently sold some, but in total, it has bought 1.25 million coins, accounting for 1% of the total ETH, and most of the purchases were above 2500 USD, with very few sales above 3000.
From the perspective of ETFs, Ethereum might be experiencing a situation similar to Bitcoin from April to October last year, namely price suppression, accumulation, sufficient turnover, washing out early low-priced holders; if this is the case, Ethereum may undergo a period of stagnation because capital accumulation takes a long time.
The two potential biggest positives for Ethereum right now are: the SEC opening up ETH staking and the upgrade in April.
Whether ETH staking can gain approval is somewhat uncertain because during the tenure of the former SEC chair, he believed ETH was not a security, but the staked ETH is a security.
But now there has been a change; from the recent news, Ethereum's ETF staking has a great possibility of being approved.
A few days ago, Utah state in the US passed a cryptocurrency-related bill, mentioning the rights to mine, operate nodes, and stake.
Recently, the Chicago Options Exchange also submitted a proposed rule change to the SEC to allow Franklin Ethereum ETF to conduct staking.
Open staking is potentially the biggest positive for ETH, in addition to benefiting DEFI and staking. The second benefit is the upgrade in April.
Additionally, analyzing from a macro perspective.
The US debt is currently Trump's biggest headache.
To resolve the US debt, the dollar cannot appreciate, interest rates must also be cut, the economy must grow significantly, inflation is almost inevitable, and the US stock market cannot collapse.
I said that the US stock market cannot collapse too severely under the depreciation of the dollar because if the stock market collapses, the dollar depreciates, and inflation occurs simultaneously, and excessively severe, the US will fall into a systemic crisis, which may be worse than past crises.
This is actually full of contradictions; we cannot understand the final solution.
Now, the tariff war that Trump wants to initiate seems quite loud, but it appears a bit like riding a tiger; it keeps changing but always ends up being more noise than actual impact.
For example, last night it was suddenly announced that higher tariffs would be imposed on Canada, and this morning it was canceled.
He is not actually crazy; he is using the news to put pressure on the financial market, the Federal Reserve, and also on other countries globally.
However, one cannot exert equal pressure on other major countries and regions globally; they can only repeatedly target their neighbors, but it is still the initially set tariff policy.
I bet he doesn't dare to impose the same high tariffs globally; that would make him a target.
So in the end, the tariff policy will definitely be 'relatively mild'; the surface pressure must still be applied, interest rates cut, liquidity injected, and then domestic manufacturing, finance, and technology must be revitalized to solve the debt and inflation issues.
The Fed's approach is actually quite similar; on the surface, it maintains a hawkish stance on interest rate cuts, but due to various domestic pressures, it is possible to cut rates three times this year, or even cut early.
In addition, the general expectation for March is that interest rates will not be cut. Tonight's CPI data may be quite important; if the data supports an earlier rate cut, the probability of a cut on March 20 will increase, which may ease the crypto market conditions, but it's still hard to have a major bull run, after all, Trump is still causing disturbances, and institutions need time to accumulate.
If there is no interest rate cut in March, and if Trump does not stir trouble and the market does not manipulate, Bitcoin is likely to fluctuate around 2000 points, which is not a significant bearish signal.
Overall, compared to the constantly depreciating US dollar, high-priced precious metals, oil, and US stocks, cryptocurrencies are expected to take over as the next speculation opportunity after the Fed lowers interest rates and injects liquidity.
In this round, the crypto market has dropped the historical decline that might have taken one to two years within three months, breaking the bull-bear law; the future crypto market will be more violent, with steep drops and rapid increases.
The views in this article merely represent personal opinions; market trends can change dramatically, so please judge for yourself.
That's all for today. During the bull market phase, many people hope to have a discussion; if you really can't manage in the crypto circle, don't force yourself, come and find me to learn (see my profile), keep up with the latest news, make arrangements, embrace the bull market, improve your win rate, and say goodbye to being stuck at high positions.