I believe Bitcoin is the largest collectible in the crypto ecosystem. This type of collectible should benefit the most from the prosperity of the crypto ecosystem, leading to value spillover—this is the healthiest and most sustainable driving factor.
However, in this round of movement, due to the lack of refreshing and sustainable innovations and applications in the crypto ecosystem, Bitcoin's current rise is basically not derived from the value spillover of the crypto ecosystem, but rather from the bullish sentiment of traditional financial capital (especially the financial capital led by Wall Street).
This bullish sentiment is also clearly positively correlated with risk assets (the most typical being US stocks).
I don't see this positive correlation having any significant changes in the short term (at least in the second half of the year).
Therefore, if the crypto ecosystem does not see any disruptive and sustainable innovative applications and business models in the second half of the year, it is likely that Bitcoin's performance will still be strongly influenced by the US stock market.
Judging the performance of the US stock market in the second half of the year is more complicated.
On one hand, the current US stock market is definitely not cheap. This market has been rising almost continuously for 17 years since the financial crisis of 2008. Such a long and strong bull market is rare in American history.
Can such a market continue to rise forever?
Impossible.
I have always believed in a common sense: there is no market that only rises without falling. Another myth that runs parallel to the US stock market, but is even longer and stronger than the US stock bull market, the Chinese housing market of 'only rising without falling' has already collapsed, and the aftermath is tragic.
Common sense has no exceptions.
But on the other hand, it cannot be said that it has a huge bubble, because the seven giants driving the strong growth of the US stock market now have clear performance support, so their fundamentals remain solid.
So this market is very strange. But the more it is like this, the more I feel this market is dangerous—it has the potential to fall at any time, but it is difficult to determine when it will fall.
However, once the US stock market enters a bear market, Bitcoin is also likely to see a significant decline.
Additionally, Bitcoin's performance in this round of market is significantly different from the past:
In past movements, once Bitcoin's drop from its peak exceeds 20%, it directly enters a bear market and then lingers at the bottom for several years until the next bull market reignites.
However, this time, after Bitcoin reached a new high of over $100,000, despite subsequently falling more than 20% to below $80,000, it miraculously rebounded close to its previous high in just a few months. Such a strong increase occurred without any internal driving force in the crypto ecosystem, relying purely on the sentiment of the US stock market.
In the eyes of many, this is a good sign, but in my view, this is consuming Bitcoin's bullish sentiment.
This bullish sentiment itself is not easy to sustain and last long, coupled with such consumption, how much can support its continued rise in the future?
Therefore, even if the US stock market continues to rise in the second half of the year, I believe that Bitcoin's increase will likely be limited. I really cannot agree with the predictions that it will rise to hundreds of thousands of dollars by the end of this year.
Therefore, I hold a very cautious attitude towards Bitcoin's performance in the second half of the year. Even if it reaches a new high, it is not worth celebrating, let alone being sentimental. Instead, the higher it goes, the more vigilant one should be towards a potential crash. Moreover, I believe there may be a significant drop in the short term.
Of course, if the crypto ecosystem itself can produce miracles in the second half of the year, generating disruptive innovations and applications, then Bitcoin's rise will follow another logic.
