Judgment on the Current Cryptocurrency Market Cycle

Core Conclusion

We are still in the early stages of a new bull market, with some distance to go before a real explosive rise (and the subsequent bear market) occurs. The judgment is based on the following five points:

1. No Systemic Crashes Have Occurred

The last bull-to-bear turning point was accompanied by the collapse of high-leverage giants like Luna, 3AC, and FTX. Thus far in this cycle, we have only seen sporadic hacking incidents with limited financial involvement, and there has been no chain reaction collapse similar to a "massive deleveraging." Without deep crashes, there is a lack of catalysts to lead the overall market to deleverage and shift sentiment completely to a bearish phase.

2. Leverage Expansion is Still in the "Testing Phase"

Currently, while derivative positions and on-chain lending are increasing, both institutional and retail investors remain relatively restrained, far from the point of "going all in" and doubling down. As long as the total leverage is under control, the momentum of the bull market will not be quickly countered.

3. The Dominant Force in This Cycle is "Sovereign and Pension Capital"

Past cycles were often led by star companies or family offices; this time, the narrative is that governments are incorporating Bitcoin into their reserves, driving sovereign funds, pension funds, and other deep-pocket institutions to enter the market. These funds are large in scale and have long holding periods, pushing Bitcoin prices towards $150,000–$200,000, setting the stage for subsequent retail FOMO.

4. The "Second Wave" of Retail and DeFi Leverage Has Yet to Arrive

Only after government and institutional support is established will retail sentiment truly ignite, with significant funds leveraging through DeFi protocols, entering a credit expansion cycle. That will mark the acceleration phase of the "explosive bull market" and the stage where risks accumulate the fastest.

5. Future Bear Market Sign: High Internal Leverage + Chain Reactions

We need to be cautious of high-leverage chain reactions occurring on-chain or on centralized platforms—once a single point of failure at the level of Luna/FTX emerges and spreads quickly, it indicates that the top has been reached. Currently, we have not observed any signs of such risks, so it is too early to say that "the bear market has arrived."