Trump's election as President of the United States stirred waves in the financial and crypto markets. This marked the beginning of the fourth wave of the cryptocurrency bull market! 1. The first wave of the bull market: 2013
Time: Early 2013 to the end of 2013
Main driving factors: Increased early attention on Bitcoin, with some early users and investors entering the market.
Performance: Bitcoin's price soared from several dozen dollars at the beginning of the year to around $1,000 by the end.
Summary: This wave of the bull market was mainly triggered by the innovative value of Bitcoin, as the market began to recognize the potential of cryptocurrencies. However, the market was relatively small at the time, with high volatility that could easily be influenced by news and events, such as the infamous hack of the Mt. Gox exchange.
2. The second wave of the bull market: 2017
Time: Early 2017 to the end of 2017
Main driving factors: The ICO (Initial Coin Offering) boom and the rise of Ethereum.
Performance: Bitcoin price rose from $1,000 at the beginning of the year to nearly $20,000 by the end; other crypto assets like Ethereum also experienced rapid growth.
Summary: The bull market of 2017 was driven by the widespread application of Ethereum and its smart contract platform, with the ICO boom attracting a large number of investors into the market. A significant number of new projects launched on Ethereum led to broader recognition of the application and value of cryptocurrencies. The market subsequently entered a winter in 2018, mainly due to increased regulatory pressure and the bursting of the bubble.
3. The third wave of the bull market: 2020-2021
Time: Mid 2020 to the end of 2021
Main driving factors: Entry of institutional investors, rise of DeFi (Decentralized Finance) and NFTs (Non-Fungible Tokens).
Performance: Bitcoin price reached a historical high of about $64,000 in April 2021, and again reached about $69,000 by the end of the year. Platforms like Ethereum and Solana also saw significant growth, driving the fields of DeFi and NFTs.
Summary: The bull market from 2020 to 2021 was different from previous ones, marked by the massive influx of institutional capital that brought greater liquidity and stability. Institutional investments and endorsements (like those from Grayscale, MicroStrategy, and Tesla) have led cryptocurrencies to be viewed as a more mainstream asset class. Additionally, DeFi projects brought new vitality to the market, and the explosion of NFTs also boosted the value of digital art and virtual assets.
As the 2024 election concludes, the market's focus shifts back to potential policy changes from Trump and shifts in the global economy. In this context, the cryptocurrency market is also significantly impacted. So, how can we seize opportunities in this wave of the 'crypto boom' and achieve 'takeoff'?
1. Market response: Policy-driven crypto opportunities
During Trump's presidency, tax cuts and financial deregulation were emphasized, while he maintained a relatively conservative attitude towards the global economy. If he is re-elected, these policies could introduce uncertainty in the global economy, thus driving demand for risk-averse assets. Cryptocurrencies, especially Bitcoin, are often seen as 'digital gold' or safe-haven assets, likely to be supported and rise in response to this demand for safety.
Moreover, Trump's relatively pro-business attitude may also create more room for a relaxed policy environment in the crypto sector. Past regulatory policies have deterred some institutions; if new policies reduce regulatory pressure on crypto assets, it will further attract institutional investors, bringing strong capital inflow to the market.
2. Seize technological dividends and invest using market volatility
In times of uncertainty, the volatility of the crypto market is often severe. After Trump's election, uncertainty about future policies may lead to dramatic price fluctuations. However, historical experience shows that such volatility also provides entry opportunities for cryptocurrency investors. For experienced investors, technical analysis and market sentiment indicators can be used to seize short-term opportunities at key support and resistance levels.
At the same time, the rise of DeFi (Decentralized Finance) and NFT (Non-Fungible Tokens) markets also demonstrates strong innovative potential under Trump's policy backdrop. With supportive policies and capital inflow, these segments will have the opportunity to gain more user attention and financial support, becoming the focus of investment allocation.
3. Focus on the direction of the dollar and grasp core assets like Bitcoin.
Trump's election may bring more economic stimulus policies, which could lead to fluctuations in the dollar. Historically, when expectations of dollar depreciation increase, cryptocurrencies like Bitcoin often become a safe-haven choice. In investments, one can pay attention to changes in the dollar index and Bitcoin's performance in times of economic uncertainty, using Bitcoin as a hedging and long-term allocation tool.
4. Closely track policy trends and grasp market sentiment.
Policy direction and market sentiment are particularly important in the crypto market during the Trump era. The market may react quickly due to his 'Twitter governance' style. Therefore, crypto investors should closely follow Trump's policy direction and pay attention to market fluctuations that each policy statement may bring.
After Trump's election, financial market volatility often concentrates in the early stages of his presidency. Thus, initial market trends often show rapid increases and declines. Keeping track of policy direction and observing market sentiment indicators (such as the Fear and Greed Index) can help investors respond rationally to market fluctuations and react in a timely manner.
5. Choose mainstream crypto assets and focus on risk management
Trump's presidency may further drive market volatility, increasing investment risk. Therefore, investors should prioritize mainstream crypto assets like Bitcoin and Ethereum as hedging tools while flexibly allocating some stablecoins to avoid risk. Additionally, diversifying investments and ensuring position management without blindly chasing highs and lows are key strategies for ensuring steady returns.
Standing on the crypto boom, becoming the 'flying pig' is not an overnight success. It requires sharp insight into technology, the wisdom of rational investment, strong networking resources, and patient long-term planning. Only after mastering these core elements can you take off steadily in the boom. To succeed in the crypto field, one must first have a thorough understanding of this market. From Bitcoin to Ethereum, from Decentralized Finance (DeFi) to Non-Fungible Tokens (NFTs), each crypto asset and blockchain project has different underlying logic. Understanding the essence of these technologies and the problems they solve in reality is the first step towards success.