1. The core reasons for the current downturn

1. Liquidity exhaustion

High interest rate suppression: The current interest rate of the Federal Reserve of 4.25-4.5% is still far higher than the neutral interest rate (2.5-3%), which inhibits market expansion.

Balance sheet reduction: The Federal Reserve has reduced its balance sheet by nearly 2 trillion US dollars, directly compressing market liquidity, leaving only Bitcoin ETF funds to support BTC and some old mainstream coins (XRP, LTC, etc.).

Flood of altcoins: CoinMarketCap includes more than 11 million tokens, far more than the total of global stock markets, and funds are extremely dispersed, making it more difficult to pull the market.

2. Market chaos intensifies

Trump and other politicians and celebrities use the currency circle as a "cash machine", overdrawing liquidity, flooding with inferior projects, and damaging industry trust.

2. Key signals for the restart of the bull market

1. The Fed restarts the interest rate cut cycle

2. The Fed stops shrinking its balance sheet and turns to expanding it

3. Prerequisites for the outbreak of the copycat season

1. The Fed's interest rate drops below 3%

2. The Fed's large-scale expansion of its balance sheet releases liquidity