Yesterday, BNB first surpassed $800, and its total market capitalization broke 110 billion. The bull predicted five years ago seems to have come true today. On July 25, 2020, I first wrote about my long-term view on BNB in a public account, the article was titled 'BNB on the path to a $100 billion market cap' (can be found in WeChat), at that time, the price of BNB was $18, and the total market cap was 2.7 billion. I later wrote a few articles supplementing the logic of a long-term view on a $100 billion market cap. In the bull market of 2021, BNB's total market cap exceeded 90 billion but did not reach 100 billion; this year it has officially broken through. Looking back now, some of the logic has been validated, and some have been falsified, but overall it can be considered a successful prediction. Writing this article serves as a conclusion to the prediction made five years ago!
How will the market trend downwards? Actually, there is no need to predict anymore, as the market has already made it clear. Why do I say this?
From a macro perspective, the current environment of the crypto industry (especially in terms of regulations and policies) is completely different from previous rounds, almost a 180-degree turnaround (in the U.S.). 'Bitcoin' + 'stablecoins' have become part of the U.S. national strategy. In particular, various capital is entering the Bitcoin market through ETFs, and the government is promoting stablecoin legislation. Trump said he wants crypto innovation to happen in the U.S., and it's not just a slogan; they are serious. The policy ceiling that once blocked the industry has basically disappeared, and U.S. policies have become incredibly friendly to the entire crypto industry.
In this macro background, the crypto market is increasingly aligning with traditional financial markets (U.S. stock market), with price fluctuations showing a strong correlation to U.S. stocks. The size of the crypto market is growing, and the main factor influencing price changes has become the tidal cycles of the U.S. dollar. The impact of the four-year halving cycle on prices is becoming secondary. If the U.S. stock market experiences a long bull run, so will crypto. Crypto even shows stronger resilience than the stock market.
At the same time, the structure of the crypto market will also develop in the direction of the U.S. stock market, leading to severe market differentiation. Large-cap assets will become increasingly strong, forming a winner-takes-all effect similar to the MAG7 in the U.S. stock market (the seven companies with the largest market capitalization, strongest growth, and prominent technology attributes, including Apple, Microsoft, Nvidia, Meta, Google, Tesla, and Amazon). Occasionally, one or two star small assets may emerge in some new fields, experiencing short-term surges that may be driven by memes or other narratives, which cannot be predicted.