Is the Bitcoin bull market over?

Author: Baihua Blockchain

Since the start of the May Day holiday, Bitcoin has experienced a massive sell-off, with its price dropping from $63,000 to around $56,000 at one point, a maximum decline of over 9% on that day. On May 4, Bitcoin quickly rebounded, with its price approaching $65,000, achieving a daily increase of 9.3%.

In contrast to the dramatic fluctuations of Bitcoin, altcoins have been halved with weak rebounds, and major communities are no longer as lively as they were a few months ago. Has Bitcoin already peaked? Is the bull market over? What opportunities are left for ordinary people?

Baihua Blockchain invited several Crypto KOLs to discuss these topics. The guest speakers include:

• Dashuo (@ruyan768, Technical Advisor at HashGlobal, Founder of CreatorDAO)
• Laobai (@Wuhuoqiu, Research Partner at ABCDE, Research Advisor at Amber Group)
• Natalie (@0xnatalie860, Researcher at ChainFeeds)
• Phyrex (@Phyrex_Ni, Crypto Researcher)

Note: The ranking is in alphabetical order.

1. The recent market is quiet, and some people feel the bull market is over. What do you think?

Dashuo: The bull market for BTC may have entered the mid-stage, but the bull market for Web3 has not yet started. There are many pessimistic sentiments in every bull market.

Laobai: Impossible, the macroeconomic interest rate cuts are just around the corner (in the next 6-10 months), and Bitcoin has just surpassed its previous high; it cannot end now.

Natalie: Due to Bitcoin's sideways movement and the lack of explosive hot narratives, the recent market has almost lost its wealth creation effect, which will gradually dissipate many people's confidence in the market. I always believe that no one can accurately predict market cycles; price stagnation does not necessarily mean the end of the bull market but may be a consolidation phase before the next trend. I remain optimistic about the future.

Phyrex: Based on historical trends, the bull market should not have ended yet, or the real bull market may not have started. In the past, significant price increases occurred during halving cycles. Although the BTC spot ETF has ignited interest early, the upcoming U.S. elections and the implementation of FASB will still help liquidity.

2. Is this market cycle different from previous ones? What do you think are the influencing factors?

Dashuo: The biggest difference is not in funding or narratives but in the mindset of old investors. Many old investors will miss new narratives.

Laobai: There is too little innovation from 0 to 1 and too much micro-innovation. Each project has a market cap of tens of billions, and investors can't keep up, leading to a lack of profit-making effects.

Natalie: Every market cycle has its own trends, and each phase has unique market dynamics. Simply comparing the current situation with past patterns is often not comprehensive enough. This year, the inflow and outflow of Bitcoin spot ETFs have significantly impacted market sentiment and capital flow. Policy factors and macroeconomic fluctuations remain important influencing factors. Within the cryptocurrency ecosystem, I believe changes in the Bitcoin ecosystem may become a pivotal influencing factor in this market cycle.

Phyrex: The biggest difference in this market cycle is the approval of the BTC spot ETF, which has not only boosted confidence but also resulted in a net purchase of over 530,000 BTC within four months, significantly reducing selling pressure on the market.

3. Which sectors and narratives do you see potential in for the next steps in this market cycle?

Dashuo: I am optimistic about the sectors of RWA, AI, social networks, memes, and gaming.

This round of RWA is driven by top institutions, and the on-chain of U.S. Treasury bonds is just the beginning. The scale and variety of traditional assets on-chain will significantly increase in the next 1-2 years.

AI will inevitably require decentralization, as it concerns the fate of humanity, and everyone understands this.

Memes are key to the mass adoption of Web3. While no one understands Web3 technology, everyone has their favorite memes. The last bull market's Opensea allowed many creators to make significant profits, and this round's pumpfun has made creative small images that can generate emotional value more valuable. This is something Web2 cannot achieve. With meme coins, people can collaborate on a large scale with more strangers online.

Laobai: AI, Bitcoin, gaming.

Natalie: Based on macro influences and internal ecosystem developments, I am optimistic about AI, intent narratives, chain abstraction, and Bitcoin infrastructure.

Phyrex: In this round, I still favor the DeFi and RWA sectors, but there are still too few compliant projects focused on 2A and 3A level securities (bonds). Currently, only BlackRock is involved, and it hasn't officially started yet. However, I believe that with the advancement of stablecoin legislation and the improvement of U.S. regulation of the cryptocurrency market, RWA is likely to be the next standout.

4. How do you view Ethereum's performance in the future?

Dashuo: With the launch of Coinbase's Base chain further activating the ecosystem, Ethereum will successfully validate the development path of L2s. This year or next, more enterprises will establish their own L2s, which I believe is more important than the ETH ETF. Ethereum will experience a surge in an independent market when most people are bearish, provided that L2s are preliminarily validated or at least one AVS of Eigenlayer reaches a market cap of $3 billion.

Laobai: Neither hot nor cold; unless the ETF is approved, there won't be a wave of external money coming in. Currently, there is nothing in the ETH narrative worth hyping.

Natalie: Although there are often statements like "XX will flip Ethereum," and Ethereum's trading volume has recently decreased, Ethereum still occupies an unshakeable position in the market and remains a focal point of attention, a starting point for long-term successful narratives. The discussion within the Ethereum community remains vibrant, with various interesting ideas emerging. Recently, I've noticed a lot of discussions around Based rollup, ePBS, and various account abstraction EIPs (Ethereum Improvement Proposals).

Phyrex: It's hard to say about ETH. Whether ZZ is optimistic about the approval of the spot ETF is uncertain, and if the SEC determines that ETH is a security, there will be many subsequent troubles. Of course, this may not happen in the short term. If we look purely at the exchange rate between ETH and BTC, ETH still has opportunities.

5. The current market environment is becoming increasingly unfriendly for ordinary people, especially newcomers. There are too many pitfalls. What advice do you have for new friends?

Dashuo: Stay away from noise, reduce your time on X (Twitter), and use Farcaster as your main source of information.

Laobai: The notion of increasing unfriendliness arises every year; this is a sign of market maturity, similar to the stock market. For newcomers, either buy BTC and ETH for long-term investment or dive deep to become an "expert."

Phyrex: Dollar-cost averaging. Do not add any strategies or leverage; invest in BTC according to a four-year cycle, hoping for good returns.

Natalie: For newcomers, I recommend solidly understanding the basic concepts. With the market sentiment relatively calm and not FOMO-driven, now is a great time to learn. Take advantage of low gas fees to explore on-chain operations and various DeFi strategies.

6. What are your expectations for the future development of the cryptocurrency market, such as this year, one year later, five years later, and ten years later?

Dashuo: I would like to summarize my expectations for the future with a quote from the founder of Coinbase: "onchain is the new online."

Laobai: The market has been in turmoil for ten years, and apart from BTC, it hasn't really broken out. Narratives come and go, and bubbles are burst one after another. My expectation (or hope) is that in 3-5 years, some sector like DeFi, gaming, Depin, or AI will break out and create real commercial value, rather than being almost entirely driven by market sentiment and speculation.

Natalie: People often overestimate the short-term impact of technology while underestimating its long-term effects. No one can predict short-term market changes, but I have always maintained an optimistic attitude toward the long-term development of blockchain since entering the field. In the future, I look forward to seeing more innovative applications focusing on seamless experiences across multiple chains and lower entry barriers.

Phyrex: In the short term, the Federal Reserve has no plans to cut interest rates, which delays the timing of liquidity injections. It is likely that interest rates will not return to low levels and liquidity will not be injected until 2025 and 2026.