Reflecting on the cyclical changes of this round of cryptocurrency bull market, how to formulate an effective selling strategy?

Author: Finish, Crypto KOL

Source: Finish X account

Compiled by: Felix, PANews

This cycle has been extremely difficult, worse than any previous cycle. Many people even refer to it as the "crime cycle," as the number of scams and rug pulls has been increasing.

The purpose of this article is to reflect on the past and attempt to predict what will happen next.

The Birth of Pump.Fun

On January 19, 2024, Pump.fun was born, changing the landscape of meme tokens forever. Regardless of age, profession, or nationality, everyone had the opportunity to issue tokens.

At that time, the hype was not very strong, but eventually, in March of last year, with the emergence of tokens like MICHI and FWOG, Pump.fun began to rise. Almost anyone could publish a meme in seconds, which transformed the entire crypto space.

By bundling many tokens, Pump.fun provided a fair opportunity for release without insider dumping. While it seemed promising, it also charged substantial fees.

Since its launch, Pump.fun has profited over 2.86 million SOL, approximately $577 million. It may be one of the most successful startups in history.

This liquidity has been permanently extracted and pocketed by the Pump.fun developers, which is one of the key reasons that makes this cycle different.

Bitcoin Halving

Next is one of the most critical moments in the current cycle. On April 20 of last year, the reward for mining BTC blocks was reduced from 6.25 to 3.125. With the first ETF approved on January 10, many believed the halving would be a "sell the news" event, but instead, a new ATH emerged.

ETF + Bitcoin halving is the most bullish setup, as many have been waiting for institutional liquidity to start flowing in, which is exactly what happened afterward. Fidelity, BlackRock, and MicroStrategy have been buying daily, injecting more and more liquidity into the market.

This gave traders hope. Many traders thought this cycle would be similar to the last one, but this time, everything was different. The market's direction seemed to always be contrary to the "crowd."

What You Expect is Your Problem

Looking back at the cycles of 2017 and 2021, these two cycles were actually very similar. Making money was not difficult, nor did it require any special knowledge. At that time, there were 10-20 altcoins that everyone knew and was hoarding.

First, BTC rose, followed by ETH as the beta play of the cycle, usually offering higher returns. Then the transition from ETH to altcoins, from high market cap coins to low market cap coins.

This is why many people decided to skip the BTC phase in 2024 and go straight into ETH or altcoins. If ETH can rise 5 times, and large altcoins can even rise 10 times, why wait for BTC's 2-3 times return?

The logic is simple; however, the "crowd" did not consider that this cycle might be different. The number of projects, tokens, and memes is hundreds of times greater than before, and people are buying familiar tokens like DOT, ATOM, ADA, expecting 10x returns.

It turns out that when liquidity shifts to altcoins, due to the overwhelming number of altcoins, especially the influx of new ones, all the old altcoins get left behind.

Scams Are Different Compared to 2021

Crypto KOL OverDose mentioned a reasonable point. In 2021, to "rug," scammers were very creative, and as long as users were not too greedy, they could pull back from the cliff.

• Do Kwon's Terra $LUNA
• Sam Fried's FTX
• 3AC had long-term investments before the collapse
• Alameda pushed different narratives and manipulated the market

Scamming was difficult and required a certain level of intelligence, whereas now it simply leverages celebrities, influencers, and even presidents to promote their junk projects.

Players have become accustomed to gambling, starting to feel FOMO over TRUMP and MELANIA, and wanting to make money on CAR or LIBRA, resulting in heavy losses.

Individuals know of 10-15 excellent traders who heavily invested in LIBRA (up to $1 million), while insiders dumped over $100 million on them.

It's Time for Change

It's time to understand that cycles will never be the same; altcoins are not just the "beta version" of BTC or ETH; they are a completely different niche market with more risks and opportunities.

You cannot expect DOT or ATOM to rise just because BTC broke its all-time high in 2021.

There is no doubt that I still have faith in BTC and believe it will continue to be one of the best compounding assets in the next 10-20 years, but the returns will be similar to stocks, and achieving a 200% annual growth rate will no longer be easy.

The main lessons you need to learn from this cycle are:

• Simply holding is cowardly behavior; if you do not sell at the right time, you will face losses. Murad has been advocating for holding, and since the ATH, almost all his memes have dropped by 80-90%.
• You need to formulate a strategy for when to sell. This may sound harsh, but that's how the market works; you need to have a specific exit strategy before trading.
• Narrative rotation. Recently, there has been a crazy rotation from memes to AI agents to TRUMP, etc. If you fall behind at any time, most of your gains may be wiped out. Always follow the narrative and remember that liquidity is limited.
• Timeliness is better than being early. Don’t overthink it; rotate when the timing is right.
• No matter how much you believe in the protocol, ensure stable profits and continuously accumulate Bitcoin, as Bitcoin still offers better opportunities than most stocks or real estate.

I hope this cycle is not over yet, and the current BTC consolidation will determine what happens in the next 2-3 months.