The article is from Talk Li Talk Outside.
Yesterday (January 27), the market fluctuated quite a bit, with Bitcoin dropping to around the lower channel line of $97,750. As of the time of writing, the price has returned above $100,000.
In the past 24 hours alone, 193,697 people were liquidated, with a total liquidation amount of $539 million, mainly long positions.
For those who were liquidated, we can only express our sympathy, but for the market, more liquidations will be healthier. When faced with such volatile market conditions, the panicked continue to panic sell, while the bullish continue to add positions in batches.
This incident seems to have caught many people by surprise. On the eve of the Spring Festival, a domestic large model, DeepSeek, was able to bring a major earthquake to the global financial market, causing the Nasdaq's top 10 tech companies (including giants like Nvidia, Broadcom, and Microsoft) to lose nearly $1 trillion in market value on Monday's opening.
According to popular online accounts, DeepSeek's R&D cost was only $6 million, while ChatGPT's investment was much larger (they raised $17.9 billion for R&D). Under this cost disparity, DeepSeek has already surpassed ChatGPT in recent days, becoming the number one app on the App Store, which has also raised concerns in the US, as China's AI capabilities are developing rapidly with fewer resources, and the efficiency and rapid adoption of DeepSeek highlight the growing threat to the US's technological dominance.
Naturally, the Altcoin market has also been significantly impacted. I've seen people on social media start shouting "bear market" again. Whenever the market drops, these people will shout that BTC will go to $70,000, and whenever it rises, they will shout that BTC will go to $200,000. However, most of the partners in the group seem to have gotten used to this volatile market and are enthusiastically discussing and trying out the new AI dark horse, DeepSeek.
So, is there hope for the market going forward? Can we see a big bull market this year?
In our previous articles, we have expressed a relatively positive view, believing that the crypto market has the opportunity to perform well in the first and second quarters of this year, and the market is still in a bull market phase. As for those who are shouting "bear market", I don't know what they are thinking, as I have never seen BTC consolidating around $100,000 in a bear market.
So far, I believe the overall market trend is still leaning towards a typical bull market, although a typical bull market has never been a straight-line rise. The only thing to note is that as BTC has risen from around $15,000 to around $100,000 in this cycle, the risks it faces may increase going forward, so in addition to maintaining patience, we also need to be extra cautious.
Opportunities are relative - what is an opportunity for some may be higher risk and a trap for others.
These days, I have been receiving some inquiries about Altcoins in the background, and it is clear that some partners are now both anxious and a bit panicked, even a bit of "desperate doctor-shopping". I can understand this, because for those who hold a lot of Altcoins (some have even taken out loans to go "All In" on Altcoins), it is indeed not an easy thing to hold on until now.
For example, one young man put in 1.6 million RMB last year, listened to a KOL's remarks and went "All In" on an Altcoin, and now it has dropped to less than 200,000, and he is unwilling to cut losses and stop the loss, holding on to it is a daily torment...
This young man left a message asking me if there was a quick way to recoup his losses, saying that as long as he could help him recoup, he would quit the crypto world and never play again. But for such cases, I really don't have any instant remedies. In other words, if I could easily turn 200,000 into 1.4 million in the short term, I wouldn't have been stubbornly hoarding BTC all these years, I would have just sold my house to go "All In".
I remember we have repeatedly reminded in our previous articles that the two most important principles for newcomers to this field are: preserve the principal and don't touch what you don't understand.
But the reality is that many people can only understand the meaning of these two simple basic principles after they have paid the "tuition fee" to the market with real gold and silver. Some may understand after losing a few thousand, some may need to lose tens of thousands, and some may simply not understand even after losing everything.
If we look back at the 2021 bull market, we can see that there were at least 3 major corrections before the final parabolic rise of BTC and the Altcoin season.
Each correction was to deleverage and go through a reshuffle, which is the necessary path for the market to rise. It's like riding a roller coaster - to see that brief moment of beauty at the top, you have to get on board and buckle up.
At the same time, we also need to consider our own position size and risk appetite. For someone like me with relatively low risk tolerance, I'm not pursuing the feeling of reaching the absolute peak, although I will also see the price reach $120,000, and I don't oppose the possibility of BTC reaching $150,000 this year, but I will still choose to start releasing my positions when it reaches $100,000.
The feeling of exploring the highest scenery with a cost basis of $100,000 is completely different from the feeling of experiencing even higher scenery with a zero-cost remaining position. I have experienced both, so I now prefer and enjoy the latter's lightness.
Of course, while we used the 2021 bull market as an example, history will not repeat itself, at most it will only be similar. As for how high BTC's price can reach this year and how many major corrections the market will go through before reaching the peak, these are all unknown. Because this year's bull market is fundamentally different from past bull market cycles, and there are still many potential catalysts (key driving factors) that have not been confirmed, such as:
- The issue of crypto regulations in the US
- Which new Altcoin ETFs will be launched this year
- The expectation of Fed rate cuts
- The issue of some countries' potential strategic BTC reserves
- The increase in market liquidity
- The layout of major institutions in the RWA field
- And so on...
The globally viral DeepSeek is just a small incident. For the crypto space, the real upward momentum seems to be brewing, and we need to wait for a new outbreak point, but this process will certainly be tortuous, and we cannot rule out the possibility of a new black swan event directly crashing the market in the future. The best strategy to deal with market volatility is to continue to strictly manage our position size and risk control.
A sentence that Hui Jie said in the group the other day seems very apt: the people in the crypto world are constantly being pulled between hope and despair, persistence and abandonment.
In short, we are still in a bull market, but based on the existing cycle rules, we are absolutely not at the beginning of the bull market cycle, nor at the end of the bull market cycle. As for those KOLs who claim that the bull market has just begun or that we have already entered a bear market, we do not refute them. Everyone has the freedom and right to express their personal views on their own media channels, and it is up to you to decide which view you agree with more.
Here, we still maintain the view expressed in the previous article: in February this year, we may welcome a new round of rebound. If there are no new unexpected (black swan) events, let's continue to welcome Altcoin at $110,000. At that time, I will sell another 10% of my position according to the established plan. (Of course, if I'm wrong, it won't affect me at all. I will strictly follow my own trading discipline and continue to hold the remaining position.)
In addition, yesterday in the group, I also saw a partner share some statistics on Altcoins: the market already has more than 3.64 million crypto tokens, and the creation speed of new tokens is accelerating, and it is expected that the number of crypto tokens will exceed 100 million by 2025, as shown in the figure below.
In comparison, there were less than 3,000 Altcoins in 2017-2018 and less than 500 Altcoins in 2013-2014.
The above is just the variety of tokens. If we also consider the large amount of unlocking of the new projects with high FDV and low circulation born in this cycle, it will lead to two relatively serious problems:
One is oversupply (supply greater than demand)
The other is directly diluting the market liquidity (in the case of already insufficient market liquidity)
The same goes, if you are still hoping for another Altcoin season like the 2021 bull market, where almost everything is crazily soaring, then you are destined to lose more, mainly because of the two points mentioned above. But we still believe that there will be opportunities for an Altcoin season this year, but only a few Altcoins with relatively good fundamentals have the opportunity to reach higher highs (or break through historical highs). As for which areas we are more optimistic about this year, this has been sorted out in the article on January 1st, and interested partners can review the historical articles.
Today is also the Lunar New Year's Eve, and 2025 has already passed about a month. Someone described it as "one day in the crypto world, one year in the real world, one day on the chain, one year in the crypto world". The changes in this circle are indeed too fast. Some people also say, "No big deal, wait until after the New Year to deal with it."
Different choices will lead to different results. In fact, whether it's life or investment, it may not always be as expected, but the dissatisfaction is also a choice of your own. As long as you are sure of the right direction, just do it, because only your own experience will make you grow and become stronger, and only your own achievements can accompany you for life. Any other people's views or evaluations are temporary.
Whether it's losing money or making money, it's just a comparison of two different situations in your life. In fact, there is no such thing as luck or misfortune in life. Instead of envying or jealous of others, it's better to live in the present, do your best, and stick to 1-2 things you like. As long as you make progress today compared to yesterday, that's enough.
In the brilliant river of time
We have entered the crypto world
Winter goes and spring comes, another year ends
In the wind, flowers and snow, we chat and laugh
In 2025, we
Do not forget the original intention
Forge wisdom in challenges
Grasp value in opportunities
Empower life in trading
Feel happiness in life
In the new year
May you sail against the wind and waves
Reap prosperity and freedom
