Author: 0xTodd, Source: Twitter @0x_Todd
In the past week, many friends have called me to inquire about the market situation, and I feel it is necessary to publicly share my thoughts and disclose my views on the current market situation -
【What has changed】
【The future process】
Those who have been following me for a long time know that I am a long-term investor. So since 2019, I have had an annual strategy that is updated every year, and 2024-2025 is roughly this one, for discussion with my family.
I. DeepSeek has burst the bubble
Whether or not DeepSeek really used $5 million to train this AI, the narrative is like this: 【Algorithm Upgrade】 at least in the short term has defeated 【Computing Power Upgrade】.
Don't get caught up in whether this thing is real or not - since the market unanimously recognizes the $5 million, you have to take it as true.
By the end of 2024 in our crypto industry, apart from meme, I'm reluctant to admit but objectively there is only one narrative left: AIAgent, which is the hope of the whole village.
However, no one expected that AIAgent would be ruthlessly crushed by the real AI track neighbor DeepSeek.
The DS team is full of real IQ200, fresh graduates from Tsinghua and Peking University, and medal winners in the International Mathematical Olympiad.
In contrast, the ones we worship in this industry are second-tier programmers who are idle at home, AI engineers who have been fired from big factories or are moonlighting, so sometimes we are forced to have an IQ of 50.
So..
On January 27th, I tearfully took profits on all my AI token positions, not selling at the highs, and had to take a big drawdown, it's not true that I don't feel the pain.
But the colder fact is that this has turned our entire AIAgent track into a joke, and this is likely to be true.
"Narrative" comes before "event" because this "event" has not yet materialized, it can only rely on "narrative". Once the story can no longer be told, the decline of the track is truly irreversible.
II. The Mob of the President and the President
I don't know how everyone felt during the Spring Festival, but my physical experience is that many relatives and friends are asking how to register on BN or OKX, because they want to buy Trump coins.
The last time they were this crazy was during the National Day, when they wanted to open accounts and charge into the A-shares.
Shanghai Composite Index trend Source: Tencent Securities
If I'm not mistaken, those brave warriors who entered the A-shares on October 8th are still hanging on that mountain top.
After taking profits on AI, to be honest, I got more and more scared, and then I saw this post.
Roughly: The president seems to be losing money, but for two possible reasons:
1. He doesn't make money through the channels you can see
2. He's an idiot
Anyway, I know the answer can't possibly be 2.
Yes! Meme is now what the president is playing, and he can even make money through channels unknown to us.
Frankly, can our meme players compete with Trump sitting at the same table?
A Thai hippo, an American squirrel, a longevity drug that extends the life of flies, can they really sit at the same table as the resident of the Oval Office, Trump?
It's New Year's, the adults at one table, the kids at another.
The adults drink fine wine, the kids can only drink Sprite.
So on that day, I basically cashed out all my meme positions. My meme position had once made huge profits, but because I actively lowered my IQ to 50, I didn't complete the great retreat, but kept joining the great revolution.
It feels like a dream.
III. A Top Signal: A High School Boy Makes Millions
I believe that all the families who play meme, and even those who don't play meme, have heard about this legendary story recently.
A high school boy, by joining and sitting still for a month, suddenly hit Jelly, and made millions at a very low cost.
Of course, the story gets more and more outrageous as it spreads, and the rumors get more and more, I'm not 100% sure this is true, but I know the taste is right.
Looking back at the 69K historical top in 2021, 1-3 days before, I was sighing:
Interns, easily outperforming fund managers
ENS grassroots community contributors, airdropped millions
At that time
Just like
Now
I liked this post, where a TIME editor (or possibly a hacker) could immediately harvest countless SOL with a fake tweet.
I ask you, what does this mean?
It's not that making money is wrong - the masters can always make money, even at the bottom of a bear market they can still make money.
But if the subject becomes ordinary people:
Intern boy makes big money, ENS contributor boy makes big money, high school boy makes big money, editor boy makes big money.
It means: 【At this moment, everyone's hands are very loose】
Friends who play cards often know that it's only when the floating profit is extremely high that they become loose-handed.
This represents the greed index reaching a true peak.
This is a super top signal.
So on the 30th, I cleared out almost all my Altcoins, only keeping BTC and a small portion of mainstream coins ETH/SOL/DOGE exchange coins.
Although there are still losses, at least I have left some victory fruits.
I admire the brilliant operation of the high school boy, and I also revere the iron law of this alternative investment market.
IV. Doubts about BN and BN's Response
Ah, to be honest, I don't want to talk about this topic.
As a former CEX practitioner, I've seen this consultant-listing-dumping routine too many times, from the initial anger to the gradual numbness, I'm already used to it.
But in the past, this thing was kept under the table, it belonged to "small greed and small corruption are the lubricants of development";
It belonged to "when the water is clear, there are no fish", the water is slightly turbid under the surface, and it is part of the game rules.
After all, we are not living in a utopia, not living in a vacuum homeland.
But the thing that is most taboo is to take it from under the table and put it on the table.
I have no intention of criticizing BN or the sister, because this exists in almost every CEX.
If this were in the traditional world, to put it exaggeratedly, it would be a huge scandal that could immediately lay off hundreds of people and dozens of people in irons.
Maybe the sister would be better off not responding, learning from the celebrities to do a cold treatment, still giving the retail investors a little hope.
But our industry is already dominated by skeptics, and a huge scandal is a heavy blow, ruthlessly hitting the hearts of every holder.
It has shattered the faith of many people.
Our industry really needs "gods", because it is sustained by consensus.
But when people find out that the public servants under the "gods" also want to make some quick money, the faith suddenly disappears, and it is quickly projected onto the gods-related - All the Altcoins on BN are now facing a huge skepticism and scrutiny from retail investors.If AI and HOOK are like this, will the other coins really be any better?
V. The Future Script
If we follow the "clinging to the sword in the boat" perspective, this drop is very similar to 5.19, and I suggest that everyone review the trend after 5.19 themselves.
The trend after 5.19 in 2021, source: Bitfinex
If following the 5.19 script, the next step would be a repeated and sustained two-month volatility, until even the most loyal people are washed out, then a new $Bitcoin ATH will come.
Of course, some suspect this is the 12.4 script, AKA the beginning of a bear market.
From my personal inclination, I hope this is 5.19.
After all, the matter of Bitcoin being the U.S. national strategic reserve is moving towards clarity, and we should never underestimate the huge impact of this.
Even if BTC reaches 85K-88K, I would still be willing to add some more positions.
VI. My Position Distribution
My current positions:
40% BTC
20% major Altcoins (ETH, SOL, Doge, BNB/MNT)
40% stablecoin financing
BTC is my eternal faith, I think I will never sell BTC again, nor will I do any more swing trading.
Reasons for holding ETH:
To be honest, my faith in ETH is weakening.
However, objectively speaking, the President's DeFi project is buying ETH.
I don't know how many of you family members are trading U.S. stocks, many people regret not following [Nancy Pelosi, the Goddess of the Capitol Hill].
Source: CommonWealth Magazine
Pelosi's heyday was as Speaker of the House, which is only the third-ranking position in American politics.
But now Trump is the real President, this Crypto President is holding ETH in large positions (although he has deposited it into untraceable Coinbase custody), this weight is not to be underestimated.
Secondly, ETH has fallen to its current position, I feel it has reached the extreme of FUD, and there may be a rebound. I can't buy when no one cares, but at least don't sell when no one cares.
Reasons for holding SOL:
There is a small probability of an ETF;
But the cooling of the AI narrative and the short-term decline of MEME are two small clouds.
Reasons for holding Doge:
Grayscale has launched a Dogecoin trust, Doge also has a small probability of an ETF
In addition, Musk is working hard in the D.O.G.E department;
Being on the same car with the world's richest man and the "U.S. NDRC director", I think I can sleep well.
Reasons for holding exchange tokens:
To be blunt, exchanges have no chance of reaching a bigger stage.
Coinbase will not list BNB, and Binance will not list MNT.
But exchanges are the only institutions in our industry that can make money and share profits;
If the bear market really comes, exchange tokens will be relatively more resistant to declines, and the occasional IEO can also recover some losses, relying on this to get through the bear market.
VII. Cruel View: The Good Days of the Old Timers Are Over
Aside from the above, I am most likely not going to hold any Altcoins in large positions in the short term - the reason is also very simple, inflation is too fast.
The speed of new users and new capital entering the market is simply no match for the speed at which these token issuance maniacs are printing.
Source: Decrypt
The other day there was a statistic that the top account on pumpfun had issued 17,000 tokens in 3 months.
Not 170, not 1,700, but 17,000! His contribution alone may exceed the total token issuance of the entire 2017 bull market.
Why has the investment strategy of the old timers become ineffective?
Too many choices
Too many angles!
Even the same angle has N CAs
How can the old timers' Altcoins compete?
The old timers' favorite strategy: buy a mid-cap Altcoin at the $100M, $200M level.
Hold it for 2-3 months, betting it will outperform BTC.
However, now it may not even be able to outperform ETH.
And General P's favorite strategy: buy a $10K valuation project in the domestic market.
Run away 30 minutes later.
Real men never look back at the explosion.
Obviously, in the era of token hyperinflation, General P is far superior to the old timers.
I'm not calling on everyone to become a P-warrior, I just hope that at least everyone won't be an old timer.
VIII. Best Position: 50% BTC + 50% Stablecoin Financing
Also, I sincerely advise everyone to hold a certain amount of stablecoins to get through the coming period.
You have to accept the fact that no one can really sell at the super top.
The mountain top is once every 4 years, and in the 1,000+ days you have to find one day to sell, a 1/1,000 probability, and only a few super lucky ones can do it.
At this stage, a 50/50 position is the best choice.
50% of your principal invested in financing, we don't talk about mining or doing any arbitrage.
We just do the simplest Ethena USDE, now Pendle can still offer an 18% interest rate.
If you're too lazy to mess with Pendle, just throw it into AAVE or mainstream CEX financing, there's still 10%.
The other 50% is mainly in BTC, quietly waiting for the day when the U.S. Bitcoin strategic reserve arrives.
With interest cash flow,
and also dreams and beliefs,
you must be comfortable,
and covered.
Of course, you can also allocate 5% to the Altcoin you truly believe in, whether it's ETH, SOL, Doge or any other faith coin.
Allocate another 5% of your funds to go PVP a couple of times, win big once, lose it as consumption, keep your hand in, isn't that great?
Finally, form this Yin-Yang distribution.
IX. Finally
I'm quite satisfied with my current positions, after all, this is my 8th year in the crypto industry, with some experience accumulated over the years.
The only thing I regret a bit is that I've been playing in Osaka these past few days, being lazy, and didn't put these thoughts together and release them in a timely manner.
The same strategy, if I had said it a few days ago, it might have helped a lot of people, but now it's become an after-the-fact review.
But it's never too late to make up for lost sheep.
I hope that every family member can achieve their own big results in the crypto market.
Of course, if you can't get the big results, then keeping some small results, earning more spiritual wealth and social wealth, is also not in vain.
