Source: Talk Li Talk Outside
Remember in the article on New Year's Eve, we were optimistic that the overall performance of the Altcoin market in the first quarter of this year would be good, and if there were no black swan events, we might see a good market in February this year, and there was a possibility of seeing BTC at 110,000.
But the reality is that we are facing Trump's tariff policy, a $150 million hacking incident, the Argentine president's LIBRA token incident, and so on, which have triggered a large-scale liquidation in the market. This further confirms the saying we often say: the market is unpredictable, we cannot control the market, the only thing we can control is our own position.
Reviewing the FTX collapse in November 2022, the Fear and Greed Index was only around 20 at the time, but the liquidation in the past few days has directly led the Fear and Greed Index to 10, which is equivalent to the lowest level since the 2022 bear market, and people's emotions have turned to extreme panic at an amazing speed, as shown in the figure below.
However, for some people who have done a better job of position management, this kind of extreme market is also a good opportunity, because in a sense, the occurrence of such an extreme market may also mean that we may have approached the local bottom of the phased market.
1. What should be done when the market is highly volatile?
At the current stage, the factors we may need to pay a little more attention to are still policy and capital flows. For example:
- Trump's tariff policy
If the Trump administration continues to announce new tariff policies in the next few weeks, it may continue to put short-term pressure on the market.
- ETF inflow/outflow data
If the situation is unclear, there may be continued outflows, which will further negatively impact market sentiment. If inflows resume, it may be a relatively good short-term signal.
In terms of specific position management, we can also take this opportunity to make some new optimizations, such as:
1) Continue to optimize the portfolio
If you are not a technical expert in short-term trading, then continue to hold your BTC, don't easily give up your chips. At the same time, you can make necessary profit-taking based on your holding cost and target (still the old saying: buy in batches, sell in batches).
If your risk preference is relatively low, you can continue to reduce the proportion of your Altcoin holdings, especially those coins that you don't see any bullish catalysts and have weak rebounds. You should strictly follow your risk preference to take stop-loss or take-profit actions, don't hold on to them stubbornly. Of course, if you have already strictly taken profit-taking actions before, and you are also quite optimistic about the Altcoin you bought, then you can continue to hold these Altcoins.
If your risk preference is relatively high and you still like to research and buy Altcoins, then try to focus on the relatively stronger Altcoins, such as those that don't fall or fall very little when BTC falls, and are the first to rebound when BTC stops falling. Avoid buying those Altcoins that have fallen a lot and you feel have already fallen to a position or you think are already very cheap. Even if you are gambling, don't gamble on those weak projects, and think about your reasons for buying. The simplest idea is that if you can't quickly list 3 reasons why you bought it within 10 minutes, then don't buy it.
Also, continue to maintain a certain position of liquid funds (USDT/USDC) to deal with the possible new black swan events.
2) Continue to learn
Reduce the time spent watching the market, and consider doing some things you wanted to do before but didn't have the time, or things you are interested in. Staring at the K-line won't bring you direct results, just set up the necessary monitoring and alerts. If staring at the K-line with your own will can pull the market, I would definitely watch it 24 hours a day without sleeping.
Or you can also consider using some ways to continue to maximize the utility of your existing funds. For example, you can seek better financial returns for your idle funds (pay attention to project risks when participating in on-chain stablecoin finance, and pay attention to lock-up periods when participating in exchange stablecoin finance, and don't recommend locking up your assets), as shown in the figure below.
Or you can also use tools like Rootdata to find and research potential airdrop projects, use funding rates to do some arbitrage operations, and so on... In short, use the methods you like or understand to keep your investment portfolio growing continuously. Sometimes, small money is also money, don't always fantasize about making $1 million overnight and look down on various $1,000 small opportunities.
Also, it's not that you can only make money in a bull market. In fact, if you ignore the concepts of bull and bear markets, there are always various opportunities to make money in the market, it's just a matter of whether you can discover them, understand them, do them well, and generate better returns.
2. Is there still hope for the market?
In the previous article, we also mentioned that I will continue to remain optimistic about the overall market trend in the future. If there are no further major black swan events, I think the market may have some new opportunities after some consolidation and correction, if we can see some new driving forces for recovery in the narrative, economy or policy.
Of course, the opportunities I'm talking about don't mean you can see a big green candle and achieve financial freedom tomorrow or the day after. In an unpredictable economic market, we just need to think about some forward-looking things, and it's best to abandon the fantasy of getting rich overnight and take a longer-term view of our investments.
At the current stage, if the so-called bull market wants to continue, it needs to create new catalytic events to attract more new buyers to participate. The potential events (relatively important) that can be seen now include:
- US Bitcoin National Strategic Reserve
But this thing has actually been hyped for a long time, and some of the expectations may have been reflected in the past prices.
For now, we just need to keep an eye on the progress of this event. Although this is still a very big and important catalyst for the market, its impact is mainly long-term, and before this thing is finally implemented, BTC's price will definitely continue to grind for a long time, until the US has enough chips, it may really be implemented.
The White House will hold its first Crypto Summit on March 7, so we can also pay attention to see if the strategic reserve issue will be mentioned.
- Fed rate cuts, crypto regulatory policies
If you follow the market dynamics closely, you will see the FED (Federal Reserve) and SEC (US Securities and Exchange Commission) very frequently, because their every move will have a huge impact on the market.
In fact, the market has been focusing on interest rate cut expectations since last year, but to be honest, in the current stage of the cryptocurrency market itself, it is at most a small market. We will take in the liquidity spillover from the stock and other financial markets due to interest rate cuts and easing, but we should not expect too much liquidity to flow into the cryptocurrency market first.
I see that some KOLs on the internet now believe that the cryptocurrency market will become the largest reservoir for the US dollar, but I personally think this claim, at least at the current stage, may be a bit of a fantasy. It would be better to say that the cryptocurrency market will undertake a portion of the liquidity spillover of the US dollar, and in the future, US bonds, US stocks, and cryptocurrencies will jointly undertake the role of the reservoir. The current total market value of US bonds is about $32 trillion, the total market value of US stocks is about $60 trillion, and the total market value of cryptocurrencies is about $2.8 trillion.
Moreover, the so-called market value of the cryptocurrency market at the moment is actually only a kind of unrestrained performance under the "policy uncertainty". Once the United States and other countries further clarify the regulations and laws of the cryptocurrency market through various policies in the future, and there may be at least 90% or more of the garbage projects zeroed out or closed, the market value of the cryptocurrency market at that time may become a true reflection of its market value.
But "policy uncertainty" is precisely the opportunity for the cryptocurrency market in the past more than 10 years. The cryptocurrency market has grown from a market value of $30 billion in March 2015 to $2.8 trillion in March 2025, and Bitcoin has risen from less than $500 in 2015 to nearly $110,000 at its highest, during which countless wealth creation opportunities have emerged (of course, in the dark forest, there have also been countless people who have suffered heavy losses).
With the continuous development of the cryptocurrency market, the continuous in-depth participation of institutions, and the follow-up of various relevant regulations or policies, the opportunities and imagination space left for ordinary people in the future cryptocurrency market will only become smaller and smaller. However, if we continue to ignore the short-term and medium-term fluctuations and look at it from a longer-term perspective, the cryptocurrency industry is still in a stage of rapid upward development.
Until now, I can still see many people saying that the cryptocurrency industry is a scam, Bitcoin is a tulip... Anyway, whatever they say is their own freedom, and I won't bother to respond to such remarks. As long as we believe that the future prospects of this industry are still bright, that's enough.
3. Finally, let's take a look at what else has been worth paying attention to or interesting in the past few days:
- The Bybit hacker money laundering saga
It is reported that the Bybit hacker (a North Korean hacker group) has now used THORChain to successfully convert more than half of the stolen ETH into BTC, with the hacker transferring at least 161,490 ETH to THORChain through 3,934 different bridge transactions, and the hacker also used a large number of blockchain tools for jumping, including Asgardex, DeFiSwap, FortunaSwap, GemWallet, LiFi, ShapeShift, TrustWallet and others.
Due to the hacker's money laundering, it also caused THORChain's trading volume to hit a historical single-day high last week. Perhaps the matter seems a bit serious or it is because of THORChain's inaction in this matter (the current community views are actually mixed, with some criticizing THORChain for its inaction, while others support THORChain's approach of complete decentralization), on February 28, the anonymous core developer of THORChain, Pluto, announced his withdrawal from the project, as shown in the image below.
- Will the SOL ETF be approved?
On February 28, CME (Chicago Mercantile Exchange) announced that it will launch SOL futures on March 17, offering micro contracts (25 SOL) and large contracts (500 SOL). As shown in the image below.
Based on the previous experience of BTC ETF and ETH ETF, the SOL futures may be paving the way for the approval of the SOL ETF.
- Will Base chain become the fastest EVM chain?
On February 28, Base announced that it will launch Flashblocks (a technology developed by Flashbots, which achieves through the partial blocks published by the block builders) on the mainnet in the second quarter, and this upgrade will shorten the effective block time from 2 seconds to 200 milliseconds, making Base the fastest EVM chain to date. As shown in the image below.
- SEC says MemeCoin is not a security!
On February 27, the SEC issued a new statement saying that the issuance and sale of MemeCoin may not be subject to federal securities laws, and MemeCoin is usually not a security, but more like a collectible. However, they also warned that not all MemeCoin are exempt from securities laws, and the risk of MemeCoin fraud still exists. As shown in the image below.
The SEC's plain language is basically saying: the president's coin scamming the little guys is legal, as if the little guys voluntarily bought a kind of collectible, but those MemeCoin competing with the president's coin may be illegal and fraudulent haha.
- SEC withdraws lawsuit against ConsenSys
On February 27, the SEC withdrew its lawsuit against ConsenSys (the parent company of MetaMask), meaning that the battle that began in 2023 against ConsenSys for providing staking and swap services in violation of securities rules has temporarily ended. As shown in the image below.
ConsenSys can now go all out again. On February 28, MetaMask announced that it will add support for Solana in the second quarter and Bitcoin in the third quarter, and will also undergo a complete UI/UX overhaul and eliminate gas fees through account abstraction.
With the resolution of this lawsuit, analysts believe that the previously uncertain MetaMask token MASK may be back on the agenda, and the LINEA token of Linea may also be launched earlier this year (2025).
