Crypto Market Trend Analysis and Investment Strategy

Recently, many people have asked me about my views on the current market situation. As a long-term investor, I would like to share my observations on market changes and my outlook for the future.

1. Major breakthroughs in the AI field

A new product launched by a certain AI company has caused a stir in the market. Although its specific details are yet to be verified, the market generally recognizes the importance of its algorithm breakthroughs. This has had a significant impact on the AI sector of the crypto market.

In the face of this change, I decisively took profits on all AI-related token positions on January 27. Although I couldn't sell at the peak, I still managed to preserve most of the gains overall. This event may mark the end of the narrative for the AI Agent track.

2. Political Figures and Encryption

During the Spring Festival, many people began to pay attention to the encryption currency related to a certain political figure. This reminds me of the madness of the A-shares last October.

According to some messages, the way high-level individuals are involved in cryptocurrencies may exceed the understanding of ordinary people. This also reminds us that in this crypto market, we may just be "playing at the kids' table."

Considering this, I have also recently liquidated most of my meme coin holdings. Although I had previously made a good profit, not being able to exit in time was a lesson.

3. Market Top Signals

Recently, there have been rumors that a high school student made a huge fortune from encryption currency. Although the authenticity is questionable, this phenomenon often indicates an overheated market sentiment.

Looking back at the eve of Bitcoin's peak at $69,000 in 2021, there were also phenomena such as interns earning more than fund managers and ordinary contributors receiving massive airdrops. These are all typical signals of a market top.

Therefore, I liquidated the majority of altcoins on January 30, keeping only Bitcoin and a small amount of mainstream tokens. Although there were losses, I managed to preserve some profits.

4. Disputes in Trading Platforms and Their Impact

A large trading platform has recently fallen into controversy. Although such issues are not uncommon in the industry, their public nature can severely undermine investor confidence. This may affect the performance of all tokens on the platform.

V. Market Outlook

The current trend is similar to the situation after May 19, 2021. If that pattern repeats, there may be a consolidation period of about 2 months, followed by a new high.

However, there are also viewpoints that believe this could be the start of a bear market. From a personal perspective, I tend to be more optimistic. After all, Bitcoin's status in the United States is gradually rising, which will have far-reaching effects. If Bitcoin reaches the range of 85,000-88,000 dollars, I may consider moderately increasing my holdings.

6. Current Position Strategy

My current asset allocation is as follows:

• 40% Bitcoin
• 20% mainstream tokens ( Ethereum, Solana, Dogecoin, etc. )
• 40% stablecoin wealth management

The retention of Ethereum is primarily based on two considerations: first, a certain influential figure is buying in, and second, the current price has fallen to a low point and may rebound.

Holding Solana is because it still has the possibility of an ETF. Dogecoin, on the other hand, is supported by Grayscale Trust and has close ties with a certain well-known entrepreneur.

Although exchange tokens have limited upside potential, they tend to resist declines relatively well during bear markets and can serve as a defensive allocation.

7. Views on Established Projects

I will not hold a large amount of established altcoins in the short term. The main reason is that the speed of new project issuance is too fast, diluting market funds. Established projects find it difficult to stand out among numerous choices. It is recommended to adjust the investment strategy and avoid holding medium market cap projects for the long term.

8. Recommended Configuration

My recommended optimal configuration is: 50% Bitcoin + 50% stablecoin investment.

Stablecoins can provide stable returns, while Bitcoin retains the potential for appreciation. It's worth considering allocating a small portion of funds to projects you are optimistic about or engaging in short-term trading.

9. Conclusion

As a veteran who has been navigating the crypto market for 8 years, I am quite satisfied with my current holdings. The only regret is that I couldn't share these thoughts earlier.

I hope every investor can achieve good returns in this market. Even if it's not possible to make huge profits, accumulating some experience and connections is also valuable.

Wishing everyone successful investments in the new year!