Author: Ignas | DeFi Research
Title: Certainly Bullish State of the Market & What's Next
Compiled by: BitpushNews Yanan
The market always likes to say “this time is different,” but to be honest, I’m kind of hoping the same old thing will happen again: If Bitcoin’s four-year cycle continues, the price of the currency may hit a new high in the fourth quarter of 2025.
Then, it’s the familiar process: once BTC rises, mainstream currencies such as ETH and SOL also surge upwards, followed by another large wave of tokens (maybe meme coins are the most popular) that follow suit and rush upwards one after another.
However, the market has its own temper. When it rises to a certain level, it will turn around and then we will have to enter a two-year "cooling-off period". Think about it, who wouldn't be exhausted after such a crazy rise all year round? So, the two-year rest is like a small vacation for the market.
Crypto research team Delphi Research predicted a peak in the fourth quarter of 2025 as early as mid-2023.
I have mentioned their predictions before, and they are now gradually becoming a reality. However, there are a few things that the team did not expect: the approval of the Ethereum ETF and the approval of the Bitcoin ETF triggered a strong round of FOMO in the market, which directly pushed the price of Bitcoin to its previous historical high in early March.
Many thanks for the insight Delphi!
With Trump’s victory, the government is likely to introduce more favorable cryptocurrency regulations and we may see the final catalyst of the super crazy bull run.
This current optimism is in stark contrast to the cautiously optimistic market view I shared in July. Now, the market is no longer affected by negative factors such as Grayscale ETF outflows and the Mt. Gox incident.
Delphi also mentioned that China is considering increasing money supply due to deflation risks.
In fact, China has introduced the most aggressive stimulus policy since the outbreak of the epidemic, but many people still feel that it is not strong enough and call for further "starting the printing press."
From a historical perspective, whenever China takes measures to inject liquidity, it often has a positive impact on the global economy and the cryptocurrency market.
However, few people on social media X seem to be paying attention to the possible positive shift in China's attitude towards cryptocurrencies: not only may it stimulate the economy by increasing the money supply, but it is also expected to adjust the restrictive regulatory policies on cryptocurrencies.
The most important thing is that previous Bitcoin halving events have ended with a sharp rise in Bitcoin prices, but this rise usually begins to appear about half a year after the halving: this time seems to be no exception.
If all goes according to plan, this will be the most predictable and easy-to-control bull market in history.
How bullish is the market?
The charts in the research report provided by Capriole Investments are quite insightful and worth a closer look.
Their flagship product, the Capriole Bitcoin Macro Index, takes into account more than 60 key indicators closely related to Bitcoin, covering multiple dimensions such as on-chain data (such as dormant flows, supply, hash rate distribution, number of active addresses, etc.), macroeconomic indicators, and stock market indicators.
The index is divided into several stages, and we are currently in the second expansion period, however, its level has neither reached the high point of March 2024 nor is it far below the market peaks of 2017 and 2021.
In short, the outlook is bullish.
The founder of Capriole predicts that the price of Bitcoin will climb to at least $140,000 by the fourth quarter of 2025. When I asked him directly about his views on Ethereum (ETH), he confidently said: "At least $5,000, and it will probably be higher."
If you think the above forecast is too conservative and you believe in technical analysis, you might raise your estimate of Bitcoin's peak price to $210,000.
I plan to stick with the strategy from the previous cycle because I am deeply involved in SOL, ETH, and am gradually exploring the DeFi space and meme coins.
As the price of Bitcoin climbs, many people are frustrated that their altcoins have not risen in tandem. Don’t worry, my dear investors, altcoins tend to catch up after the Bitcoin price surges.
Moreover, the market still has ample room for growth.
According to Capriole Investments’ Altcoin Speculation Index, the altcoin rally has not even really started yet. The index shows that a high percentage means that the market is speculative, while a low percentage may indicate less speculation and suggest that there are better altcoin investment opportunities.
Everything seems too good to be true, which makes people feel a little worried.
We have entered a state of extreme greed.
However, this greedy sentiment is likely to last for quite some time. From November 2020 to March 2021, the index remained above 80, with very small corrections during the period. (Data source: CryptoKoryo)
In short, even if the current situation seems very good, we should remain calm and not blindly rely on leverage operations.
Memecoins
I read an article in the Financial Times the other day titled “Bitcoin’s stunning rise can’t be ignored.”
The comments from ordinary readers are quite interesting, with comments such as: Ponzi scheme, fraud, and "it's useless" appearing one after another.
These self-proclaimed smart people obviously didn't understand the true meaning of it. But I suddenly understood it.
Early adopters of cryptocurrency held similar biases against memecoins: they were scams, worthless, meaningless, etc.
Yet, Bitcoin has held up despite the skepticism, and memecoins have surprised crypto veterans who were skeptical of memes. Both are climbing in price, and their momentum is truly remarkable. Just look at the amazing performance of memecoins after the election, where the price of the major memecoins doubled in just ten days.
Memecoin has crossed a key milestone: Binance and Coinbase have successively listed Memecoin, which is undoubtedly an important step towards standardization.
Prior to the massive introduction of memecoins, Binance released an in-depth research report stating that retail investors are actively exploring new ways to grow their wealth, and memecoins embody the core concept of improving transparency and accessibility, that is, "striving to narrow internal advantages and create a more fair participation environment for global investors."
Memecoin is not only an investment tool, but also a microcosm of "the mutual integration and profound changes of value and cultural significance in the modern financial system."
Considering that Binance naturally tends to list assets with upside potential, I have reason to believe that Binance will list more meme coins in the future.
SOL vs Ethereum
Oh, my dear Ethereum, when will you see the dawn of a price increase?
As the price of memecoin soared, my holdings became heavier and heavier.
FOMO keeps tempting me to turn to those currencies with stronger growth.
But I kept hanging on - hoping that the choice I made was not wrong.
In this round of cryptocurrency cycle, Ethereum and its entire ecosystem seem to find it difficult to reproduce the bull market of the past.
The amount of money needed to leverage the $382 billion Ethereum giant, as well as those old decentralized finance (DeFi) projects and the newly emerging low-circulation, high-FDV tokens, is actually enough to make waves in many other emerging fields. These fields include decentralized science (DeSci), Runes, DeFi projects in the Solana ecosystem, other L1 projects, and even the meme coins mentioned above.
Ethereum and DeFi token investors have made a lot of money in the last cycle, and now they are eager to triple or quintuple their money to achieve financial freedom. But maybe the market won't give them the chance so easily? Let these currencies grind for a while longer.
The money needed to drive Ethereum’s 3x growth could potentially grow the ecosystem that’s injecting new ideas into the crypto space 10x.
This possibility is entirely possible.
Recently, the ETH 3.0 (Beam Chain) roadmap proposed by Justin Drake has not aroused much interest in the community. What’s more, the plan is not expected to be implemented until the end of the 2020s, which obviously has missed the current market cycle.
On the other hand, Solana is in its heyday.
A recent research report released by Syncracy provides a clear comparison of the competitive situation between Ethereum and Solana.
The last round of Solana’s rise was driven by future potential, while this time it is driven by solid fundamentals.
From the comparison of network activities, it can be seen that Solana performs well in terms of total locked value (TVL), decentralized exchange (DEX) trading volume, stablecoin trading volume, and the number of active addresses.
Objectively speaking, it may be a bit biased to compare Solana directly with Ethereum's L1 layer, because in theory, Ethereum's L2 layer should also be taken into consideration. However, since the L2 layer is still largely regarded as a "parasite" attached to the Ethereum main chain, ordinary investors still have doubts about the true value of the L2 layer and it is difficult to accurately evaluate it.
Even if we turn our attention to the revenue of dApps, we will find that dApps on Solana are now able to compete with dApps on Ethereum, showing comparable strength.
Despite this, Solana’s market capitalization is still only about one-third of Ethereum’s. Considering the strong momentum shown by its economic indicators, this undoubtedly indicates that it still has huge room for growth and may even be on par with Ethereum in valuation in the future.
So, will SOL really surpass ETH? In my opinion, when the saying that "SOL will surpass ETH" becomes more and more popular, it may be time to consider re-positioning and return to ETH.
Historically, the moment when Ethereum's market value surpasses Bitcoin is often a clear signal that the ETH/BTC ratio has reached a high point.
