From Speculation Frenzy to Value-Driven: The New Golden Age of the Crypto Market

The current crypto market is undoubtedly filled with confusion and torment for investors who experienced the bull market of 2020-2021. That era of revelry ignited by the global central banks' easing policies is long gone, and now the global financial markets are at a delicate balance point. On one hand, there is unexpectedly strong U.S. economic data, and on the other hand, the Federal Reserve's firm hawkish stance, with historically high interest rates suppressing all risk assets.

The paradigm shift dominated by the macro environment has made this round of the crypto cycle the most challenging period for retail investors. The previous speculation model that purely relied on liquidity-driven factors has become ineffective, replaced by a "value bull" market that places greater emphasis on intrinsic value, driven by clear narratives and fundamentals.

However, challenges and opportunities coexist. When the bubble bursts, genuine value investors will usher in their golden era. It is precisely in such an environment that institutional compliance entry, technical deflation, and the real applications integrated with the real economy will highlight their true, cyclical value.

1. Difficult Times: The Test of Macroeconomic Headwinds

The difficulties of this cycle stem from a fundamental reversal in macro monetary policy. Compared to the extremely loose environment of the previous bull market, the current market faces the most severe macro headwinds in decades. The unprecedented tightening cycle initiated by the Federal Reserve to curb severe inflation has brought double pressure to the crypto market, completely ending the old model of easy profits.

1. Macro Data Maze: Interest Rate Cuts Are Far Away

The key to breaking the current market dilemma lies in understanding why the Federal Reserve has been reluctant to back down at the end of interest rate hikes. The answer is hidden in recent macroeconomic data - this seemingly "good" data has become "bad news" for investors hoping for easing.

Despite inflation falling from its peak, its stickiness is far beyond expectations. The latest data shows that while the U.S. CPI year-on-year rate for May was slightly below expectations, the core inflation rate stubbornly remains at a high of 2.8%, still significantly distant from the Federal Reserve's 2% target. This is directly reflected in the Federal Reserve's latest economic forecasts and the closely watched "dot plot". Federal Reserve officials have significantly lowered their rate cut expectations, reducing the median number of rate cuts for the year from three to just one.

Meanwhile, the U.S. labor market continues to show remarkable resilience. The number of new jobs added in May exceeded expectations, and the unemployment rate remains low. A strong job market means that consumer spending is supported, which in turn will put upward pressure on inflation, making the Federal Reserve more cautious about interest rate cuts.

2. The "Gravity" of High Interest Rates: The "Bleeding" Effect of Crypto Assets

This macro background has directly led to the difficult situation in the crypto market:

Liquidity exhaustion: High interest rates mean a reduction of "hot money" in the market. For the crypto market, especially altcoins, which heavily rely on the influx of new funds to drive price increases, the tightening of liquidity is a fatal blow. The once prevalent "everything rises" phenomenon has been replaced in this cycle by a structural market characterized by "sector rotation" and even "only a few hotspots."

Opportunity cost skyrockets: When investors can easily obtain over 5% risk-free returns from U.S. Treasury bonds, the opportunity cost of holding assets like Bitcoin, which do not generate cash flow and have extreme price volatility, sharply increases. This has led to a significant outflow of funds seeking stable returns from the crypto market, further exacerbating the market's "bleeding" effect.

For retail investors who are used to chasing hot trends in a flood of liquidity, this change in environment is brutal. The lack of in-depth research and a strategy that simply follows the hype can easily suffer heavy losses in this cycle, which is exactly the core of the "difficulty" in this cycle.

II. The Golden Age: From Speculation to Value, New Opportunities Emerge

However, the other side of the crisis is opportunity. The macro headwinds act like a stress test, squeezing out the market's bubbles and filtering out the core assets and narratives that truly have long-term value, thus opening an unprecedented golden era for prepared investors. The resilience of this cycle is precisely driven by several strong endogenous forces independent of macro monetary policy.

1. Golden Bridge: Spot ETF Opens the Institutional Era of the Year

In early 2024, the U.S. Securities and Exchange Commission historically approved the listing of a spot Bitcoin ETF. This is not just a product launch, but a revolution in the crypto world. It opens a "golden door" for trillions of dollars in traditional finance to invest in Bitcoin in a compliant and convenient manner.

As of the second quarter of 2025, the total managed assets of only two ETFs have exceeded hundreds of billions of dollars, and the continuous daily net inflow has provided strong purchasing power to the market. This "new lifeblood" from Wall Street has largely hedged against the liquidity tightening caused by high interest rates.

The CEO of a large asset management company described the success of the Bitcoin ETF as "a revolution in the capital markets" and stated that this is just "the first step in asset tokenization." This endorsement from top global institutions has greatly boosted market confidence and provided retail investors with a clear signal to follow the steps of institutions and engage in long-term value investment.

2. The Faith in Code: Hardcore Support Under the Halving Narrative

In April 2024, the fourth "halving" of Bitcoin will reduce its daily new supply from 900 coins to 450 coins. This code-defined, predictable supply deflation is the unique charm that distinguishes Bitcoin from all traditional financial assets. Against the backdrop of stable or even growing demand (, especially from ETFs, the halving of supply provides a solid, mathematically grounded support for Bitcoin's price. Historical data shows that in the 12-18 months following the previous three halvings, Bitcoin prices set new historical highs. For value investors, this is not a short-term speculation gimmick, but rather a reliable, cyclical long-term logic.

) 3. The Narrative Revolution: When Web3 Starts to Solve Real Problems

Macroeconomic headwinds are forcing market participants to shift from pure speculation to exploring the intrinsic value of projects. The core hotspots of this cycle are no longer the baseless "Dogecoins," but rather those innovative narratives that attempt to solve real-world problems:

• Artificial Intelligence ### AI ( + Crypto: Combining the computing power of AI with the incentive mechanism and data ownership of blockchain to create entirely new decentralized intelligent applications.

• Tokenization of real-world assets ) RWA (: Bringing real-world assets such as real estate, bonds, and artworks onto the blockchain to unlock their liquidity and bridge the gap between traditional finance and digital finance.

• Decentralized Physical Infrastructure Network ) DePIN (: Utilizing token incentives to enable global users to collaboratively build and operate the infrastructure network of the physical world, such as 5G base stations, sensor networks, etc.

The rise of these narratives marks a fundamental shift in the crypto industry from "speculating on nothing" to "investing in value." For retail investors, this means that the opportunities to discover value through in-depth research have greatly increased, and knowledge and understanding have become more important than mere courage and luck in this market.

3. Survival Laws in a New Cycle: Patiently Layout Between the Finale and the Prelude

We are at a crossroads of an era. The "hawkish finale" of the Federal Reserve is unfolding, while the prelude to easing has yet to be played. For retail investors, understanding and adapting to the new rules of the game is key to navigating cycles and seizing golden opportunities.

) 1. The fundamental shift in investment paradigm

• From chasing hot trends to value investing: abandon the fantasy of finding the "next hundredfold coin" and shift towards researching the fundamentals of projects, understanding their technology, team, economic model, and the competitive landscape they are in.

• From short-term speculation to long-term holding: In a "value bull" market, the real returns belong to those investors who can identify core assets and hold them for the long term, weathering the fluctuations, rather than to the frequent traders.

• Build a differentiated investment portfolio: In the new cycle, the roles of different assets will become more distinct. Bitcoin, recognized by institutions as "digital gold," is the "ballast" of the portfolio; Ethereum, with its strong ecosystem and ETF expectations, is a core asset that combines the attributes of value storage and production materials; while high-growth altcoins should be the "rocket boosters" based on deep research and small position layouts, focusing on frontier tracks with real potential such as AI and DePIN.

2. Be patient and plan ahead.

Research has revealed that in the last 12 months of the terms of the past three Federal Reserve Chairpersons, even with interest rates remaining high, the S&P 500 index averaged an increase of 16%. This indicates that once the market is convinced that the tightening cycle has ended, risk appetite may begin to recover even before rate cuts occur.

This "running ahead" market situation may also occur in the crypto market. While the market's attention is generally focused on the short-term game of "when to cut interest rates," the true wise ones have already begun to think about which assets and which sectors will occupy the most advantageous positions in this future feast driven by the resonance of macro tailwinds and industrial cycles, when the prelude to easing finally sounds.

Conclusion

This round of crypto cycle is undoubtedly an extreme test of retail investors' cognition and mentality. The era of "easy profits through courage and luck" has come to an end, and a "value bull" era that requires in-depth research, independent thinking, and long-term patience has arrived. This is precisely its "difficulty".

However, it is precisely in this era that institutional funds have poured in at an unprecedented scale, providing a solid bottom for the market; the value logic of core assets has become increasingly clear; applications that can truly create value are beginning to take root. For those retail investors who are willing to learn, embrace change, and view investment as a journey of cognitive realization, this is undoubtedly a "golden age" where they can compete on the same stage with the top minds and share in the long-term growth dividends of the industry. History does not repeat itself simply, but it is always remarkably similar. Between the final chapter and the overture, patience and vision will be the only path to success.

![From "Water Buffalo" to "Value Bull", why are retail investors struggling so much?]###https://img-cdn.gateio.im/webp-social/moments-eeccf85f40513b3b4c1a7d61ca2d54aa.webp(

![From "Water Buffalo" to "Value Bull", why are retail investors having such a hard time?])https://img-cdn.gateio.im/webp-social/moments-11ef90221fb483ec8550a123d17e69db.webp(