Editor's Note: This article comes fromView on the chain (ID: liansg01)View on the chain (ID: liansg01)

, Author: Hao Tian, ​​reproduced by Odaily with authorization.

The opening statement states that the ordinary people mentioned here refer to every novice user who lacks basic knowledge of the blockchain industry but intends to enter the market. As for the way ordinary people participate, they can invest in a certain cryptocurrency, or join the blockchain industry, start a business, etc., or just show a little interest in it.

Anyway, no matter how ordinary people enter the blockchain industry, they must have a clear understanding of the current bull market. For example: What drives this round of bull market? What are the market fundamentals that support the existence of a bull market? How long can this bull market last? How should ordinary people participate in this round of bull market and so on.

To clarify these issues, we must first understand what is the difference between this round of bull market and previous rounds of bull market?

In a nutshell, there are three major differences between this round of bull market and previous ones:

1) The core driving engine driving the growth of the bull market has changed. In the past, the main driving logic of the bull market was the shortage of supply in the market caused by the halving of mining capacity. The bull market generally occurred before and after the halving cycle of mining. The big bull market in 2017 is a typical example. Although its madness relies on ICO, it is essentially affected by the supply and demand of mining.

But the current bull market is quite different. On the one hand, more than 18 million bitcoins have been dug up and circulated, and the market has transitioned into a stock market. Supply and demand will have some impact on the price of Bitcoin, but it is no longer the main factor. The key to really driving this round of bull market growth is that Bitcoin has successfully broken the circle. Bitcoin has become a strategic anti-inflation asset that Wall Street institutions and technology giants such as Grayscale Fund, MicroStrategy, and Tesla are vying to deploy. Obviously, the investment logic and purchasing power of institutional funds are not comparable to retail investors, which provides strong support for the growth of the bull market.

2) The market fundamentals that catalyzed the bull market to go crazy have changed. The peak period of the bull market in 2017 was brought about by the ICO model. At that time, it followed the slogan of mass entrepreneurship and innovation. Anyone can obtain financing from the open market by writing a white paper and issuing coins. This simple and crude investment and financing The model has attracted a large amount of talent and hot money, and its extremely low participation threshold has driven the market into a frenzy.

In the current bull market, whether it is IEO, IDO or even ITO, or it is launched on Binance Smart Chain (BSC) and Huobi Ecological Chain (HECO), on the whole, the development technology threshold of the project and the user participation threshold are relatively high. higher. This not only requires the project party to have a certain technical foundation, but also has certain requirements for its business, operation, marketing, community and other aspects. Although there are still some local dogs, they are not a little bit stronger than the wave of ICOs in 2017. Therefore, the catalyst for this round of bull market is relatively stable and reliable.

3) The main theme of the story supporting the existence of the bull market has changed. In the past bull markets, everyone talked about the subversive value of blockchain technology, whether they wanted to replace gold with cryptocurrency as a new universal currency for global circulation, or tried to rebuild a new world similar to the Internet based on the underlying blockchain , trying to move everything that can be moved online to the chain. Without exception, this overestimates the actual application value of the blockchain.

In the current bull market, whether it is speculation on the concept of DeFi or the popular NFT, we have found that its focus and practical value are much stronger. Taking DeFi as an example, lending, derivatives, stablecoins, aggregators, etc. are all applications of the traditional financial system in the blockchain industry. Although the number of users is not at the same level, it has accumulated more than 300 in three years The asset lock-up of 100 million US dollars, dozens of ecological projects and the nestable ecology of layer-by-layer combination have built a complete set of infrastructure for the blockchain financial building. Compared with the blockchain value story told in 2017, this seems to be much more reliable. Overall, the current blockchain entrepreneurial environment is relatively more pragmatic. After all, most people are not afraid of being cheated, what they are afraid of is being cheated by someone who knows they are liars.

Clearing up these problems may not allow you to grasp the wealth code of this round of bull market, but at least it will allow you to establish correct industry awareness and avoid unnecessary pitfalls. Of course, you can also follow the general trend of the industry in the bull market How much a piece of the pie. Friends who have followed my community dynamics for a long time know that I have recently started a business in the sea and established a new knowledge service community called "Qingge". Friends Bai, let ordinary people enter the circle to get some basic cognition and skills, avoid some pitfalls, and enjoy the development dividend of the digital age.

So, for ordinary users, how to recognize the current bull market and how to deal with it?

In this round of bull market, mainstream currencies such as Bitcoin and Ethereum must play the leading role, and other DeFi coins will play supporting roles in enjoying the opportunity of hot rotation. The reason is simple. Mainstream institutions on Wall Street have stable asset allocation, and they pay more attention to the market stability of the currencies they invest in. Therefore, Bitcoin, Ethereum and other mainstream currencies with a long period of verification and a large group consensus will be prepared. Favored by the institution. Some subsequent investment institutions will also use this as a key investment target layout. This means that retail investors should also regard mainstream currencies as key holdings in the initial stage of participation.

Of course, many users think that Bitcoin and Ethereum have risen a lot, and now there is not much room for growth in the market, and they are unwilling to put limited funds on mainstream currencies, but instead try to gamble on altcoins. In fact, this kind of thinking is very wrong, because after Wall Street and other institutions become fomo, what they care about is not the unit price of mainstream currencies. It's a pity that many retail investors still don't understand the truth that the strong are always strong. Risking investment in altcoins seems to be able to obtain higher returns in the short term, but that is only a unilateral rise in the market. If there is a unilateral decline in the market, the profit-taking speed of altcoins is also unprepared. Ordinary users should abandon the aggressive mentality at the initial stage of entering the market, and invest in some mainstream currencies with higher stability and security. Even if they fall, it is only a matter of time for mainstream currencies.

In this round of bull market, it is difficult to repeat the situation of skyrocketing thousands of coins. Compared with 2017, the whole market will be more mature and rational. Perhaps driven by mainstream currencies such as Bitcoin and Ethereum, new tracks such as DeFi, NFT, and BSC and HECO will generate some hundred-fold coins due to hot spots, but most of the funds supporting such projects are hot money. To be honest, relying on some early giant whales to form a group, find a project that is not too bad, and hype it in turn, you can also concoct a lot of 100 times currency projects. Therefore, this kind of 100-fold currency, which is based on speculation and hot spots, has a rapid rise and a sharp decline. For example, HBO in the HECO ecosystem recently, and XVS on BSC and other currencies. When retail investors are bitten by the increase, the building is actually about to collapse. There is basically only one end for this kind of currency that is jealous, and there is no day to turn around after entering the market.

Of course, when the main market rises, there are also many altcoins that will follow up and make up for the increase, but in fact, it is only the spillover effect of some hot money and retail funds. For most people, what investment actually wants is not a short-term increase, but a long-term steady rise. It is only a short-term rising currency. Only a few people can restrain their inner greed and flee from a high position. Most people will bear the burden in the end. No small loss. There is a saying that when you participate in a project and wonder who is giving money, the person who gave the money must be you.

The advent of this round of bull market will be relatively long, and there may be multiple sharp corrections throughout the process, which may be similar to the 312 sudden black swan level, or it may be a monthly level of shocks and negative declines. There is a picture on the Internet that is very vivid. You think that value investment is always rising, but in fact value investment may experience various twists and turns along the way. The fundamental reason for this situation is that during the rising process, the entry of main funds, especially institutional funds, cannot hedge against the escape pressure of short-term profit taking. In addition, market contracts and market speculative sentiment are particularly serious. Tens of times and hundreds of times of leverage often create great pressure on the market on one side. Therefore, multiple, irregular, and non-periodical large-scale double explosions will be the market. A true portrayal of bloody and helpless.

In response to the sharp rise and fall of the market, on the surface, retail investors can ignore everything as long as they hoard coins brainlessly. In fact, if there is no firm grasp and belief in the trend, most people will not be able to keep it at all when most of the profits retrace or even lose money. Hoarding coins requires users to have the idea of ​​investing with absolute spare money, to have an optimistic judgment on the future market, to have restraint and self-discipline for the floating profit of the asset book, and to have extreme patience for frequent position changes, etc. On the surface, value investing looks at vision, but in the deepest part, it is about human gain and loss and wisdom.

In this round of bull market, 100-fold, 1000-fold or even 10,000-fold coins will be born in DeFi, NFT and other fields, and will be born in ways that ordinary users such as IDO, ITO, and IUO cannot understand at all. It's not so much that I don't understand it, it's better to say that the threshold of participation has been raised by cognition. This is similar to a step-by-step private placement that is public and has thresholds. It looks like a bright card, but in fact only a few people can really seize the opportunity, just like a company holding a koi lottery on Weibo. It seems that the bonus is very tempting, but it was born based on this premise. The 100 times currency has nothing to do with most people. On the contrary, when the mainstream crowd sees a currency through a large centralized exchange, those who re-enter the market may have already become high-level takers.

The 100-fold coin that appears in the current bull market is essentially a wealth opportunity created by using information asymmetry. Compared with the crazy bull that retail investors buy, everything goes up, such a bull market is obviously not enough to shake people's hearts. After all, most novices are trying to win without thinking, but to really grab these hundred times coins, you need to learn, resources, circle, and take risks. How to do it? Simply put, it is necessary to look for high-quality projects in the circle with the thinking and perspective of an angel investor, and invest as early as possible before a project goes online. The evaluation of such projects depends on the team, technical strength, track, and growth potential. It is the right way to replace short-term speculative profit thinking with longer-term value investment thinking. Of course, there are also top projects with solid fundamentals suitable for value investment, such as AAVE, UNI, SUSHI, etc. Whether you can discover the value of such currencies and how long you can hold them depends entirely on your personal cultivation.

This round of bull market will be a prosperous scene and a nightmare for many users in the sinking market. Because in the bull market sentiment, there will be many high-quality projects that seem to be good but actually hide the sickle among the high-quality projects, and even some funds and pyramid schemes that blatantly use the banner of high returns and do not cover up will also confuse them. These local dog projects do not have reliable technology, nor do they do things in a down-to-earth way. They just rely on stories that they don’t even believe in, and with a few exquisite market-making, they will lock many novice users on the top of the mountain. There will never even be a day of unraveling. The truth that most people lose money in the bull market is not false at all.

There are several reasons why novice users are attracted by some local dog projects that lack basic value: 1. Many novice users lack the most basic industry knowledge and are easily bewitched by stories of people with ulterior motives; 2. Blockchain Project investment is like the seed round stage of a project. It is difficult to directly distinguish a good project from a bad project; 3. The Tugou project will spend a lot of initial investment in the publicity and operation stages, and the technical aspect that should really spend money On the contrary, they will not invest in it, so it is easier to create the illusion of a "good" project; 4. The Tugou project will work harder in trading and market making, so it can use human greed to attract many users in the short term; 5. Many participating Tugou projects Most of the people in the project are gamblers, always trying to make a big fortune with a small amount, and often they will be tortured more ruthlessly by the market.