Think about it—when was the last time you had a truly good trade?
What was the token? How much in % and USD terms did you make?
This bull run is indeed tough.
I’m down on a few recent trades, but surprisingly, I’m also badly down on some long-term holdings like STX and AR.
I’m still up on my overall portfolio this cycle despite having made 56 bad trades. (These trades involve ETH/BTC/SOL rotations. For example, if I rotate SOL to ETH and ETH underperforms SOL—even if ETH is still up in USD terms—it counts as a bad decision.)
My best decisions were: selling ETH for SOL, holding BTC, and farming airdrops.
Yet the most important decision is yet to come: when to sell it all? For this, we need to know when the cycle tops, and bear trend starts.
So, in this post I want to share my thoughts on “the market top” topic, discuss future for Ethereum, share my thoughts on token printing, and what’s coming next?
My Signal for Market Top
Leverage inevitably seeps into the system. Initially, it lifts all boats, concealing structural issues until a catalyst emerges and falling prices burst the bubble.
The end of bubble last cycle started with worsening macro conditions, leading to derisking in crypto. It popped DeFi/CeFi rates, further putting downward pressure on token prices.
As positions unwound, dead bodies began to appear ashore. We realized that while we were yield farming at 1,000% APY in DeFi, CeFi lenders were gambling with their customers' money.
What degens and institutions lent to Celsius and BlockFi with their realized profits ended up at Three Arrows Capital to once again put it back into the crypto casino buying back the crypto you had sold.
This leverage was hidden from us, and those that managed to identify it before everyone else, made a good buck.
FTX was the largest crypto Ponzi ever, and we all fell for SBF's lies.
Not all leverage was concealed; some spotted flaws in Terra's UST design, but we overlooked Jump Crypto's hidden role in UST.
Identifying where leverage is building takes us a step closer to pinpointing the market top.
In my first "State of the Market" series post a year ago, I shared several potential areas of leverage that have only gained importance since then:
Ethena: Counter to popular belief, the majority (57%) of backing is now BTC, not ETH
Restaking: The narrative is dormant, but LRTs are getting integrated into OG DeFi infra
Looping: Degens chasing higher yields leverage farm by looping positions.
USD0++ depeg is just a trailer demo version of how bad things could end up if Ethena collapses, or if an LRT protocol gets exploited. We’re lucky that THORChain lending got rekt before it reached a level of systemic risk.
Other large leverage build up is Saylor buying BTC thanks to finding a “free money printing strategy.”
No one wants to question his strategy openly while the price is going up.
We still have time, with maturities starting in 2027 and beyond.
We could follow the flows to RWA protocols, but currently, aside from stablecoins, RWAs haven't significantly infiltrated the crypto ecosystem.
Imagine if uncollateralized and tokenized credit suddenly became available as collateral on Aave, enabling billions in borrowing, only for us to realize that defaults are inevitable.
We haven't reached that point yet in this cycle. Maybe the next one?
Then we have wBTC drama: if BTC that’s supposed to be backing wBTC as actually reused for Justin’s needs… No proof of that happening yet.
What else am I missing?
The fact that none of these systemic risks have imploded yet makes me believe that the market top is not yet in.
The market has cooled off slightly with stablecoin borrowing rates down since mid-December, Greed index returning to normal. But the Open Interest is steal near ATH (Ethena accounts for 9.8% of the total OI).
While leverage is under control, there's another cause for concern. It's a concern similar to what ended the 2017-18 bull run.
TOO MANY DAMN TOKENS
This chart made waves on CT last week. And for a good reason. We printed so many tokens that dilute our attention and liquidity.
Rotations occur faster than ever, with CelebCoin launches like TRUMP and MELANIA. Together with platforms that benefit from memecoins, such as Pumpdotfun, siphon money out of the crypto ecosystem.
If you play but don’t earn money you’ll either get tired of losing or run out of money. There’s no wealth effect created.
This token over-printing was a major reason 2017/18 bull cycle ended. Like memecoins, ICOs projects failed to deliver working products.
ICOs is just one of the many ways we print tokens and every cycle it gets easier to issue tokens. We had DeFi, NFTs, Points meta etc. I shared how each affected the market in my previous blog post:
So, what does it mean for the market?
Another reason the 2017/18 bull cycle ended was the regulatory crackdown on ICOs in China, Korea, and by the SEC. With new administration in the US the process is actually reversing, so I remain bullish on quality altcoins
Absolute majority of newly issued tokens gain 0% mindshare and are dead on arrival. Mindshare is a new currency. Use Kaito or Dexu.ai to track tokens that get real human attention.
Printing will not subside: we still have Berachain, Monad, MegaETH, Abstract and more hot tokens to come that will compete for your attention with their ecosystem token launches.
It’s a memecoin season with apathy to fundamentals: If fundamentals start to matter again, very few tokens exist that can attract money & mindshare.
As I said on X, I believe the market might reach a saturation point when degens become too burned out to chase the next big thing. Possible path forward is (MOTGA): Make Old Tokens Great Again.
Mindshare might rotate to the OG, blue-chip NFTs, meme coins, and protocols that survived the bear market. Instead of searching for the next $DOGE, hold onto $DOGE. Instead of seeking new Pudgy Penguins, stay with Pudgies.
Instead of buying the latest hot token, focus on strong teams. Identifying them is a strong competitive advantage.
Sadly, these realizations usually come during the bear markets when we rotate tokens that are down by 95%
I like Fiskantes take here that “Crypto will resemble tech stock market more and more, with few winners capturing majority of upside and mid caps + long tail struggling and underperforming, with few exceptions that will be very hard to stock pick but obvious in hindsight.
If you believe in secular crypto adoption trend continuing, just buy winners and hold long term - time in the market > timing the market
If you don't believe in the secular crypto trend and subscribe to financial nihilism thesis you can try to keep extracting value in short term games, but odds are stacked more and more against you - Fiskantes
A good trade was identifying value accrual assets that benefit from money printing, like DEXes, asset management (Meteora) and Solana itself.
Murad (memecoin cultist) is playing it smart by shilling the same memecoins without distraction. This conviction is needed for community but I’d even suggest cutting the list down to max 10 tokens.
Another interesting development is mimicking Saylor’s strategy within crypto:
E.g., Fartcoin with FartStrategy is copying Saylor's convertible debt paybook by borrowing SOL to buy FARTCOIN.
They’ll also launch free 45 day call options on FARTCOIN, and “repayment priority even if the FSTR price drops.”
Then there’s hope for ETH with ETH Strategy.
If this type of leverage succeeds, other communities might follow suit. Success depends on pumping FART and ETH.
Only the strongest communities could achieve this, potentially concentrating money and attention on fewer assets once again.
Eventually, the bubble will burst.
It would mark the cycle’s top. I'm closely watching to see if a bubble forms in the first place. If it does, I'll double down on it, lol.
WTF is happening to Ethereum?
ETH's underperfomance is pressuring the Ethereum Foundation to step down from its Ivory Tower and tackle obvious issues.
Two recent developments make me bullish on ETH:
Vitalik’s and Aya’s admission that EF is working on large scale changes to the Foundation.
Vitalik’s post on “Scaling Ethereum L1 and L2s in 2025 and beyond”.
ETH Layer 1 will never scale like Solana, and even Vitalik acknowledges that Layer 1 scaling will only needed for critical operations like DeFi, proofs, mass exits, tokenization, even in a Layer 2-dominated ecosystem.
On a positive note, he recognizes the need to strengthen Ethereum's economic model and standardize interoperability across L2s.
The big issue is timing: these changes might not happen quickly enough for Ethereum to regain momentum in the market. EF is starting to hire more people to accelerate ETH… It’s a slow process but perhaps Consensys coming back to build ETH will accelerate it.
If this cycle peaks this year, only strong bullish signals from the newly restructured Ethereum Foundation can boost ETH.
Significant technical changes could occur in the next bear market. When people lose faith in ETH, the market might present buying opportunities.
Until then, Solana's dominance in trading volume, user growth, UX/UI, and increasing TVL is strong. This cycle belongs to SOL and BTC. And SOL still has a spot ETF catalyst ahead.
Seeing these strong fundamentals overtaking Ethereum makes me believe SOL/ETH flippening is possible this cycle (flippening usually triggers market bottom so I hope I’m wrong on this).
However, strong support from BlackRock and other TradFi institutions to tokenize assets exclusively on Ethereum could shift the momentum back to ETH.
Establishment of Etherealize to do BD, and marketing to bring institutions on Ethereum is a bullish.
If BlackRock chooses both Solana and Ethereum, I don't see a major sentiment change.
But if institutions choose only Solana, it’s game over for Ethereum.
What’s next for crypto?
There’s yet another big capital rotation coming for crypto natives: launches of the highly anticipated L1s & L2s.
Monad
Bera
Story
Eclipse
MegaETH
Abstract (already live)
Initia
Movement
Then we have 0G Labs (DeAI L1), OpenLedger, Quai Network, Fuel (already live), Nillion….
The list goes on.
What’s your strategy to bet on each of them?
Are you willing to rotate your core holdings to the new hot TGEs?
Maybe you’ll just bridge your ETH to farm points, high APYs while hoping not to get exploited?
I believe an optimal strategy is to identify 2-3 ecosystems you are truly bullish about and then deep dive into mechanism and game theory. You don’t want to be exit liquidity. But without due diligence you’ll become one.
Let’s say you are bullish on Bera. You need to identify how liquidity games work while lurking in Discord, reading docs, and partnering with your fellow degens in Telegram groups.
Are you willing to play this game?
Don’t just spray and pray. It worked well in the past, but this cycle is harder and requires more effort to make it.
These launches pose high competition for user attention, and capital.
That’s why products like Kaito AI with their mindshare tools make them valuable to identify Schelling points. Protocols are scrambling to pay bribes to get listed on Kaito system which puts them on the display for KOLs to see.
Many probably don’t think Kaito is that important. At the end of the day it just visualizes what people are yapping about. But, trust me, all KOLs check Kaito often to see their own relative performance and what other KOLs are talking about.
If SocialFi is trending, algorithm (and Kaito yap points) rewards participation on the topic, which ends up creating a social bubble.
On top, several protocols incentivize yapping with airdrop rewards.
In any case, competition for mindshare is insane.
I also believe that these new hot launches will put pressure on memecoin rally as mindshare will rotate from memes, to new, hot L1s/L2s mentioned above.
Bull market PTSD
I’ll finish with the same questions as I started this blog post: when was the last time you had a truly good trade?
What was the token? How much in % and USD terms did you make?
Despite BTC hitting ATH, many are underperforming it or are even losing money.
Quick rotation, exploitative memecoin launches, low-float, high FDV tokens, even seemingly free airdrop ended up in losses (airdrop farming on leverage ended up in minus for many).
This created a sort of realization, PTSD, that tokens are not worth holding for long. If you’re in profit - sell.
There’s no conviction in the market for altcoins. Our bull market targets for ETH are laughably low ($10K stands from the last bull cycle), tokens with strong products and team backing fail to rally, and major upgrades lead to sell-the-news events (e.g., Stacks Nakamoto upgrade and Arweave AO launch).
There’s no euphoria in the market. Weirdly enough, vibes are off on Twitter and feel more like a bear run than the bull.
Weirdly, it makes me optimistic that the top is not yet in and good things are coming. I just hope macro doesn’t spoil our party before we hit the moon.
class as always Ignas. thank you