The Current Status and Future Trends of the Crypto Assets Industry

In the past year, the interaction between the Crypto Assets industry and traditional finance, large technology companies, and global political figures has become increasingly frequent. The digital currency introduced by Trump marks the end of encryption liquidity, but this is just the beginning of the industry's integration.

From consultants in Pakistan to cryptocurrency mining farms in Bhutan, and high financing in the Middle East, these events ultimately became the last straw that broke the retail investors.

Crypto Assets industry enters a stagnation period

Humans seem to always be pursuing things that are contrary to the status quo. When the Bitcoin Spot ETF was approved, many believed that Bitcoin would change the world. However, it is now widely regarded that Bitcoin is merely a mapped asset of M2, which neither effectively resists inflation nor is likely to serve as a catalyst to stimulate a bull market.

After a certain politician launched a digital currency, the market experienced a brief surge before falling into silence. Various events, such as a project's self-rescue, the launch of a wallet, and even controversies regarding the identity of a platform's executives, became trivial farces.

Currently, the Crypto Assets market is in a state of stagnation. Ethereum is attempting to return to the L1 battlefield by introducing Risc-V after falling from $4000 to $1500. Solana is still betting on L1 after experiencing turbulence. However, it remains to be seen whether these initiatives can truly help them regain momentum.

Stablecoins are becoming a new form of currency. The market paradigm has fundamentally changed; ETH is no longer the primary currency, but stablecoins are.

The quality of market information is declining

Invalid information is eroding the entire market. From KOLs to trading platforms, it ultimately leads to trading behavior. This is not a criticism of individuals, but rather an acknowledgment of market laws. From early community activities to today's large-scale media promotions, the peak influence of KOLs also signifies the end.

The ineffective information in the current market mainly falls into two categories: first, low-quality calls targeting the sinking market; second, the platforming done by established institutions to maintain their presence.

Changes in the Investment Environment

The venture capital industry is also undergoing dramatic changes. Relying on US dollar capital, VCs in various regions are planning for the next stage. Meanwhile, Chinese VCs are facing dual pressures from LPs and ROI, moving further away from innovation and increasingly shifting towards a market-making role.

True innovation may emerge in emerging technology parks. Chinese founders need to seek funding support globally, but projects that can truly meet the market's next stage of demand may be difficult to be recognized by existing investment frameworks.

Industry Talent Mobility

The Crypto Assets industry is undergoing a major talent reshuffle. Professionals from the internet and finance sectors are flooding in, while the original practitioners either face legal risks or can only remain in lower positions. The industry is experiencing continuous institutionalization, which has become a shackle to its development.

New Asset Issuance Method

In each industry crisis, new asset issuance methods are born. For example, ERC-20 supported the development of DeFi, and NFTs promoted the rise of projects like BAYC. Now, we have arrived at the stablecoin stage.

Yield-bearing stablecoins (YBS) may become a new point of innovation. They may create new demand, not because existing stablecoins cannot meet market needs, but because YBS offers new possibilities.

Three Possible Development Directions for the Future

1. YBS has become a new asset issuance method, and Ethereum has successfully transformed. ETH may replace BTC as the new Crypto Assets engine.

2. YBS becomes a new asset issuance method, but Ethereum is stagnating. YBS may be absorbed by traditional financial assets, and the Crypto Assets industry may shift towards Fintech 2.0.

3. YBS failed to become a new asset issuance method, and Ethereum lost its status. Blockchain technology may shift towards "coin-less chain storage," becoming the Fintech 1.5 version.

Conclusion

Ethereum currently relies mainly on technical narratives, while users prefer stablecoins. The industry hopes that users will accept YBS, not just USDT. It may be too early to aggressively promote blockchain payments before new crypto assets like YBS become mainstream.

The Crypto Assets industry should not be limited to becoming Fintech 2.0, but should explore broader development space.