Global macroeconomic pressures and challenges in the crypto market

In the past year, the global economic recovery has encountered obstacles. Although inflation in the US and Europe has somewhat eased, core inflation remains high, and major central banks continue to implement hawkish policies. As a high-volatility asset, cryptocurrency has been directly affected by the tightening of funds, becoming a heavy hit area for market sell-offs.

Geopolitical risk intensifies affecting capital flows

The Middle East conflict, tensions in the Asia-Pacific region, and the ongoing Russia-Ukraine war have increased demand for safe-haven assets. Compared to traditional safe-haven tools like gold and the US dollar, cryptocurrencies have become the preferred choice for capital outflows due to a lack of market consensus and regulatory clarity, indicating that their risk resistance capabilities still need to be strengthened.

Global regulatory tightening suppresses market vitality.

Many countries are strengthening regulation of cryptocurrencies. The US SEC is intensifying enforcement against trading platforms and DeFi, with some tokens being classified as securities, causing panic in the market. The EU and major economies in Asia are promoting transaction taxes, real-name registration for wallets, and cross-border regulation, leading to a decrease in trading activity and a significant reduction in capital inflow.

The risk of market leverage being too high and bubble bursts

Driven by AI narratives and the new public chain boom, market valuations are generally high, with obvious bubble phenomena. High leveraged operations lead to chain liquidations and stop-loss sales when prices adjust, causing sharp price declines and rapid evaporation of funds, exacerbating market liquidity risks.

Opportunities and Outlook in the Winter of the Market

Despite the challenges, historical experience shows that the bursting of bubbles and market adjustments simultaneously bring opportunities for resource restructuring and technological innovation. Investors should remain calm, focusing on projects with real value and application potential, to prepare for the future market recovery.