Decorate this mountain pass, it looks even better today.

Author: Metrics Ventures

1/ Following our April viewpoint, Bitcoin and global risk asset prices have clearly established a bottom this month as expected. For the first time in years, Bitcoin has become the best-performing dollar asset after the recovery from the liquidity crisis, which is encouraging. As of the date of this report, the actual operating price center of Bitcoin has already broken through the consolidation range of March.

2/ Looking at the entire month, after a massive turnover in the past three months, Bitcoin has actually entered a state of supply exhaustion, with the trading volume of longs and shorts remaining moderate. From the sentiment in the market, a large number of on-site traders are shorting the market and altcoins, which aligns with the judgment of many old coin circle participants based on fundamental chip theory and trading habits indicating a market top.

3/ There is no need to say much about altcoins. Although some newly listed tokens and the old stronghold altcoin represented by SUI have made price attempts, the overall performance remains unsatisfactory. It is hard to say that the profit effect will return before new liquidity and emotional peaks arrive. We are also seeing more and more crypto-related assets choosing to embrace SPACs, listings, and various liquidity acquisition channels in trading venues like Nasdaq. It can be anticipated that the flow of funds in the next liquidity cycle is quietly changing, and existing old altcoins are facing more severe challenges.

Market Overview and Commentary on Market Trends:

This month's market is significant. During the process of volatility convergence after large fluctuations, the strength and weakness of assets often represent trend changes. Bitcoin's strength has exceeded many participants' expectations. However, we believe this period highlights several very important points: 1/ Bitcoin still does not have a centralized selling pressure issue. Currently, most of the cleared assets are old coins and floating chips from trading, so the end of the cycle should be predicated on liquidity exhaustion and turning points, which is contrary to the actual trend of global liquidity;

2/ MicroStrategy's Q1 2025 report reveals a miracle in the history of capital markets. We believe this is not understood by the market. In short, MicroStrategy raised $7.7 billion in Q1 2025 through various means such as direct issuance, issuing convertible bonds, etc., which is higher than the $4.4 billion in Q4 2024. During the same period, MicroStrategy became one of the most resilient dollar risk assets despite a significant decline in U.S. stocks, with trading volume consistently ranking among the top ten in U.S. stocks, which is astonishing. Even more surprising is that, from the results, this is a stock that the entire market welcomes for reducing holdings and increasing issuance, a miracle in the history of human capital. The market has significantly underestimated MicroStrategy's actual financing and purchasing power, and the existing arrogance and prejudice may lead to greater emotional reversals in the future;

3/ If we previously believed that pricing power was merely "shifting" in 2024, we can now conclude that the handover of pricing power has been completed. The so-called old coin circle analysis framework will mostly be eliminated, and research on asset attributes, dollar cycles, and asset operation rules will be more rewarded by the market. The liquidity circulation path in the coin circle will also validate the aforementioned conclusions in the next round of emotional peaks.

Overall, we are very optimistic about the future trend of BTC, based on the inevitability of an increasing slope of liquidity growth and the divergence between actual trends and market participants' understanding.

Speaking of altcoins, we also believe that the current new altcoin operation model linked to U.S. stocks will be a key focus in the next emotional overflow cycle, worthy of attention from all peers.

Finally, let’s briefly discuss our views on RMB assets. The RMB's stunning turnaround from a fundamental perspective will, like the J-10CE shining in the India-Pakistan conflict, gradually make the world recognize it. This will step by step highlight the RMB assets entering a new upward channel, with the bottom continuously rising. The price divergence from the fundamentals here is due to the long-term bearish inertia, which is precisely the best layout interval. Global easing is already on the horizon, and the recently concluded high-profile financial statements are an important signal. Do not get lost in the chaotic American drama; global central banks have effectively made their choices.

To some extent, BTC in the eyes of crypto industry personnel is like A-shares in the eyes of the vast Chinese populace. What we want to convey is precisely connected, encapsulated in a poem as our reflection on the past market of the two major MVC-heavy industries and our outlook for the future:

Red, orange, yellow, green, blue, indigo, violet, who holds the colorful ribbon dancing in the sky?

After the rain, the slanting sun returns, the mountains are a deep blue.

In the fierce battle of the past, bullet holes in the village wall.

Decorate this mountain pass, it looks even better today.

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