The crypto market is not short of money, and funds are waiting for new wealth effects

The current crypto market sentiment is extremely depressed, even more depressed than the bottom of the bear market. The operation is extremely difficult, and investors generally feel confused and anxious. However, analysts at the StarEx exchange believe that this dilemma is not due to a lack of money in the market. Data shows that the supply of stablecoins has exceeded 225 billion US dollars, setting a record high. In the first two months of 2025 alone, the two major stablecoins issued an additional 10.75 billion US dollars. Obviously, there is no shortage of funds, but the liquidity of the market is severely divided. Funds only dare to hold Bitcoin, and other cryptocurrency investors lack confidence, and even feel that the decline is endless.

As the "leader" of cryptocurrencies, Bitcoin is backed by institutions and is the mainstay of the market. However, even for Bitcoin, the purchasing power of institutions is weak now. Whether it is large retail investors, ETFs or whales, it is difficult to push its price up further. But other cryptocurrencies besides Bitcoin make investors feel uneasy. There are a large number of altcoins, and tens of thousands of projects are constantly being released, which continue to suck blood from retail investors. Meme coins have recently suffered a cliff-like collapse, with trading volume falling by more than 80%, and there are many projects with price drops of more than 90%.

Analysts at StarEx Exchange believe that the decline of meme coins has caused the only hot spot in the market to extinguish, and the wealth effect has been further reduced. From national presidents to Internet celebrities, everyone is trying to cut leeks by issuing meme coins. However, the problem is, where are there so many leeks to cut in the market? The collapse of meme coins not only caused heavy losses to investors, but also greatly frustrated market confidence, which is also one of the core reasons for the sluggish market performance.

The crypto market is not short of money. Institutions and big investors hold a lot of funds, but they are not in a hurry to enter the market. On the contrary, as soon as the market rises, institutions can't wait to start harvesting. This situation makes it difficult for the market to form a sustained upward trend, and it is extremely difficult to operate. For ordinary investors, the current market environment can be called "hell level".

So, how can the market get out of the predicament? StarEx exchange analysts believe that there are only two possibilities: one is that the market plummets again, creating space downward, especially through a plunge that triggers stampede and washes out the bloody chips; the other is the emergence of new ecological opportunities. No matter what the market is like, new ecological opportunities can always inadvertently break out and bring new wealth effects.

In such a market environment, investors need to be more cautious and patient. If you are a gambling investor, you can take advantage of the bad market conditions to choose some low-market-cap, conceptual and hot projects to pay attention to, hoping that there will be a wind blowing in the future and gambling on their opportunities for a big rise. However, this strategy is high-risk and requires a strong risk tolerance. It is not recommended to operate with a heavy position.

For conservative investors, the best strategy may be to wait. When the market falls back, you can do some short-term operations, buy low and sell high, and withdraw when you make 10%-20%. Don't be too ambitious. In the current market environment, it is particularly important to maintain patience and discipline.

Where are the new wealth opportunities? StarEx exchange analysts believe that after the market calms down from the fomo hype of meme coin PVP, the long-suppressed Ethereum ecological tokens are worth paying attention to. The bottom risk is not great, and a large number of institutions build business ecosystems based on its network, such as RWA, NFT, web3, stablecoin payment and other applications, which bring expectations for possible ecological explosion in the future.

Whether the market can get out of trouble in the future depends on whether new ecological opportunities will emerge or whether the market can wash out the bloody chips through a sharp drop. Before that, investors need to remain patient, operate cautiously, and wait for the market to turn around.