Metrics Ventures Market Observation: The market is in mid-term adjustment, waiting for the macro turning point

Metrics Ventures asserts that Bitcoin's current volatility confirms the market is only halfway through its cycle, despite peers declaring the bull market over. Key reasons include Bitcoin's trend alignment with USD risk assets, USD system adjustments, and a reaffirmed moderate macro-regulatory environment.
Ethereum-led altcoin weakness fuels market pessimism, but Bitcoin's decoupling from other crypto assets since April 2023 suggests the true macro liquidity bull market hasn't arrived. Uncertainty surrounds future capital flow paths.
The market is now in a re-consolidation phase, with Bitcoin's key support around $75,000. Historical trends of USD assets (e.g., AAPL) suggest no immediate cause for concern below this level.
Bitcoin's resilience is highlighted by its superior Sharpe ratio vs. Nasdaq assets, controlled on-chain supply, and regulatory actions interpreted as long-term positives.
The mid-term adjustment since February is seen as a prime opportunity for positioning ahead of a potential 15-month cycle, though the next bull market's capital flow may differ significantly from 2021.
Industry liquidation is accelerating, potentially aligning with the next macro liquidity bull market if sentiment and speed synchronize. Long-term holders of existing crypto assets are advised caution.

Note: The analysis includes a chart comparing BTC and Nasdaq strength over three years (not summarized in text).

Metrics Ventures, a secondary fund in the crypto market, released a March market observation guide:

1/ This month's market conditions have led many peers to call for the end of the bull market, but we firmly believe that the volatility of Bitcoin here just confirms the previous view that this round of market conditions has only reached the halfway point. This is mainly based on the trend fitting relationship between Bitcoin and US dollar risk assets, the reasons for the adjustment of the US dollar system at this moment, the re-strengthening of long-term logic, and the re-confirmation of the moderate macro-regulatory environment.

2/ The weakening of a large number of altcoins represented by Ethereum is the main pessimistic support for the market. As always, we adhere to the view of decoupling Bitcoin and other crypto assets since April last year. The real macro-supported liquidity bull market has not yet arrived. At the same time, we should also pay attention to the huge uncertainty in the next round of capital flow path.

3/ Looking ahead, we believe that the high turnover range formed here has been broken, confirming that the market has entered a period of re-consolidation and accumulation of momentum, but looking back at the historical trends of core US dollar assets such as AAPL, we believe that the real key support for Bitcoin is around 75,000, and there is no need to worry before that.

Inventory and comments on the overall market situation and market trends:

One of our core focus indicators for Bitcoin's current trend is Bitcoin's positioning as a risky asset in the US dollar system. The effectiveness of this observation is due to the fact that the switching of core assets in the US dollar system has always been gradual and driven by macro, regulatory, fundamental and other factors. Specifically, the following trend indicators we have observed are still strong:

① Bitcoin still has a clear advantage in Sharpe ratio over the Nasdaq and other "Seven Sisters" assets, and the resilience of Bitcoin has been verified again in a series of factors such as tariffs;

② The loosening of chips on the chain is not serious, especially in the release of negative news, it shows a stronger signal of acceptance rather than a signal of collapse, and the supply has not increased out of control;

③ From a regulatory perspective, we believe that the recent series of regulatory actions are significant long-term positive cornerstones. The market’s lack of understanding of the U.S. political and economic system is the main source of irrational fluctuations and will not change the long-term positive trend.

Combined with Bessent’s recent indication of the pace of risk release for the entire US dollar, we firmly believe that the mid-term adjustment cycle starting in February is an excellent opportunity to build positions in the next 15 months.

Finally, in our opinion, the industry's liquidation has finally entered a rapid period. If the liquidation period can resonate with emotions at a fast and strong amplitude, it may just catch up with the next macro liquidity bull market. However, we still need to remind you that the capital flow path of the next bull market may be completely different from that of 21 years. Therefore, the existing so-called crypto assets need to be extremely cautious from a long-term holding perspective.

Figure: The strength and weakness relationship between BTC and Nasdaq in the past three years