Is there still a season for altcoins in this market? | Q&A

1. Real Yield Market, Optimistic About the Potential of This Track

I estimate that the real yield market referred to by this reader means the on-chain assets generated after the tokenization of RWA assets?

If so, I have previously shared my views on this topic: the yield of assets in this track is essentially the yield of various financial assets in real life. The only difference is that this yield is distributed in the form of on-chain tokens (such as stablecoins).

In real life, a yield of around 10% per annum for financial assets is considered quite good, and a bit better would be an annual return of about 15% to 20% in the stock market.

However, this yield might not be attractive to the vast majority of users in the crypto ecosystem at this stage.

Regarding the future development of this track, my view is that for it to succeed, it must have regulatory support, and only traditional large institutions and big capital can navigate the regulatory landscape.

In the process of bringing RWA assets on-chain, those large institutions and big capital can earn substantial intermediary fees and transaction fees, so they have a strong incentive to promote the development of this track.

The recent development of this track has been very rapid; for example, Fidelity has already issued tokenized U.S. Treasury bonds on several Ethereum Layer 2 solutions.

However, I am curious about who would buy such tokenized Treasury bonds?

Would large institutions and big capital buy them?

They generally have smoother offline channels to buy directly, so why would they take a detour to buy on-chain?

Would retail investors and speculators trade them to profit from the price difference?

It would be better to play with MEME coins for that price difference.

Would they buy them for long-term investment?

Then it would be better to put stablecoins directly into AAVE or similar lending apps; even if the yield is slightly lower, it wouldn't be too different.

In summary, if it's for fun or novelty, I can understand buying a bit of these on-chain Treasury bonds, but I don't see the appeal in making large investments specifically to buy these bonds on-chain.

When I assess whether a track has potential, I pay special attention to my own interests. I look at whether I can participate in this track. If I can participate, what benefits can it bring me? Does this benefit have an advantage compared to the yields of other assets?

From these perspectives, the asset yields in the RWA track do not have much appeal to me at this stage. I will pay a little attention but won't invest too much energy in it.

2. Buffett is Out of the Question, but If Duan Yongping Changes His Mind and Enters the Crypto Market, It Would Have a Significant Impact

Buffett and Duan Yongping often mention in their speeches that they do not understand many industries or many assets.

Duan Yongping has also said that it took him several years to understand XXX or that he still does not understand XXX after several years.

For investors of this caliber, when they say they "do not understand," it is generally impossible for outsiders to change their views. One should not expect that just anyone can change their opinions with a few words.

Only they themselves can change their views.

On the other hand, another senior figure, Dan Bin, has been paying attention to Bitcoin and has invested in it.

Actually, I don't really care how they view things; I believe my understanding of this field is deeper than theirs.

For investors of this caliber, I think focusing on their alternative views on crypto assets is not very meaningful. It is more meaningful to learn investment wisdom and thinking from them.

They have reached a top level among their peers in the fields they are deeply involved in; can we achieve a top level among our peers in the fields we are focused on?

3. Will There Be Altcoin Seasons in the Future? Does Ethereum Layer 2 Still Have Potential?

Yesterday's market seemed to have a small "rehearsal."

During Ethereum's rise to $2800, mainstream DeFi tokens surged.

The market interprets this as: after Trump takes office, there may be a relaxation of regulations on the crypto industry, and within the crypto ecosystem, DeFi is undoubtedly the most scrutinized subfield.

Thus, the market interprets this as: after regulatory relaxation, DeFi will have new developments, attract new users, and expand new markets, hence the tokens received positive stimuli.

However, it is important to note that the tokens that rose, especially those with significant increases, are well-known DeFi project tokens.

So, by analogy, even if there is an altcoin season in the future, it will only be for well-known blue-chip project tokens, not just any token.

I estimate that Ethereum Layer 2 will have a similar effect, but the prerequisite is that there must be a strong application ecosystem for their prices to rise.

Once a certain Layer 2 expansion's application ecosystem takes off, and its token is stimulated positively, this effect will also transmit to other Layer 2 expansions.