Huobi Expert Forum | HTX Research Chief Analyst Andy: Analyzing the Investment Logic of the Q3 Cryptocurrency Market

On July 20, Andy Liu, the head and chief analyst of HTX Research, was a guest at the fifth session of the Huobi Celebrity Lecture, discussing "Q3 2026 Outlook: A New Order in the Crypto Market Under Global Liquidity Repricing." He analyzed global liquidity repricing, changes in the structure of the crypto market, trends in core assets, and future investment opportunities.

As a guest speaker for this session, Andy Liu has long been deeply involved in the crypto industry, with a composite background in investment management, institutional services, on-chain data analysis, and industry research. He is currently responsible for the overall research system construction at HTX Research, covering multiple dimensions such as macro market linkage, industry trends, and CEX asset strategy research.

Q2 Market Adjustment: Repricing Under Changes in Global Funding Costs

Reflecting on the market performance in Q2 2026, Andy noted that the price of Bitcoin fell from a peak of about $82,000 in mid-May to a temporary low of around $59,000 in June, with a maximum drawdown of nearly 24%. However, this does not signify "the end of the crypto industry cycle," but rather a concentrated repricing under the contraction of global dollar liquidity.

For the Q3 crypto market, Andy made three core judgments:

Liquidity is more important than geopolitics: Short-term events may affect market sentiment, but the true determinants of trends are energy prices, inflation, Federal Reserve policies, and the movement of the dollar.

Cash flow is more important than narrative: The market is no longer paying for grand narratives and inflated TVL; protocols must have real income, burn mechanisms, and value capture mechanisms.

Infrastructure is more important than price: Price corrections have not hindered infrastructure expansion. RWA, stablecoins, on-chain securities, AI Agent payments, and institutional compliance channels are still progressing. The long-term direction of Crypto is shifting from a native asset trading market to a part of global financial infrastructure.

In-depth Analysis of Hot Assets: Where is Institutional Money Flowing?

Regarding the performance of core crypto assets that the market is focused on, Andy Liu analyzed BTC, ETH, DeFi, RWA, and other key sectors in conjunction with the liquidity environment, institutional capital allocation, and asset value capture capabilities.

BTC (overweight) has become a variable for global liquidity: BTC is no longer just a native crypto asset but a core expression tool for global liquidity. The core variable for Q3 is whether spot ETF funds return to normal, as well as the direction of Federal Reserve policies and the pace of Treasury bond issuance. BTC remains the primary entry point for institutional allocation, possessing strong defensiveness and elasticity.

ETH (neutral/tactically long) faces value capture challenges: Layer 2 has improved network efficiency but weakened mainnet fee income. The current pain point for ETH is that ecological growth has not effectively fed back into token value. The valuation recovery for ETH in Q3 needs to closely monitor three catalysts: a rebound in L1 fees and burn volume, net inflows of ETF funds, and favorable regulatory stimuli. DeFi (selectively overweight leaders) is entering a cash flow era: The era of valuing solely based on TVL (Total Value Locked) is over. "Quality DeFi" with real income return mechanisms, strong risk isolation capabilities, and deep integration with compliant funds will see a revaluation.

RWA (continuously overweight) is a structural mainline that transcends cycles: In a high-interest-rate environment, tokenized RWA assets, such as U.S. Treasury bonds, provide a natural yield outlet for on-chain funds. Its growth does not rely on bullish market sentiment but is based on real institutional compliance allocation needs, making it one of the most certain sectors currently.

Long-tail Altcoins (underweight): In the context of insufficient stablecoin expansion, significant unlocking pressure, and limited liquidity, long-tail altcoins lack a solid foundation for a comprehensive breakout.

Andy concluded that the Q3 Crypto market will not be driven by a single narrative but will be jointly determined by two main lines—whether global liquidity improves marginally and whether regulatory certainty is sufficient to reopen institutional risk budgets.

Regulation Shifts from Risk Discount to Market Catalyst

Regarding regulatory trends, Andy believes that in the past few years, regulation has been viewed more as a risk factor by the market, affecting asset valuations through risk discounts. However, as the industry matures, regulatory certainty is becoming a new market catalyst.

He emphasized that the market is not concerned with whether regulation is looser, but whether the rules are clear. "The clearer the rules, the easier it is for institutions to judge which assets and businesses can enter their balance sheets."

In the Q3 market outlook, Andy believes that regulatory advancement is more important for assets such as Ethereum, DeFi, stablecoins, and RWA. Compared to Bitcoin, which already has ETF and mature institutional entry points, these areas may have greater regulatory improvement elasticity in the future.

At the end of the live broadcast, Andy concluded the session with a statement: "The Q3 market will not reward all risks; it will only reward risks supported by liquidity, with real cash flow, and with clear regulatory pathways."

Hot Topics Q&A: ETF, Four-Year Cycle Theory, and the "Altcoin Dilemma"

During the interactive segment of the live broadcast, Andy provided in-depth answers to several market phenomena that the audience was most concerned about:

About "Success and Failure of ETF": Regarding Bitcoin's recent significant fluctuations due to ETF fund outflows, Andy believes that ETFs are not the sole determining factor for the market but rather an "amplifier." The addition of ETFs has amplified Bitcoin's sensitivity to macro liquidity, allowing traditional institutions to quickly adjust their positions. The true engine for market movements remains the improvement of global liquidity. Moreover, the inflow of ETF funds does not equate to blind bullishness, as it includes a large amount of basis trading and hedging operations.

About whether the "Four-Year Cycle Theory" has failed: Andy believes that the "halving cycle" occurring every four years has not failed, but it has transformed from an "iron law" into a "reference for supply rhythm." With Bitcoin's supply now vast and deeply integrated into the global asset allocation system, a super bull market will only erupt when the "supply contraction of the halving cycle" resonates with the "liquidity cycle of dollar expansion."

Revealing the Truth Behind "Altcoin Liquidity Drought": Why has the market capitalization of stablecoins recently reached new highs, while the vast majority of altcoins continue to decline? Andy pointed out four reasons: First, institutional funds are entering BTC through ETFs and are no longer rotating down to altcoins as they did in the past; second, the use cases for stablecoins have greatly expanded (such as cross-border payments, RWA), and the issuance of stablecoins does not equate to "lining up to buy altcoins"; third, the supply of altcoins is high, facing significant unlocking pressure and early investor exits; finally, the market has become immune to "narrative coins" that lack real value capture.

The Huobi Celebrity Lecture is a long-term educational program created by the Huobi Growth Academy, aimed at inviting top scholars, industry leaders, and experienced practitioners from around the world to engage in in-depth discussions on cutting-edge fields such as the crypto industry, artificial intelligence, and Web3, helping users understand the underlying logic behind market trends and establish independent thinking frameworks.