Crypto market macro research report: The U.S. government shutdown has led to a contraction in liquidity, and the crypto market is facing a structural turn

# I. Overview of the Current Market Macroeconomic Background  

In November 2025, the global crypto market stands at a structural turning point: it is neither the full-fledged onset of a new bull market nor passive defense against a downward spiral, but rather a critical window of "shifting from virtual to real, returning from narratives to technology, and moving from pure speculation to structural participation." The root cause driving this transition lies not in a single price movement or policy, but in an overall shift in the macroeconomic paradigm. Over the past two years, the post-pandemic era’s aggregate demand management, dominated by fiscal expenditure and balance sheet expansion, has gradually receded. The cycle of neutral-to-tight monetary policy has clearly peaked, the government’s direct traction on liquidity has weakened, and the private sector has regained dominance in capital allocation. New technological narratives and the revaluation of production functions have begun to reshape the underlying logic of asset pricing. Policy focus has shifted from "stimulating nominal demand through subsidies and transfer payments" to "driving potential growth through efficiency and technological progress." Amid this transition, the market is willing to pay a premium for assets with "verifiable cash flows and a clear technological expansion curve," while adopting a more cautious stance toward targets characterized by "high leverage, strong procyclicality, and growth reliant solely on valuation expansion."  

According to the latest data, the total market capitalization of the current crypto market is approximately $3.37 trillion, down from its previous peak—indicating a phased withdrawal of capital and reduced risk appetite. This is compounded by a Fear & Greed Index reading of 20 (classified as "Fear"), signaling weak sentiment. Overall, the market remains in a mid-term correction within a long-term upward structure: the upward trend from 2023 to 2025 remains intact, but short-term uncertainties in macroeconomic expectations, profit-taking by investors, and liquidity contraction have pushed the market into a phase of consolidation and digestion. In summary, the long-term trend remains unbroken, but sentiment has cooled, placing the market in a "fear-driven correction zone"—more akin to a period of position rotation and divergence within a bull market.  

The current crypto market Fear & Greed Index stands at 20, firmly in the "Fear" range, and has continued to weaken compared to the previous week and month. As indicated by market charts: Bitcoin’s price has retreated from its highs over the past few months, and market sentiment has shifted sharply from "Greed" to "Fear," accompanied by declining trading volumes—signs of capital hesitation and reduced risk appetite. However, this zone also aligns with historical levels that have repeatedly corresponded to mid-term bottoms or value-oriented allocation opportunities: the weaker the sentiment, the more likely long-term capital is to start accumulating positions. In other words: short-term pessimism and increased volatility persist; yet in the medium to long term, the fear zone often nurtures opportunities for contrarian investors.  

From a macroeconomic perspective, take the United States as an example: following the Federal Reserve’s aggressive interest rate hikes between 2023 and 2025, while inflation has not yet fully returned to its long-term target, the marginal stickiness of core prices has weakened. The combined effects of supply-side recovery and a downturn in the inventory cycle have driven a structural moderation in inflation. The Fed’s policy communication has gradually shifted from a hawkish "higher for longer" stance to a "data-dependent wait-and-see with mild easing" path, and the interest rate expectation curve has loosened downward. Meanwhile, the U.S. Treasury is making "secondary adjustments" to address the aftermath of large-scale deficits and short-duration bond issuances during the pandemic: tighter budget constraints, optimized maturity structures, and marginal reductions in subsidies and transfers. This means liquidity is flowing back from the public sector to the private sector—not through unconditional flooding, but through the redistribution of market-based credit and equity-bond risk premiums into more efficient and growth-oriented asset classes. On the other hand, the U.S. government shutdown has set a record: the Treasury General Account (TGA) has seen inflows without outflows due to the shutdown, with its balance swelling from approximately $800 billion to over $1 trillion—equivalent to siphoning about $200 billion in liquidity from the market and exacerbating funding strains in the banking system. This explains why high-leverage cyclical assets in traditional markets are under pressure, while underlying technology, AI supply chains, and digital infrastructure enjoy higher "valuation tolerance": the former relies on the tailwinds of low interest rates and high nominal demand, while the latter benefits from improvements in production functions and leaps in total factor productivity, favoring a shift from "price-driven" to "efficiency-driven" growth.  

This macroeconomic shift is reflected in risk assets through structural divergence: on one hand, the lagged effects of high interest rates persist, credit spreads have not narrowed to extremely low levels, and capital remains wary of assets with no profit support, uncertain long-term cash flows, or highly leveraged balance sheets. On the other hand, sectors with visible cash flows, high demand elasticity, and alignment with technological trends are attracting active capital allocation. For crypto assets, this translates to a shift from the previous "Bitcoin-dominated, capital-siphoning rally" (single-core logic) to a "Bitcoin stability → capital rotation to smaller assets → accelerated narrative cycles" (multi-core logic). Driven by the increased proportion of institutional holdings, improved spot ETF channels, and optimized on-chain derivative structures, Bitcoin’s volatility has significantly converged, and it is gradually assuming the role of a "risk-free collateral base": not "absolutely risk-free" in the strict sense, but rather "the most liquid, transparently traded, and cycle-resilient collateral relative to the broader market." Ethereum has not experienced a rally on par with Bitcoin, but its systemic importance in settlement layers and developer ecosystems has made it more of a "risk liquidity aggregator"—when market risk appetite rebounds, capital no longer lingers in large-cap assets but flows through ETH and Layer-2 (L2) solutions to earlier-stage, higher-elasticity ecosystem assets. Thus, the most distinct structural trends in November can be summarized by three inequalities: **rotation > concentration, active participation > passive holding, and hot-topic capturing > waiting for large-cap rallies**. Capital behavior has shifted from "waiting for opportunities" to "organized pursuit," and the key trading capability has transitioned from "value discovery" to "narrative identification + liquidity tracking + mechanism prediction." Among all narratives, sectors that simultaneously satisfy "technology-driven growth and attention momentum" have attracted the most substantial new capital:  

- **Layer-2 (L2)**: Due to its high launch frequency, cost advantages, and incentive designs, it has become the most effective "innovation distribution channel";  

- **AI/Robotics/DePIN**: By connecting to real-world production functions and linking to Machine-to-Machine (M2M) economic cycles, these sectors exhibit "higher convexity at earlier stages";  

- **InfoFi**: As an exploration of the financialization of knowledge and data value, it aligns with the era’s principle that "attention is a scarce resource";  

- **Memecoins**: Represent the ultimate manifestation of "attention monetization,"承载ing the rapid realization of sentiment and social capital with extremely low friction costs;  

- **NFT-Fi**: Has shifted from "avatar popularity" to a more practical paradigm of "on-chain rights and cash flows," unlocking new collateral, rental, and profit-sharing scenarios through financial structuring tools;  

- **Presales**: Positioned in a "sweet spot" of "low valuations, weak initial distribution, and convex returns," they serve as the most cost-effective high-volatility factor in risk budgets.  

The common core across these directions is the "convergence of four forces": attention, developer contribution, incentive mechanisms, and narrative consistency. Attention provides visibility and capital handoff; developer contribution determines the sustainability of the supply curve; incentive mechanisms solve the cold-start problem in the early expansion stage; and narrative consistency aligns expectations with implementation paths, thereby reducing discount rates.  

From a broader perspective, the medium-to-long-term return potential of traditional financial assets is constrained in two dimensions: first, while Treasury yields have peaked, they remain at high levels, compressing the valuation elasticity of equity assets; second, global real growth momentum is weaker than in previous cycles, and further expansion of corporate profits relies more on efficiency than price increases. In contrast, crypto’s advantage lies in the "synchronization of technological cycles and financial innovation cycles": on one hand, the full-chain improvement of on-chain infrastructure—from performance and costs to development tools—has significantly reduced the marginal costs and trial-and-error scope of applications; on the other hand, tokenization mechanisms and incentive engineering provide a "consensus coordinator" for "capital-users-developers," thereby finding measurable, iterable, and distributable solutions to the cold-start problem of the Internet era within on-chain ecosystems. In other words, the risk compensation for crypto assets is no longer driven solely by volatility and leverage, but increasingly depends on "whether mechanism design can convert attention, data, and computing power into realizable cash flows." When this aligns with the structural release of macro liquidity, the risk-adjusted return curve of crypto assets demonstrates a relative advantage over traditional assets.  

In terms of monetary conditions, the market is undergoing a transition from "expectations of nominal easing" to "actual neutrality," and then to "structural partial easing." The direction of policy rates is no longer unilaterally tightening; the structure of Treasury supply has become more refined; marginal improvements in credit conditions have driven down private financing costs; refinancing pressures on existing assets have eased; and technology and innovation supply chains have become the primary beneficiaries of capital inflows. This rhythm implies that crypto has entered the early-to-middle stage of "risk appetite recovery"—unlike previous rallies that relied solely on quantitative easing, this cycle is more of an "endurance race" driven by the combination of "technological progress + narrative evolution + mechanism optimization": the rally will not be a "single sharp surge," but a "multi-core driven, phased advance." Thus, the most intuitive market phenomenon is not "Bitcoin soaring alone," but "BTC stabilizing the foundation, ETH maintaining its hub role, and L2/AI/InfoFi/Memecoins rotating in groups." In this context, "early positioning → phased profit-taking → re-rotation" is the main theme, and the logic of "concentrating on one sector indefinitely" has marginally faded; capital requires strategic capabilities for "sustaining growth through active trading."  

In summary, the macroeconomic transmission chain at this stage can be described as: fiscal retreat and deficit management → liquidity returning to the private sector → downward loosening of interest rate expectations and credit condition recovery → capital preference for "efficiency and curve convexity" → higher discount rate tolerance for technological narratives → crypto market shifting from single-core to multi-core → structural rotation becoming dominant. As of November, our assessment is: the global macroeconomy has not yet fully shifted to easing, but structural incremental liquidity is being released. Combined with the critical breakthrough of the technological cycle and the maturity of distribution mechanisms, crypto assets are moving toward a medium-term pattern of "coexisting group narratives" rather than "single-market driven growth." Its defining feature is a "partial bull market + structural bull market"—its sustainability does not depend on the weekly chart of a single asset, but on the mutual verification of multiple subsystems within the ecosystem:  

- Developer retention and toolchain improvement verify supply;  

- User growth and fee curves verify demand;  

- Incentive budgets and governance improvements verify mechanisms;  

- Cross-chain settlement and compliance channels verify capital sources.  

Under the condition of sustained positive feedback across these variables, the market becomes healthier, more diversified, and requires more professional and disciplined "active participation." Therefore, the key to seizing opportunities at this stage is not to guess "which coin will be the next breakout star," but to establish an integrated framework of "macroeconomics → narratives → mechanisms → liquidity → distribution":  

- Identify directional changes in interest rates and deficits at the macro level;  

- Judge whether the technological curve aligns with demand at the narrative level;  

- Examine the sustainability of incentive designs at the mechanism level;  

- Track real migrations in fees, market-making, and social traffic at the liquidity level;  

- Evaluate the comprehensive efficiency of presales, airdrops, rankings, points, NFT-Fi, and social media matrices at the distribution level.  

Only when this framework is closed can the three inequalities—"rotation > concentration, active > passive, hot topics > large caps"—avoid becoming empty slogans and instead be transformed into executable, trackable, and reusable strategic methodologies.  

# II. Sector Analysis and Macroeconomic Outlook  

Entering the 2025–2026 crypto market, the most critical drivers have quietly undergone a structural shift. While interest rates and macro variables still form the underlying beta of the market, the sources of significant excess returns have shifted from "macroeconomic sentiment → asset pricing" to the "triple resonance of narratives × technology × distribution mechanisms." The new cycle is characterized by the accelerated evolution of technological foundations, shortened narrative dissemination chains, and more decentralized capital distribution—bringing unprecedented price elasticity and style rotation speed. Against this backdrop, **Presales, Memecoins, AI×Robotics×DePIN×x402, InfoFi, and DATs (Digital Asset Treasury companies, quasi-publicly traded crypto-equity firms)** have emerged as the most directionally certain main themes for the next 6–18 months.  

### Presales: The Clearest Structural Opportunity Window  

Presales will be the clearest and most structurally rewarding opportunity window in the coming year. Their advantage stems not from "undervaluation" in the traditional sense, but from their time structure and distribution structure. Early-stage tokens feature low valuations, relatively opaque market information, and high entry barriers—creating significant information asymmetries and execution gaps. Many investors may be aware of a project, but unable to secure allocation quotas; those who obtain quotas may lack a plan for post-Token Generation Event (TGE) distribution or reinvestment; and even those who know how to exit may struggle to identify new entry points for the next round. The true alpha lies not in "knowing about a project," but in completing the full cycle of "awareness → quota acquisition → exit → reinvestment." Whether for new L2 asset issuances, AI-native projects, InfoFi builders, or Meme primitive experiments, their early stages (via presales) can unlock return potential of 20x–50x. The key to presales is not "betting on the right project," but deeply embedding oneself in information networks, capital networks, and distribution networks to convert information advantages into executable profit cycles. This means that in the new cycle, outstanding participants are not just researchers, but executors.  

### Memecoins: The Eternal Narrative of Attention Arbitrage  

Closely tied to presales is the eternal narrative of Memecoins. Memecoins are never about value investing, but the materialization of attention economics and narrative arbitrage—serving as the most agile alpha carriers in the crypto space. Over the past two cycles, the main battlefield for Memecoins has shifted dramatically: from BSC in 2021 to Solana in 2023–2024, and now to the dual hubs of Solana and Base in 2025. The logic is straightforward: blockchains with faster transaction speeds, lower costs, and stronger community mobilization capabilities are better suited for Memecoin execution. The core of a Memecoin lies not in "what it is," but in "who is promoting the narrative, who is driving adoption, and who is managing distribution"—forming a high-speed cycle of "narrative → attention → liquidity → pullback → reconstruction." Once a cross-market narrative takes shape, an asset can surge dramatically within weeks and complete distribution rapidly. At its core, this represents the market reaching consensus on a symbol in a short period and conducting tangible speculative activities on-chain. While risks are extremely high, their high agility, rapid iteration, and explosive growth make them an unavoidable expression of each cycle.  

### AI×Robotics×DePIN×x402: The Definitive Tech-Driven Long-Term Trend  

In contrast to the more tactical sectors above, **AI×Robotics×DePIN×x402** represents the most certain tech-driven main theme of the new cycle, poised to spawn a long-term megatrend on par with Bitcoin’s early growth. The value of AI is never limited to cognition itself, but lies in its integration as an economic agent into production systems. When AI models evolve into autonomous agents capable of executing tasks, signing transactions, settling payments, and self-maintaining on-chain, machines will become economic units—forming a "Machine-to-Machine (M2M)" economic structure. Blockchain provides machines with identity, settlement, and incentive systems, enabling them to participate in economic cycles. The importance of x402 lies in creating Internet-native infrastructure for automated payments and settlements, allowing AI agents to exchange value and giving rise to entirely new asset forms such as machine wallets, on-chain rental markets, robotic asset rights, and automated yield generation. The current stage remains extremely early, and business models are not yet finalized—but it is precisely this that creates massive expectation gaps, making it the most promising "tech × finance" intersection in the coming years. Key assets such as CODEC, ROBOT, DPTX, BOT, EDGE, and PRXS are all building around machine identity, computing power incentives, and AI agent economies. **AI×Crypto** is essentially immune to regulatory cycles because it is driven by technological expansion, not policy preferences—positioning it as a structural trend on par with "the birth of the Internet" or "the popularization of smartphones."  

### InfoFi: The Most Innovative Narrative of the New Cycle  

Meanwhile, **InfoFi (Information Finance)** has emerged as the most innovative narrative of the new cycle. It is not simply "selling information," but transforming knowledge contribution, verification, and distribution into measurable, incentivized economic activities. In traditional Internet ecosystems, the economic returns from information are mostly captured by platforms; in InfoFi, contributors, validators, and distributors all gain equity—forming a "tripartite win-win" structure. Its core mechanism is: **Create (Contribute) → Validate (Verify) → Rank (Sort) → Reward (Incentivize)**. Once value is expressed on-chain, it becomes a tradable, composable asset—giving rise to a new market structure that combines the traffic of Web2 TikTok, the analytics of Bloomberg, and the incentives of DeFi. InfoFi solves the problems of high information noise and distorted incentives in Web2, while opening up opportunities for analysts, judges, and organizers to profit. Typical platforms include wallchain, xeetdotai, Kaito, and cookie3—transforming information from "private intellectual assets" to "public digital equity" and representing a highly noteworthy intersection of narratives.  

# It is worth emphasizing that the direction of DAT (Digital Asset Treasury), also commonly known as the "Crypto-equity" track in the market, will become one of the structural investment themes in the next 6–18 months. The core logic of DAT does not rely on business operations; instead, it channels the valuation of on-chain assets into traditional capital markets through the shell of a public company plus cryptocurrency asset positions. Its principle is as follows: a company allocates its cash assets to mainstream cryptocurrencies such as BTC, ETH, SOL, and SUI, manages these assets through methods like position market value, staking returns, and derivative strategies, and reflects this market value in the company’s stock price. This forms a cross-market price transmission mechanism of "on-chain assets → secondary stock market". MSTR (MicroStrategy) is the earliest example. Starting from 2025, SUIG, a SUI treasury company, will become a new representative. It holds over 100 million SUI tokens, with a market value of approximately $300–400 million. By combining the "public company + treasury strategy" with ecological narratives, it provides investors with a new asset allocation method. The advantages of DAT are twofold: on one hand, it serves as a compliant bridge for traditional funds to enter the crypto market; on the other hand, it maps Crypto Narratives to the TradFi pricing system, thereby forming a new two-way capital cycle of "Web3 assets → Nasdaq consensus". In the next 6–18 months, DAT will focus on "SUI, SOL, and AI Narratives", with potential directions including treasury structure optimization, staking return growth, asset diversification (BTC, ETH), and synergy with L1/L2 strategies. Such assets possess the composite attributes of "longing for ecology + longing for tokens + longing for risk premium" and are new capital tools with strong penetration.

Comprehensively speaking, the main theme of the future crypto market will be "narrative rotation × distribution efficiency × execution capability". Presales and Memecoins provide high-frequency alpha; AI×Crypto offers long-term beta combined with structural alpha; InfoFi reconstructs the value capture mechanism; and DAT builds a capital bridge between Web3 and traditional finance. The winners of the new cycle will not be "those who know the most", but "those who complete the cycle of cognition → participation → distribution → reinvestment". Information is not an asset; execution and circulation are the real assets. The genuine growth model lies in achieving capital compounding during the narrative cycle by continuously participating in early-stage opportunities and integrating into the distribution system. In the next 6–18 months, the crypto market will shift from being "macro-driven" to "technology and narrative-driven". This is not a cycle that merely requires patience, but one that demands action. The combination of Narrative × Technology × Distribution will shape the next generation of winners, and the acceleration structure has already begun.

# III. Risks and Challenges

Looking at the coming year, although the structural opportunities in the crypto market are clear, the macroeconomic environment still faces unavoidable external risks and systemic challenges. These variables not only determine the pace of liquidity release but also profoundly affect the intensity of narratives, asset valuations, and the boundaries of industry expansion. The greatest uncertainties stem from regulation, on-chain operational complexity, multi-chain fragmentation, user cognitive costs, the asymmetry between narrative rhythms and information structures. Moreover, these factors implicitly involve cycle mismatches between institutions and retail investors, which constitute inherent barriers to strategic competition. Against the backdrop of a long-term structural bull market, these risks do not necessarily block the trend, but they will determine the steepness of the yield curve and the range of volatility.

Regulation has always been a key variable affecting the medium- and long-term resilience of crypto assets. Although the U.S. has released some positive signals through policy easing, represented by spot ETFs, the regulatory framework still exhibits characteristics of fragmentation, multi-centralization, and lag. The intensity of legislation struggles to keep pace with the growth of asset scale. For institutions, regulatory clarity determines the upper limit of asset allocation; for retail investors, the direction of regulation affects confidence and risk appetite. There are still frictions in Europe and the U.S. regarding exchange regulation, anti-money laundering, custody standards, and the identification of DeFi compliance responsibilities. It will be difficult to form a unified stance in the short term, which may trigger localized policy headwinds or disruptions. On the other hand, the Asian market has made relatively active progress in promoting license systems and regulatory sandboxes, but structurally, it also remains in a cycle of "increasing openness → regulatory testing → institutional caution → application exploration". It can be predicted that regulatory uncertainty will continue to affect cross-border capital flows and maintain the market’s pricing stratification between "compliant assets and gray assets". This means that although there will be no systemic regulatory shocks in the coming year, gradual regulatory constraints will become a force suppressing valuations, especially posing risks to assets with high volatility, untraceability, and no clear structural returns.

On-chain operational complexity also restricts large-scale adoption. Despite significant improvements in development tools and user experience over the past two years, on-chain interactions still involve multiple links and thresholds: users must proactively understand processes such as signing, authorization, cross-chain operations, Gas management, and risk assessment. Although wallet logic has been improved, it still fails to achieve the implicit process experience of Web2. For on-chain applications to reach "Internet-scale adoption", they need to enable most users to access them seamlessly, rather than relying on groups with high cognitive abilities. Currently, the interaction between wallets and protocols still leans towards an engineer-centric language, and users must go through multiple steps including "wallet → signing → Gas → risk → execution". Errors in any step can lead to losses, and the existing protection system is still unable to fully cover such risks. In other words, operational complexity leads to an underestimation of the actual number of market participants. This means that driven by narratives, real funds cannot be quickly converted into active users, forming a "traffic-value" conversion bottleneck. For project parties, this limits their growth and distribution capabilities; for investors, it becomes a delaying factor in the realization of narratives; for institutions, it increases the difficulty of compliant operations and user protection. The parallel development of multiple chains has accelerated competition, but also intensified fragmentation. The boom in L2 has brought about ecological prosperity, but at the same time, it has scattered funds and users across multiple execution environments. Standards vary between different ecosystems, data cannot be fully interconnected, and cross-chain asset transfers face bridge risks, ultimately increasing systemic uncertainty. Due to the fragmented nature of liquidity, it is difficult for a single-chain ecosystem to form an accelerated cycle of "scale → depth → innovation", and cross-chain bridges create security gaps in the market. In the past few years, most large-scale hacker incidents have been related to cross-chain components, making it difficult for institutions to use cross-chain assets and deterring retail investors from taking on the risks of cross-chain liquidity migration, resulting in structural inefficiencies. At the same time, multi-chains have led to narrative overload. Users cannot quickly judge the true connection between "ecology → assets → mechanisms", which disperses attention, raises research costs, and further exacerbates information asymmetry.

User cognitive costs remain an inherent obstacle to the development of the industry. From payment logic, asset management, risk models, and incentive design to narrative judgment, the crypto industry not only requires users to have financial literacy but also demands an understanding of multiple elements such as cryptography, game theory, and economic mechanisms. The industry still lacks mature financial education and mechanism transparency, leading most participants to enter with a "speculative mindset", making it difficult to form a stable participation structure. Against the backdrop of rapid narrative iteration, user education always lags behind, allowing users with high cognitive abilities to benefit, while those with low cognitive abilities are more likely to become victims of liquidity depletion. The heavier the cognitive burden, the greater the risk of centralization. The uneven distribution of funds leads to a barbell-shaped structure: on one end are elite executors, and on the other end are blind participants lacking knowledge, resulting in a serious imbalance in profit distribution.

Short narrative cycles and highly inward-looking sentiment have led the market to show a tendency towards "ultra-short-term trading". In an environment where information spreads at high speed, the update speed of main-line narratives is significantly faster than the actual development pace of projects. This causes a disconnect between project value and price, with narrative peaks prematurely overdraw expectations, making it difficult to translate into long-term results. Projects are forced to chase narratives to attract attention, and even use high incentive subsidies to gain short-term activity, rather than building structural value. Inward-looking sentiment has transformed user behavior from "research → judgment → action" to "following the trend → speculation → escape", making the market exhibit pulsed rotation. Although excess returns can be generated in the short term, it will damage the developer ecosystem and capital accumulation in the long run, thereby affecting the industry’s fundamentals. The uneven distribution of alpha information is one of the core structural challenges in the industry. On-chain data is transparent, but the information structure is highly stratified. High-level players master composite information including capital flows, incentive structures, distribution paths, development progress, and social expectations, while ordinary participants can only make judgments based on secondary dissemination and social media noise. With the rise of mechanisms such as presales, points, airdrops, and ranking competitions, information asymmetry has not diminished but deepened: on-chain capital flows faster, layout rhythms are more advanced, and the chain of "research → participation → realization" is constantly moved forward. Those who can understand mechanisms, master distribution strategies, and insight into capital structures are more likely to enter when projects are still in their infancy; ordinary users, however, often only learn about them during the narrative amplification stage, placing them in a structurally disadvantaged position. It is evident that information asymmetry is not a technical issue but a game theory problem, and it will continue to widen in the future. A deeper challenge stems from the "cycle mismatch" between institutions and retail investors. Institutional funds prefer stability, security, and sustainable cash flows; retail investors favor volatility, narratives, and quick profits. Due to their different behavioral models, the market volatility structure shows "long-short fragmentation": institutions allocate to collateral-layer assets such as Bitcoin in the medium to long term, while retail investors chase assets like L2, AI, Memecoins, and emerging applications in the short to medium term. They pursue different sets of assets, different mechanisms, and different timelines. When macro liquidity fluctuates, institutions buy steadily while retail investors frequently exit amid volatility, leading to unequal returns; when narratives are booming, institutions often do not participate, causing the market to eventually return to calm. This structure puts retail investors at a disadvantage if they lack strategic capabilities.

Returning to the market situation itself, Bitcoin’s role is shifting from a "speculative asset" to a "stable collateral layer". This is not a negative signal of slowing growth, but a sign of a mature cycle: reduced volatility, deeper liquidity, and an increased proportion of institutional holdings have brought BTC closer to the position of "risk-free on-chain collateral". Its long-term goal is to become a cross-ecosystem value anchor. ETH occupies a core settlement-layer role in structural growth, but it is difficult for it to outperform high-momentum narratives; the real excess returns come from earlier-stage, lighter-structured, and faster-distribution tracks, including L2 ecosystems, AI machine economies, presales, short-cycle Memecoins, InfoFi, and NFT-Fi. The market has entered a structural bull market rather than an all-round bull market, with liquidity being released in a targeted manner and no longer generally boosting all assets. This means that in the coming year, competition will shift from "holding positions" to "track selection + rotation execution". In the future, funds will be more inclined to favor mechanism design, liquidity distribution, attention structures, and actual adoption, rather than just products, whitepapers, or imagination. Narratives create Liquidity, Liquidity brings Opportunity, and only Opportunity can be converted into Alpha. In other words, narratives are not the goal; they are channels to guide liquidity into mechanisms. What truly generates sustainable returns is the synergy of structural design, ecological accumulation, and user adoption. Therefore, risks and opportunities always coexist. Macroeconomic uncertainties will continue to test the inherent resilience of the crypto industry. Those who truly understand the structure, control liquidity, and possess execution capabilities will gain an advantage in the future rotation cycles.

# IV. Conclusion

In November 2025, the crypto market is in a structural transition. The U.S. government shutdown has led to liquidity contraction, siphoning approximately $200 billion in liquidity from the market and exacerbating funding tensions in the venture capital market, resulting in an unfavorable macro environment. On the other hand, the crypto market has shifted from "single-core driven" to "multi-faceted advancement". Structural rotation has replaced all-round prosperity, and narrative, mechanism, and distribution capabilities have become the dominant forces. Although BTC remains the underlying reserve, it no longer monopolizes the growth dividends; new tracks such as AI, L2, InfoFi, machine economies, and Memecoins bear the main volatility. The focus of the market has shifted from the assets themselves to ecosystems, scenarios, and distribution systems. Presales, AI, InfoFi, and Memecoins will become the four main engines of the future cycle. In the next three years, AI×Crypto, M2M (Machine-to-Machine) economies, and knowledge finance will jointly form the underlying logic of a new round of long-term growth. The winners of this cycle will not be determined by who obtains information the earliest or has the largest amount of capital, but by who can achieve the most effective distribution within the correct narrative. The market has shifted from "holding" to "execution" and from "sentiment-driven speculation" to "structural delivery". With the end of the U.S. government shutdown and the recovery of macro liquidity, a structural bull market may start and continue to accelerate with the synergy of innovation and capital.

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