"Weekly Editor's Picks" is a "functional" column of Odaily Planet Daily. Based on the extensive coverage of real-time information each week, the Planet Daily also publishes many high-quality in-depth analysis articles, but they may be hidden among the information flow and trending news, passing you by.
Therefore, our editorial team will select some quality articles worth spending time reading and saving from the content published in the past seven days every Saturday, providing you with new insights from the perspectives of data analysis, industry judgment, and opinion output, as you navigate the crypto world.
Now, let's read together:
Investment and Entrepreneurship
The most important thing to make money in a bull market is to build your own trading system
A trading system is a complete set of signal rules regarding entry, exit, stop-loss, and take-profit.
To evaluate a trading system, one only needs to focus on one core key indicator, which is the "profit-loss ratio." The profit-loss ratio refers to the average profit amount divided by the average loss amount.
A well-designed operating system should include the following seven elements: cycle judgment, operational thinking, coin selection, timing, trading rules, capital management, and risk control.
For example, the Granville Eight Method uses moving averages to analyze price trends, generally following these rules: when the average line is rising, it is a buying opportunity; when it is falling, it is a selling opportunity; when the average line turns from falling to rising, and the stock price breaks above the average line from below, it is the best buying time; when the average line turns from rising to falling, and the stock price breaks below the average line from above, it is an important selling time.
In conversation with trader Benson: How do those who trade based on data make money?
In a volatile market, Benson finds positions with a high margin of safety based on indicators; at the same time, he pays attention to BTC inflow and exchange CVD indicators to judge market trends.
Benson allocates most of his positions (over half) to quantitative strategies for coin-based appreciation, primarily holding coins; about 40% of his positions are in stablecoins, used for guerrilla trading, participating in on-chain transactions or initial contract trades.
Benson's trading strategy does not pursue explosive growth but focuses on stability. His goal is to outperform the market index, with performance this year so far around 2 to 3 times.
Different assets have different operating methods. For assets that may become market hotspots, Benson will hold until the market pays attention or the bull market ends; for larger market cap tokens, he will use technical analysis or fundamental analysis to judge possible price trends.
The dark side that is not known: Unveiling market manipulation in Web3.0
Common manipulation tactics in the Web3.0 market include wash trading, spoofing, bear raiding, creating panic (FUD), sell wall manipulation, and pump and dump.
To prevent market manipulation, it is necessary to investigate the background of tokens, choose exchanges with high transparency, and remain vigilant and cautious in analysis.
Although regulatory frameworks and technologies are continuously improving, participants in the Web3.0 space still need to stay alert.
Unlocking and crashing? How to solve the incentive misalignment problem in the crypto industry?
Web3 allows some market participants to quickly obtain high returns without the project achieving product-market fit (PMF) or demonstrating actual utility, as liquidity acquisition is much easier. Token generation events (TGE) in Web3 can occur at any time without the project reaching specific milestones. This weak correlation between success and exit in Web3 has led to significant incentive misalignment, with many market participants pursuing short-term returns without the need for long-term success. Meanwhile, the lack of transparency and regulation in the cryptocurrency space allows "predatory" behavior to not only profit but often go unpunished.
The beneficiaries of incentive misalignment are teams and founders, VCs, CEXs, market makers, and KOLs; the victims are retail investors and long-term participants.
Possible solutions to promote incentive alignment include regulatory intervention, inaction (waiting for the market to self-correct), encouraging self-discipline (transparency and accountability), improving token allocation design (avoiding low circulation at TGE, breaking away from fixed token supply models, designing convex profit distribution for insiders, and introducing goal-based unlocking mechanisms).
For the industry, immediate measures to address incentive misalignment include: acknowledging the problem, promoting transparency, holding bad actors accountable, and calling for innovative token allocation designs.
Airdrop Opportunities and Interaction Guides
New round of PTR testing launched, the last chance for the popular chain game Seraph?
A comprehensive look at major financing projects and early participation opportunities in Q4 2024
Must participate this week: Pump.fun trading, Morph mainnet new tasks, Space and Time galaxy tasks
Interaction guide: "Global Blind Computer" Nillion raises $25 million again
Q4 Airdrop Guide: 76 projects for early interaction
Meme
The hottest Meme concepts: AI, artists, zoos, and my world
Meme Cultivation Manual: Rebirth, I Want to Be a Diamond Hand (3) | Produced by Nanzhi
The profile of the trading target should be:
Low drawdown ranked first—identify the investment ratio in the worst-case loss scenario, and cash out after a series of losses;
Can make money—besides total profit and loss, also calculate the details of the investment cost, avoiding addresses that rely on high-risk FOMO during losses;
Not relying on high-risk bets, but also reflecting the ability to enter at the bottom—calculate the proportion of low-entry in profitable trades;
Low trading frequency—fewer buying instances;
Holding for a long time—can also be included in the statistics of point 4, not cutting losses is also a plus.
Also recommended: 《Increase PVP win rate, keep this advanced guide to Memecoin tools》《Is the Meme sector starting to play with art? A grand review from the banana concept perspective》。
Ethereum
Revisiting the development and challenges of ETH: What exactly caused ETH to lose its vitality?
The author believes that the long-term trend of ETH is not problematic, as there are no direct competitors in the market. In the narrative of Ethereum, the key aspect of "decentralized execution environment" is more about "decentralization" rather than "execution environment," and this fundamental base has not changed.
The core reasons for the current bottleneck in ETH's development are twofold: first, the Restaking track has caused a vampire attack on the mainstream technology development path of Layer 2, diverting a large amount of ETH ecosystem resources. The core mechanism of Restaking does not create incremental demand for ETH, directly leading to the application side being unable to obtain sufficient development resources and user attention, causing promotion and user education to stagnate; second, key opinion leaders in the Ethereum ecosystem are becoming aristocratic, forming a class of interests, which has led to a solidification of class mobility, and the developer ecosystem lacks sufficient incentives, making innovation appear weak.
On-chain data interpretation: Why is ETH underperforming, and when will it rebound?
To determine whether ETH is attracting capital attention, there are two measurement standards: the flow ratio of ETH on exchanges and the overall on-chain activity. Using BTC as a reference, by observing the flow ratio of ETH relative to BTC, one can clearly see changes in capital preferences.
From a historical perspective, the conclusion is drawn: if Ethereum continues to maintain the status quo (both internally and externally), even with the support of ETFs, it will be difficult to achieve a flow ratio on exchanges exceeding 50% or more compared to BTC. This is because the market has already gone through a round of FOMO after the wave in March this year.
To determine when to enter ETH, focus on:
The flow ratio of ETH on exchanges to BTC reaches 50% or more (currently at 35%);
Perhaps by the time it reaches 50%, ETH's price will have already risen, but it will certainly not be at its highest. For me, I need to confirm the trend before executing the strategy;
The number of active addresses on-chain reflects the prosperity of the ETH ecosystem to some extent, and it should show a continuously upward trend;
The number of transactions and transaction amounts should increase in sync, especially the transaction amount, which is an important basis for measuring whether large funds are participating.
A new perspective on digital goods: Will ETH's value rebound?
This article explores the differences between digital goods (such as L1 tokens) and quasi-equity tokens, proposing a new framework for evaluating digital assets, particularly regarding the value of ETH. The author argues that ETH should be viewed as a sovereign commodity rather than a quasi-equity token, as commodities do not generate cash flow or dividends. It also discusses how to eliminate the ambiguous definition of ETH assets, reaffirms the importance of commodity premiums, and points out potential future valuation errors.
In the next part of this series, the author will explain how and why certain technical steps, such as determining gas tokens, sovereign supply, and consensus, are necessary conditions for establishing a social contract for commodity premiums.
Multi-Ecosystem
In-depth exploration of liquidity pool quality: Has Solana really surpassed EVM chains?
This study delves into the quality of liquidity pools on top blockchains, assessing whether Solana has surpassed all EVM chains in trading volume, referencing three criteria: established trading history, high liquidity, and sustained trading volume.
Without considering TVL, Solana has a significant trading volume among the top 150 pools, but it has not come close to surpassing all EVM chains, nor has it surpassed Ethereum (though it is very close). Most of Solana's trading volume comes from pools with lower liquidity, a considerable portion of which comes from Pump Fun. Ethereum remains the dominant player in DeFi, but Base is unexpectedly becoming a strong challenger due to having the highest trading volume pools.
CeFi & DeFi
BitMEX Research: Unveiling MicroStrategy's bond structure, when will it be liquidated?
MicroStrategy's debt scale is $4.25 billion, calculated based on its borrowed principal. Meanwhile, the company's stock currently has a market capitalization of $43 billion, and its Bitcoin holdings are valued at $17 billion. This indicates that bonds do not constitute a significant portion of MicroStrategy's capital structure.
However, if Bitcoin's price were to drop significantly, for example, to around $15,000, and MicroStrategy could not further leverage, analysts might need to consider the "forced liquidation" of Bitcoin. Nevertheless, this potential forced liquidation timeframe will focus on the maturity dates and option expiration dates mentioned in this article, which are spread between 2027 and 2031, and the timing is very clear. Therefore, even if Bitcoin does drop to around $15,000, the likelihood of MicroStrategy being forced to sell Bitcoin to repay bonds remains low.
Behind the meme craze, Perp DEX has become a beneficiary of on-chain liquidity aggregation
Since the end of last year and the beginning of this year, Perp DEX protocols such as Hyperliquid, Drift, Surf, and Orderly have emerged, and the established leader dYdX has also become active again. With the rapid rise of the meme sector, the power of on-chain liquidity has further opened up new opportunities for the Perp DEX market.
Hyperliquid has already shown a strong wealth creation effect, but the discussion remains focused within the English-speaking community. According to Hyperliquid's spot trading rankings, it can be seen that under the premise of catching up to CEX trading experiences, token price increases of over 100% already provide an experience comparable to CEX. Instead of trading contracts on CEX, it is better to trade spot on DEX.
Weekly Hotspot Recap
In the past week, on October 30, BTC rose to 73,650 USDT before retreating, just 130 USDT short of its historical high (Institutional Market Outlook), and on November 1, it briefly fell below $69,000; CZ made his first appearance after being released: focusing on education in the future, and will not be involved in issuing new tokens in the short term; Canary Capital submitted a SOL ETF application to the SEC;
Additionally, in terms of policy and macro markets, the Washington Post will not endorse a presidential candidate for the first time since the 1980s; Morgan Stanley: The U.S. presidential election may trigger serious market volatility, advising investors to focus on long-term strategies; Trump posted to rally votes celebrating the 16th anniversary of the Bitcoin white paper; Trump-related stocks surged; Immutable received a Wells notice from the SEC, accused of violating securities laws; Russia released new crypto regulations, expanding the scope of regulation on mining and related infrastructure; Russia lifted the ban on Bitcoin mining, which may encourage other countries to mine Bitcoin; the Hong Kong Stock Exchange will launch a virtual asset index series; the Hong Kong Securities and Futures Commission is expected to issue the first batch of formal licenses to applicants for virtual asset trading platforms by the end of the year;
In terms of opinions and voices, Coinbase CEO: The next SEC chair should withdraw all meaningless cases and apologize to the American people; Willy Woo: Altcoins are a game for insiders, the current cycle is dominated by meme coins; Arthur Hayes: Go Bitcoin, massive liquidity is on the way; Matrixport: Bitcoin demand surged due to the increased probability of Trump's victory and ETF purchases; HashKey Livio: Hong Kong's Web3 enters the second phase, from single points to a full ecosystem; Vitalik published an article discussing the future development of the Ethereum protocol, The Purge, with goals including reducing storage requirements and the complexity of the Ethereum protocol;
In terms of institutions, large companies, and leading projects, Microsoft major shareholder BlackRock and Vanguard will vote on the proposal of "whether to research buying BTC"; Trump family's crypto project WLFI plans to launch a stablecoin, with the team developing key project components; OKX announced Standard Chartered Bank as a third-party custodial partner; Magic Eden opened testME airdrop claims; Grass airdrop claims are open; the first official NFT series of CAT721 has begun minting;
In terms of data, Deribit CEO: The number of Bitcoin call options expiring on November 8 is twice that of put options; on October 30, TradingView data showed that BTC's market share surpassed 60%; Tether's Q3 financial report: net profit of $2.5 billion, U.S. Treasury holdings of $105 billion, stablecoin circulation of $120 billion;
In terms of security, the founder of Ordinals: version ord 0.21.2 has fixed a bug that could lead to rune loss, recommending an upgrade as soon as possible; Truth Terminal founder X was hacked in a series of dramatic events; … well, it has been another eventful week.
Attached is the portal for the "Weekly Editor's Picks" series.
See you next time~
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