Author: Haotian, Crypto Observer Source: X, @tmel0211
When MEME coins were revelling and mainstream coins were sluggish, I wrote a milk article saying that a big one was in the making. In the past two days, Altcoins have experienced two consecutive flash crashes, which makes people feel powerless. I can only say that this bull market is harder than expected. If we want to draw a rhythm chart for the entire bull market mainstream narrative, should Ethereum layer2 start first, then BTC layer2 take over, and finally AI+DePIN will trigger a big bull market? Next, let me say a few words:
1) Since March, the secondary market has shown signs of fatigue. After the Cancun upgrade, the market performance of Ethereum layer2 has been far below expectations. The reason is also very clear. According to a research report, by 2030, the market value of Ethereum layer2 will reach a trillion US dollars. At present, the average valuation of the token projects issued by the four kings Arbitrum, Optimism, and Starknet is only at the level of tens of billions of US dollars. Obviously, the Ethereum layer2 market is still in its early stages of development, but the fact is that many people feel that Ethereum layer2 is old and weak.
The main reason is that the development of the Ethereum layer2 market ecosystem has not been implemented as expected, and the "one-click chain launch" Stack strategy is still at the narrative level in the short term. The phased benefits of the Cancun upgrade have basically been realized, and Ethereum layer2 needs to be updated with application landing or technical breakthroughs. At present, there are potential changes in several directions: 1) General layer2 chains such as @Starknet and Arbitrum have produced phenomenal hits in the fields of full-chain games and layer3 application chains; 2) The subsequent landing of EVM equivalent ZK-Rollup layer2 such as @Scroll_ZKP and Taiko has brought vitality; 3) New layer2s such as @MetisL2 that do not follow the usual path can develop a special rhythm of development by relying on native tokens to stimulate the market after landing the decentralized Sequencer; 4) Can B-side expansion paradigms such as one-click chain issuance, modular DA, and Rollup As A Service further promote the emergence of innovative layer2s, etc.
In short, Ethereum layer2 originally had the mission of making Ethereum prosperous again. Whether the Ethereum economy oriented by layer2-centric proposed by Vitalik can be realized, these layer2 projects all have a difficult mission. The advantage is that after the EIP-4844 Cancun upgrade, the DA cost to be borne by the project party will be reduced, and the potential benefits will increase. The variable is whether the powerful layer2 attracts the increase in users (Mass Adoption), or the continuous increase in users (daily active users, user volume), further stimulating the development potential of layer2. I currently tend to the latter.
I have a hunch that Ethereum layer2 will slowly accumulate energy by relying on the application innovation and underlying technology innovation that emerge from time to time, and it can't be rushed. For example, the impact of Eigenlayer AVS on the layer2 market after its landing, or the further highlighting of ZK technology in cross-chain security and interoperability, and the diversified exploration from General-Purpose to Special-Purpose mentioned by Vitalik, etc.
2) There is no doubt that the potential of the BTC layer2 market is the result of the Ethereum layer2 market not meeting expectations. Compared with the Ethereum ecosystem, the BTC ecosystem has a stronger consensus and has new user effects such as the inscription asset issuance method. Because there are no strict standards, there will also be more diverse and innovative methods. VCs and retail investors are very active in the entire BTC layer2 market. There is reason to believe that after the BTC halving, the ecological enthusiasm of the BTC ecosystem will become the driving engine of the mid-term bull market.
However, the BTC layer2 market started out of chaos, and whether it can develop into a market with stamina in an orderly manner also has several potential variables:
1) @NervosNetwork's UTXO homogeneous binding chain ecosystem and @BSquaredNetwork's EVM-Compatible modular combination chain ecosystem, as well as the original BTC Native's Rune, Atomical, RGB, Lightning Network, etc., will be in a race;
2) The BTC interest-bearing track will replicate Ethereum Restaking and have more abundant gameplay, such as; Bouncebit, Babylon, @SolvProtocol, etc. have all given different solutions;
3) How will the asset issuance gameplay such as inscriptions be followed by a new wave of Fomo craze, and what gameplay can be combined with layer2;
BTC The layer2 ecosystem has now become a mainstream core narrative that is in urgent need of an outbreak. At first glance, it seems to be following the old path of Ethereum layer2, and it may be a bit of a reinvention of the wheel, but the strong consensus and asset issuance and new attraction capabilities of the Bitcoin ecosystem, as well as the rich possibilities for extension and development, will become the key to the continuation of this round of bull market.
After the Bitcoin halving in April, it will gradually begin to ferment and become the focus of the next market topic.
3) If you observe carefully, there are already many Alpha project markets related to AI+DePIN. The DePIN direction includes decentralized cloud computing power networks, decentralized storage networks, decentralized wireless communication networks (RPC), decentralized sensor networks, decentralized routers, and energy geospatial data networks, etc.
The AI direction covers a wider range, including distributed machine learning, decentralized computing power large model training, distributed reasoning, distributed data storage verification mining, distributed IP intellectual property rights, etc. The expandable paths and imagination space of this track are too large. The only drawback is that it requires a long time of brewing and layout, and it can't be rushed. It is not difficult for us to feel from the market growth power of @ionet that any direction has the opportunity to give birth to projects with a market value of tens of billions of dollars.
As a new track, AI+DePIN will indeed derive many innovative concepts and trends. If DeFi takes on everyone's expectations for financial decentralization, then AI+DePIN can almost bring the entire traditional web2 network, the Internet, the Internet of Things, and AI into the Web3 world. This is the core main rising wave that this round of magnificent bull market should focus on. However, neither AI nor DePIN can be a narrative that can be solved with a PPT. It takes a long time to plan and land, and it also needs growth time, which can't be rushed.
It is expected that AI+DePIN will share the market heat in the first half with the BTC layer2 ecosystem, support the heat in the middle of the bull market, and finally AI+DePIN will become the mainstream and become the absolute mainstream narrative in the Fomo period of the bull market.
Note: The above is my prediction of a bull market rhythm. Obviously, we are still in the first half of the bull market. The stories of the middle and second half of the bull market are still in the making. From the perspective of the entire bull market narrative rhythm, this initial fluctuation is really nothing.
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