MVC Market Watch: The Second Half of the Overall Rest in the U.S. Dollar Market

Cryptocurrency Market Secondary Fund MVC February Market Overview and Commentary

1/ As the Chinese Lunar New Year approaches, we wish all our readers good health and success in the new year.

2/ From the market perspective, although positions were cleared last year, the cryptocurrency market that has lost its heartbeat still causes concern. As of now, there are no signs of an end to this deep correction. The large-scale deleveraging at the end of January was only a phase where demand was created through high volatility, and the clearing of old crypto positions has further accelerated.

3/ Looking ahead, we are not optimistic about short-term crypto assets. However, overall, we tend to view this correction as a consolidation phase since the end of 2024. For Bitcoin, which has led dollar assets for two consecutive years, this adjustment has not changed the upward trend since 2022. From the international market perspective, we are optimistic about the performance of non-ferrous related industries and some AI-disruptive companies benefiting from the capital markets throughout the year.

Market Overall Trends and Review of Market Movements

The market has been lackluster. We observe Bitcoin’s further decline and increased market turnover, but there are also some optimistic signals:

① Despite the massive trading volume, outflows are manageable, and the foundation of crypto ETFs remains intact;

② MSTR faces no significant liquidation or financing pressure;

③ On-exchange liquidation data remains moderate compared to 1011;

However, the market has not provided positive reasons. We still see high valuations in the US stock market, ongoing crypto outflows, and the persistent crisis of domestic liquidity in the US dollar. Gold and silver show no signs of ending their correction. Therefore, the short- to medium-term outlook for crypto remains uncertain, which is why we did not provide a dedicated crypto market observation in January.

Nevertheless, we lean toward viewing the trend since November 2024 as Bitcoin consolidating after reaching a new high amid distortions in US dollar liquidity. For a major asset class, this trend suggests the potential for a turbulent future. Using a fortune-telling analogy, we optimistically speculate that crypto consolidation will enter a new allocation cycle in Q3-Q4 of this year. The subsequent market level will not be lower than this round of silver.

Additionally, regarding the global asset trends for 2026, we are particularly optimistic about:

① The non-ferrous metals sector represented by Latin American and RMB resource stocks;

② Beneficiary targets within the AI-disruptive industries, especially China-US.

Starting from 2026 and the Year of the Horse, our sense of global disparity deepens compared to 2025 and 2024. The world’s production order is rapidly iterating, and the silent majority may face the frustration of seeing decades of effort taken away overnight by seedance. This cycle of capital markets may be the best opportunity for many who cannot become AI sensors themselves. The once-in-15-year opportunity in non-ferrous metals will also begin in 2026. Let’s work together and encourage each other.

Once again, we wish everyone smooth sailing and all the best.