fundamentals

After a decline earlier on Monday, Bitcoin, Ethereum, and other cryptocurrencies like Solana have seen a mild rebound. Interestingly, Goldman Sachs pointed out that despite the weak price performance, on-chain activity paints a different picture, particularly for the Ethereum and Solana networks:The Ethereum network's daily active addresses, new addresses, and transaction counts increased by +27.5%, +26.8%, and +36% respectively month-over-month.The Solana network's daily active addresses and transaction counts increased by +24.3% and +8.2% respectively month-over-month. The number of new addresses on Ethereum reached an all-time high, averaging 427,000 new addresses daily in January—compared to an average of 162,000 new addresses per day during the "DeFi summer" of 2020. Currently, Ethereum has 1.2 million active addresses daily—this is another all-time high based on the 7-day moving average.Goldman Sachs also specifically noted that Ethereum's current market capitalization is now below its realized market capitalization (the total value calculated based on the price at which each token last moved on-chain, representing the total cost basis), which means that most ETH holders are currently in a loss position. Timothy Misir, head of research at digital asset analytics firm BRN, stated, "For cryptocurrencies, the stability of ETF fund flows is a key signal to monitor. Without this support, a rebound is likely to be difficult to sustain."

Delphi Digital stated in its latest report on Lighter (LIT) that the fundamentals of Lighter are much better than what the price trends reflect. The real issues are not poor product quality or insufficient team strength, but rather the lack of transparency in its token economic model, financial situation, and market maker collaborations.If Lighter can fully disclose the flow of profits, clarify the decision-making mechanisms for buybacks and development investments, and clearly present the incentive structure, then LIT could very well become a hassle-free asset and investment target like HYPE.

BitMine Chairman Tom Lee stated, "The parabolic and sustained rise of gold and silver is overshadowing the ongoing strengthening of the intrinsic fundamentals of crypto assets, especially Ethereum and Bitcoin.At the 2026 Davos Forum, financial institutions are preparing to build products on Ethereum and other smart blockchains. When the fundamentals continue to trend upwards, it is only a matter of time before prices rise."

According to Cointelegraph, Phong Le, CEO of Strategy, stated that despite the decline in Bitcoin prices at the end of the year and the low market sentiment, the market fundamentals for Bitcoin in 2025 remain strong.Le emphasized that the market fundamentals for Bitcoin this year are better than ever, and he does not overly focus on short-term performance. Le pointed out that the U.S. government and banking system are fully supporting Bitcoin, which is "extremely optimistic" for 2025 and 2026. He revealed that he and Strategy's Executive Chairman Michael Saylor are meeting with traditional banks in the U.S. and the UAE, which are trying to understand how to keep up with the development of cryptocurrencies. Although the U.S. President signed an executive order in March to establish a strategic Bitcoin reserve, a formal strategic plan has yet to be determined.

Matrixport released a chart today stating, "From a pricing logic perspective, the main driver of cryptocurrency prices remains the inflow of incremental funds, rather than changes in user numbers or application scenarios themselves. This is particularly evident in the Ethereum ETF: during a continuous inflow of nearly $10 billion, the ETH price rose from about $2,600 to $4,500; however, when the inflow slowed down, the price quickly retraced its previous gains. In an environment where new real demand is relatively limited, both Ethereum and the broader cryptocurrency market remain highly sensitive to marginal changes in fund flows.In contrast to the last bull market, where the narrative was more centered around "adoption, revenue, and network growth," and funds were willing to pay a premium for these expectations; in this cycle, price performance is largely dependent on where the funds flow, how quickly they enter the market, and when the funds suddenly stop."

K33 Research released the 2025 Annual Report on the Cryptocurrency Market, indicating that despite Bitcoin's fundamentals reaching an all-time high, its price performance lags behind other major asset classes.The report shows that the U.S. government has established a strategic Bitcoin reserve, while national pension funds in Abu Dhabi and Luxembourg allocate 1-3% of their funds to invest in Bitcoin. Harvard University has also made similar allocations in its substantial endowment fund. Meanwhile, since January 2024, over 20% of Bitcoin UTXOs that are more than two years old have been activated, indicating a large-scale sell-off by early holders. Analysts believe this is both a natural behavior of profit-taking and a reflection of the response to Bitcoin's gradual integration into the traditional financial system. Despite market adjustments, the report holds a "constructively bullish" view for 2026, suggesting that the current price divergence from fundamentals creates investment opportunities, especially in the context of a new U.S. government potentially adopting a more accommodative monetary policy.

According to market news, CryptoQuant analyst MorenoDV_ stated that a valuation reset for Bitcoin is occurring.By observing the Bitcoin NVT golden cross indicator (smoothed with a 100-day moving average), the relationship between market valuation and on-chain economic activity can be assessed. NVT is considered the price-to-earnings ratio for Bitcoin, where transaction volume replaces earnings to answer the question of whether the network's market value aligns with actual economic activity. The current NVT golden cross indicator shows that short-term NVT is significantly below the long-term trend, indicating that Bitcoin's market value is undervalued relative to on-chain activity.Historically, when the indicator shows a deep negative divergence, it typically reflects low market sentiment and structural undervaluation of the network. In this cycle, the indicator fell to a historical low of -0.58 and has now rebounded to about -0.32, indicating that prices are gradually realigning with the transaction-driven fundamentals, but still remain in a conservative valuation range. This phenomenon usually occurs during deleveraging and risk-averse phases, followed by a market accumulation period that drives healthier price discovery. The current market is transitioning from deep undervaluation to equilibrium, with selective capital strengthening, which may signal structural improvements and long-term opportunities in the crypto market.

Liquid Capital (formerly LD Capital) founder Yi Lihua posted on platform X, stating that the fundamentals of ETH are firmly optimistic. However, since the major crash on October 11, market liquidity has significantly decreased, with the derivatives market dominating rather than the spot market. The current fluctuations are within a normal range, especially in light of the four-year cycle resonance and the upcoming Christmas season. However, for spot investments, it may not be possible to buy at the lowest price, but it is still the most suitable investment price range.From a medium to long-term investment perspective, especially in the new era of on-chain finance, ETH is the core investment asset, with WLFI and others as core allocation investments. Our investment and data logic have not changed from previous research reports.

According to The Block, analysts from research brokerage Bernstein pointed out that the industry "is still waiting for a clear signal that Bitcoin has bottomed," but emphasized that this round of decline is fundamentally different from previous corrections—core crypto operating companies are actively transitioning to new revenue models, and the business fundamentals are "performing strongly."In a report to clients on Monday, analyst Gautam Chhugani's team acknowledged that the weak sentiment has affected crypto-related stocks: Coinbase is down 21% over the past 30 days, Circle is down 37%, and Robinhood is down 12%. However, they noted that most speculative bubbles only exist in the tail-end projects of trend-following strategies and reiterated that "no realistic scenario threatens the long-term viability of the strategy."Bernstein emphasized that the operational performance of the industry stands in stark contrast to market prices, with innovations in business models and favorable regulations reflecting deep resilience. Analysts believe the industry is entering a new phase, with companies beginning to implement strategies previously constrained by regulatory uncertainty, expanding into areas beyond cyclical trading revenue.

Liquid Capital founder Yi Lihua posted on platform X: "WLFI has risen by 50 points in the last three days. For a large project, this kind of counter-trend growth should indicate significant progress in the fundamentals. In today's environment where the narrative tide in the crypto space has receded, all projects must study fundamentals, user base, profit models, team background, and long-term ceiling prospects for medium to long-term investment."

Liquid Capital founder JackYi tweeted, "WLFI has risen by 50 points in the last three days. For a large project, this kind of counter-trend growth should indicate significant improvements in the fundamentals. In today's market, as the narrative tide recedes, all projects require long-term investment research on fundamentals, user base, profit models, team background, and ceiling prospects."

The CEO of the South Korean crypto venture capital firm Hashed, Simon Kim, stated in a post that since entering the crypto space in 2015, he has experienced multiple market fluctuations, and this bear market is the first that has not truly frightened him. Although watching his investment portfolio still stings due to the bear market, this bear market is fundamentally different from previous ones. In past bear markets, there was a pervasive fear of the survival of crypto technology and the market potentially disappearing entirely, such as threats from governments jointly banning crypto assets or new global ledger technologies replacing blockchain. However, currently, regardless of daily price fluctuations, such fundamental concerns have not emerged. Global regulation is gradually evolving, aiming to promote development in conjunction with the industry rather than suppress it; more institutional investors are beginning to recognize the value of this asset class, as evidenced by the significant position of IBIT in Harvard University's endowment fund, which is highly symbolic; stablecoin metrics are hitting new highs every month, and it is expected that by 2030, its issuance will grow several times from current levels.Simon Kim also mentioned that billions of people worldwide will access digital assets through everyday fintech applications and large tech applications in the future, rather than relying on exchanges. Everything is being tokenized, and the prosperity of the on-chain ecosystem has become a foregone conclusion. He emphasized that cycles are temporary, and the fundamentals are irreversibly moving forward, urging everyone to remain patient, as price rebounds to catch up with these fundamentals will not take long.

According to Jinshi reports, Citic Securities research report states that by the third quarter of 2025, the performance of U.S. stocks is expected to continue to grow, with the information technology sector's profit growth leading again. Although there is a divergence in profit performance between technology and non-technology sectors, most industries still maintain a high profit growth rate. For the whole year, U.S. stock profit expectations have undergone a structural upward revision, with tech giants remaining the core driving force. Currently, the market has doubts about the sustainability of cyclical investments in technology companies, raising concerns about the potential bubble in the U.S. AI sector.

According to Jin Ten, the US stock market has continued to be under pressure this week, with investors questioning the sustainability of high valuations in technology stocks. Pepperstone research strategist Ahmad Assiri stated that this pullback is not a structural collapse, but rather a reality check. He pointed out that the approximately 2% decline in the Nasdaq reflects more of a market valuation response rather than a deterioration in fundamentals, and the VIX index has not shown a significant spike, further supporting this view.

Liquid Capital (formerly LD Capital) founder Yi Lihua posted on platform X that the U.S. government is about to open, the fundamentals of ETH are sound, and when others are in panic, one needs to be greedy; gradually buying the dip is the best strategy.

Liquid Capital (formerly LD Capital) founder Yi Lihua stated that at the current stage, one should continue to gradually buy in, "there are huge opportunities before the U.S. government reopens."He believes there is no need to worry about the ETH spot trend, as its fundamentals remain robust, the total scale of stablecoins continues to expand, and the short-term risks in the U.S. stock market are limited. Yi Lihua pointed out that although market sentiment is still under pressure, the liquidity and macro environment are gradually improving, and he maintains an optimistic outlook for market performance in late November and beyond.

LMAX strategy analyst Joel Kruger stated that Bitcoin fell by 4.5% in October, ending a six-year streak of October gains, but this decline may only be temporary and not a reversal of the trend.The fundamentals remain strong, and historically, the fourth quarter is usually the best-performing quarter for Bitcoin.