Interview with Chinese-speaking KOL: What are the trends for the second half of 2023, and which sectors are worth watching?
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Interview with Chinese-speaking KOL: What are the trends for the second half of 2023, and which sectors are worth watching?
What would you do if you had $1,000 and $100,000 respectively?
Navigating Web3 tides with focused insightsA stagnant bear market combined with strong global regulation—do these dedicated crypto innovators, the "Degens," have investment insights and trend perspectives you don't know about?
What are your thoughts on the cryptocurrency trends for the second half of 2023?
Coinversation
Xiaona: Personally, I think the second half of 2023 will be relatively mediocre. The probability of a major bull run or another deep downturn isn't high. Compared to 2022, the likelihood of another event comparable to FTX or Luna is extremely low.
Bee: I believe the market in the second half of 2023 will trend downward. Pressing issues like the debt ceiling and banking crises, coupled with the increasing correlation between crypto and stock markets, as well as the lack of strong narratives or catalysts, make me skeptical about a recovery into a bull market this year. While I really hope it happens, I don’t expect a clear bullish turn in the second half of 2023.
Lao Bai
From a downside perspective, the current market lacks the foundation for major blow-up events like Luna, 3AC, or FTX seen in 2022. Interest rate hikes are also nearing their end, making it difficult for prices to break below last year’s lows—neither the crypto ecosystem nor macroeconomic conditions support a “deep bear” scenario.
From an upside perspective, there's currently no groundbreaking innovation like new public chains or DeFi during previous cycles. The only significant event worth watching in the second half of the year is Ethereum's Cancun upgrade. However, new tokens such as Aptos, OP, Arb, and Sui launched with FDVs reaching tens or even hundreds of billions, overwhelming a market already suffering from liquidity shortages. Although rate hikes may pause, interest rates are likely to remain high, with little chance of rate cuts or monetary easing before year-end. Therefore, neither internal developments nor macro conditions support a major bull run. With neither a deep bear nor a strong bull likely, the market can only oscillate within a range.
Alvin
I still haven’t seen any signals indicating a bull market return this year. My approach remains relatively conservative. In Q3 and Q4, we can start paying attention to the potential Layer 2 wave driven by the Cancun upgrade. Still, the worst may already be behind us, and now it's about holding steady until next year’s Bitcoin halving.
2lambro
Personally, I'm bearish. The key reason is that there aren't any major events expected soon, either in the broader economy or within the crypto space. What big event are we currently anticipating? Previously, it might have been the Ethereum merge; what is it now—China’s narrative… or regulation? I’m glad I caught the rhythm when the market rebounded, but honestly, I don’t see any compelling new narrative emerging. I hope I’m wrong.
Little Raccoon
I don’t know. Making mid-to-long-term trend predictions isn’t my strength.
Which blockchain sector are you currently watching closely?
Coinversation
Xiaona: I mainly focus on DeFi, especially the derivatives market.
Compared to traditional finance, this sector in DeFi is still in its early stages, offering ample room for growth. While many consider DeFi non-mainstream, I find it particularly interesting and believe it serves as the foundational layer for other sectors within the blockchain industry.
Bee: My primary area of interest has always been DeFi. Currently, I’m closely monitoring derivative trading protocols, including volatility products, perpetual contracts, options, and interest rate swaps. Three projects I’m watching closely are GammaSwap (full disclosure: I’m part of the team, so I naturally have some bias—I don’t mind readers knowing), Dopex, and Pendle Finance.
Lao Bai
The main sectors I’m currently tracking are the following three:
Public Blockchains – Public blockchains remain a perennial topic and the most critical infrastructure in blockchain, so they must be monitored continuously. Within this space, I’m primarily focused on modularization technologies—for example, the recently popular RAAS (Rollup as a Service)—and projects that can genuinely push the performance ceiling of EVM, such as the “mysterious” project ABCDE plans to lead invest in, which I previously mentioned on Twitter.
GameFi – At present, DeFi innovation appears to be hitting a relative bottleneck, with no clear path toward mainstream adoption. Thus, GameFi may still represent the best avenue for breakout success. After the Play-to-Earn bubble burst, the GameFi space has seen numerous new experiments—Play & Earn, Play-to-Own, Bet/Risk/Skill-to-Earn, Fully Onchain Games (Autonomous Worlds)—demonstrating vitality beyond both DeFi and NFTs. The sector has also attracted massive funding, and there’s strong potential for breakout applications within the next 1–2 years.
AI – With the rise of ChatGPT, AI has become the hottest topic across tech and finance, even driving up U.S. equities. This wave of AI is not just hype—it represents fundamental technology capable of transforming human life and applications. People often say AI stands for productivity, while blockchain stands for production relationships. How to integrate AI with blockchain could become critically important in the next bull cycle and may even serve as its primary engine. Looking back at the past two bull markets, each was accompanied by new technological innovations and asset classes: ETH and ICO in 2017, new L1s, DeFi, and NFTs in 2021. For 2025, the most promising candidates appear to be Game and AI. In the early-stage market, we’re already seeing more and more projects exploring this convergence. Personally, I believe AI could combine powerfully with NFTs, opening entirely new utility and empowerment scenarios beyond PFPs.
Alvin
Currently, the sector I’m most interested in is LSDFi protocols. I believe this is one of the few themes that can sustain momentum into the next bull market. With Ethereum gradually becoming deflationary and on-chain staking rates rising, the groundwork is being laid. Both new protocols and blue-chip DeFi platforms like Curve and Frax are joining the space. LSD will undoubtedly have a place in the next bull run, so it’s worth starting to pay attention now.
2lambro
I’ve been closely watching the Ethereum Layer 2 ecosystem. I once thought there would be rotation among Layer 2s, similar to earlier eras dominated by SOL, AVAX, or BSC, but lately, progress has stalled.
Earlier this year, I spent considerable time researching the yield market—projects like Pendle and various smaller ones (I’d rather not promote specific names). Some of these DeFi protocols offer sustainable yields derived from GLP+LSD returns. However, I believe current prices already reflect this value unless overall market yields rise due to a broader recovery. I believe most retail investors still don’t fully grasp the power of the yield market. Perpetual Protocol remains a protocol I follow closely—the real yield market is still in its infancy.
Little Raccoon
Wallets and Perp DEXs. Wallets are traffic gateways. Metamask has repeatedly hinted at token issuance, and as competitors continue gaining market share, they’ll likely accelerate UX improvements. A competitive race creates opportunities. This sector has high ceilings, solid data for analysis, and unlike DEXs where insights can easily be extracted via Dune, inefficiencies persist here, leading to frequent mispricings. Key areas I’m watching include CEX wallets (OKX, Coinbase), mobile wallets (Trust Wallet, Uniswap), and multi-chain wallets (Frame, Rabby). I’m less focused on Account Abstraction wallets, Social Recovery, or zk wallets because valuations are high, they’re still in the vision stage without meaningful data, and established wallet brands can pivot into these areas too—making outcomes highly uncertain.
How do you manage your investment portfolio? What’s your logic for adding or reducing positions?
Coinversation
Xiaona: I’m terrible at this—better not mislead anyone.
Bee: I’m a long-term holder of ETH, so my main goal is to accumulate as much ETH as possible. All my speculative investments in altcoins ultimately aim to convert into ETH to maximize returns.
If I don’t believe an altcoin will outperform ETH in growth, I won’t invest in it. That said, I generally avoid frequent speculation because I think crypto markets are heavily influenced by shifting narratives, so I don’t constantly analyze every move.
Currently, 90% of my crypto portfolio is in ETH, with some stablecoins held to take advantage of market dips.
Lao Bai
As mentioned above, I’m not skilled in secondary market analysis, so my portfolio management and position-sizing logic are amateurish and simple: buy assets in sectors I like when I feel they’re near lows, then HODL; sell or cut losses when prices reach satisfying levels or when confidence is lost. During DeFi Summer, I frequently participated in liquidity mining across chains, but as the DeFi sector cooled, I stopped. One thing worth noting is that I never touch leverage or futures—only spot trading.
Alvin
Since the bear market began, I’ve mostly used dollar-cost averaging—probably allocating at least half my capital this way. A bear market is a phase to accumulate chips diligently. Avoid overly aggressive moves that erode principal. Also, actively seek teams with a real chance of succeeding in the next bull market—this is when you can effectively identify who has real substance. I allocate 5–10% of my assets to chase market trends, staying open to new things and willing to go all-in when opportunities arise.
2lambro
My logic is simple: don’t go all-in, so you won’t get completely trapped. There are countless opportunities in crypto—wait for your moment, keep learning, discover your edge, and don’t just gamble in the market, because everyone is impatient.
Little Raccoon
Diversification is key—across asset classes, storage locations, and risk profiles. This way, you’re not afraid of single-point failures, maintain healthy psychology, and handle high-, mid-, and low-risk allocations more comfortably. All yield must be personally risk-adjusted. If appropriate, even high-risk plays can receive modest allocations. Don’t impose rigid rules on yourself. Higher yield usually means higher risk, but lower yield doesn’t necessarily mean lower risk. Many overlook smart contract risk and centralization risk—not saying you should avoid them, but you must factor them in whether depositing into AAVE, Binance, GMX, local mining pools, or even banks.
If you had $1,000 and $100,000 respectively, how would you deploy them?
Coinversation
Bee: The $100,000 case is easier to answer—simply buy ETH, as it’s the asset I have the most confidence in. With $1,000, I’d invest in a project with a strong team and a fresh narrative, such as GMX’s upcoming V2 upgrade, as a short-term speculative play.
Xiaona: Like Bee, I’d allocate 90% of my assets to major cryptocurrencies like BTC and ETH—especially ETH—and use the remaining 10% for speculation.
Lao Bai
$1,000 – I’d look for low-market-cap small-cap coins tied to current trends, like PEPE—double my principal and let profits ride, moving quickly from one trend to the next to rapidly grow capital.
$100,000 – Half allocated to BTC and ETH, the other half to quality altcoins that are either fundamentally strong and oversold or poised for external/internal catalysts.
Alvin
$100,000: Hold ETH firmly, find several long-term liquidity mining opportunities that can last into the next bull market, and allocate to a few blue-chip NFTs expected to steadily grow through the cycle—avoid frequent trading.
$1,000: Definitely go after airdrops. Also, closely monitor developments across various L1s and try building a personal L1 ETF or DeFi ETF—this kind of diversified, long-term approach yields better returns.
2lambro
If I only had $1,000, I wouldn’t bother buying any coin. Instead, I’d invest in myself—aiming for a higher salary and minimizing living expenses.
Little Raccoon
With only $1,000, I’d suggest not investing at all—gas fees alone would burn through it. I’d rather spend it on seafood with fiat. With $100,000, I’d use part of it to trade low-tier NFTs—small volume but profitable if done diligently—and keep the rest in wallets, CEXs, or banks, allocating based on personal comfort.
How do you stay informed?
Coinversation
Xiaona: Twitter and Discord are the best sources for crypto information, though you need to filter carefully—they can be chaotic. Let me recommend our Telegram group “Chatting East and West,” which gathers a group of top-tier crypto players who share highly valuable and timely insights daily—I’ve benefited greatly from it myself.
Bee: I use Twitter to stay updated on the latest crypto developments. For macroeconomic analysis, I enjoy reading content from Arthur Hayes, founder of BitMEX.
Lao Bai
Three channels: First, self-research—mainly via Chainfeeds and Twitter. Second, discussions with peers in the industry. Third, conversations with founders in the early-stage market.
Alvin
Primary sources are Discord servers. For narrative sentiment, I follow various KOLs on Twitter, using a structured classification framework to build market sensitivity and detect shifts in emotional tone. I regularly use tools like Alphascan, Defillama, and Arkham to help uncover alpha early.
2lambro
I faithfully follow Alvin0617.
Little Raccoon
I watch Twitter and Discord—not for the information itself, but for how it’s presented, who presents it, and their motivations.
What are your thoughts on increasing regulatory pressure in the U.S. versus gradual openness in Asia?
Coinversation
Bee: If U.S. regulators don’t ease up, I believe other countries will gradually take the lead in crypto and blockchain technology. I think Asia is already preparing for the next crypto boom.
Lao Bai
I see two reasons. Short-term: the FTX collapse gave the U.S. sufficient grounds for concern—classic Wall Street-style “misuse of customer funds and excessive speculation during bull markets.” There’s fear that risks from blockchain firms could spill into traditional finance via gateways like Silvergate, hence the push for stricter regulation to prevent recurrence.
In contrast, regions like Hong Kong were less affected by events like FTX, so concerns are minimal. Long-term: the entire crypto industry, valued in trillions, is still only about half the size of Apple. For a superpower like the U.S., demand for such financial innovation isn’t urgent—especially given AI’s stronger momentum and opportunities right now.
Singapore, as a small nation with limited resources, relies on finance, tech, and logistics—so it naturally embraces emerging technologies with greater openness. Hong Kong, once Asia’s financial hub, has recently faced challenges from Singapore and Shanghai. It sees blockchain and Web3 as potential “comeback cards” and thus wants to seize the initiative early.
Alvin
I feel conflicted—happy that Asia’s blockchain sector is advancing due to U.S. regulation, yet aware that the broader market likely needs clarity from the U.S. side to truly recover and enter the next bull cycle. It’s fascinating to see Asian countries forging their own paths throughout 2023.
2lambro
No comment—that’s not my expertise. I only track capital flows and hope decentralized systems earn a place in future capital markets.
Little Raccoon
Investing on both sides is the best approach—don’t have strong biases or illusions toward China/Taiwan/Hong Kong/Southeast Asia. Valuations for comparable-quality projects in Asia are currently around one-third of U.S. counterparts—previously one-fifth. There’s reason for the discount, but if it’s cheap enough, you still buy.
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