Bitcoin ecosystem sector heats up again—will there be further market momentum?
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Bitcoin ecosystem sector heats up again—will there be further market momentum?
Perhaps it is more like a "correction-driven rebound" triggered by extremely low valuations and extremely weak expectations.
Navigating Web3 tides with focused insightsAuthor: ChandlerZ, Foresight News
Last year at this time, the Bitcoin ecosystem was at the peak of its narrative momentum. From the BRC-20 inscription craze to rapid market cap expansion of assets like ORDI, and multiple projects such as SATS and RATS surging several-fold within a short period, Bitcoin's on-chain transaction volume, gas fees, and miner revenues surged dramatically—propelling the Bitcoin ecosystem to an unprecedented high.
But the hype was short-lived. Over the past year, the Bitcoin ecosystem has almost become a "reverse indicator" for sector rotation. In terms of price declines, major representative projects like ORDI and SATS saw drawdowns exceeding 95% from their peaks. On-chain activity-wise, inscription transaction volumes have continuously shrunk, and the interval between new project launches has significantly lengthened. From a community sentiment perspective, multiple disappointing token airdrops and the rapid decline in热度 after the Runes ecosystem launch have led to increasingly cautious or even indifferent overall sentiment.
Over the past week, the Bitcoin ecosystem sector has shown significant signs of rebound. Top-tier asset ORDI surged nearly 97% within six days, while PUPS rose 127.04%, making it one of the strongest performers in this rally. SATS climbed 87.57%, nearly doubling from its yearly low. ORDI and NALS increased by 86.22% and 90.77% respectively, with other assets such as BANK, BB (BounceBit), and BSSB recording weekly gains of 40–80%. Mainstream BRC-20 and Runes assets are experiencing broad recovery. Meanwhile, on-chain capital inflows have noticeably increased.
The “Unbearable” State of the Ecosystem
Beneath this sharp upward move, reviewing the medium-to-long-term trend of the entire Bitcoin ecosystem reveals a clear “extreme dichotomy” to investors:
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Year-to-date declines are generally between 50–70%, with drops exceeding 90% from peak levels being common;
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Fundamental progress for most projects lags significantly; BTC L2 solutions are largely idle, lacking mature product rollouts;
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Airdrops and incentives have fallen short of expectations. Some projects once held high hopes saw slow ecosystem development, leading to prolonged lack of community confidence;
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Protocols remain fragmented, with protocol-specific热度 like Runes quickly dissipating. Although Runes briefly accounted for over 60% of BTC on-chain transactions at launch, that data peak lasted only a few days before rapidly declining to single-digit percentages.
In terms of deployed BRC20 tokens, activity has now approached a "freezing point"
These figures indicate that this rally is not built upon strong fundamental shifts, but rather resembles a high-beta play driven by "sentiment repair" and "capital rotation."
Why Rebound Now?
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Clear shift in market regime
Ethereum previously rebounded 50% despite significant community FUD, validating a classic "low-expectation reversal" market structure. This phenomenon has triggered capital rotation into sectors with lower valuations and deeper corrections.
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Bitcoin ecosystem experienced extreme drawdowns, offering high elasticity
Virtually all top projects have declined over 90% since last year’s peak, leading markets to widely perceive them as “priced beyond any trading logic.” Yet rallies often originate precisely from such abandoned areas.
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Increase in speculative positioning
Assets from marginal ecosystems have instead become highly volatile targets for short-term capital attacks.
Will This Rally Be Sustainable?
Despite the eye-catching current gains, extending the timeframe reveals that this Bitcoin ecosystem rebound appears more as an expectation reset rather than confirmed trend reversal. The internal ecosystem still faces structural issues that constrain sustained performance.
First, overall development pace remains slow—whether for BRC-20 or Runes—with project rollouts continuing at a sluggish rate. The much-anticipated "Bitcoin-native DeFi" has yet to form a complete vertical stack, and the lack of supporting infrastructure prevents real synergies within the ecosystem. Moreover, developer enthusiasm has waned. GitHub update frequencies for multiple core projects have visibly declined, and overall technical community activity lags far behind chains like Ethereum and Solana. Amid temporary shifts in capital and user attention, the cooling of the developer ecosystem further weakens medium-term outlooks.
Overall, this rally resembles a “corrective catch-up” triggered by extremely low valuations and extremely weak expectations. After a year of emotional exhaustion and valuation contraction, capital is revisiting these deeply discounted assets during a market regime shift, unlocking short-term elasticity.
For the Bitcoin ecosystem to truly establish an independent bull run, price appreciation alone is insufficient. Ecosystem recovery depends on more solid product delivery, more compelling user growth metrics, and renewed community cohesion. If the rebound can be ignited by sentiment, then sustained trends must be built on confidence and tangible progress.
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