The panic is receding, dawn is approaching, where will the next undercurrent come from?

In the past month, Bitcoin has been fluctuating steadily above $55,000, while Ethereum has hit a record high of $4,300. Investors have been fantasizing about drinking the milk and honey of the "eternal bull market". But the script suddenly changed, and the myth of the legendary "eternal bull market" took a sharp turn for the worse. One after another, huge negative news hit the key points. Bitcoin fell below $30,000, and Ethereum was even more tragic. In about 10 days, the price was wiped out by nearly 60%, and once fell below $1,800. But on the 23rd, it seemed that someone pressed the "pause button" of the plunge. Bitcoin and Ethereum rebounded slightly. On the first day of the consensus summit recently held by Coindesk, Ethereum's daily increase exceeded 40%, which made the "diamond hands" who survived this disaster seem to see the dawn of hope.

Bitcoin has gradually recovered its lost ground and successfully stabilized at $36,000. It has tried to break through the key position of $40,000 many times. Although it failed to break through, it still oscillates above $38,000, with a 24-hour increase of 1.31%.

Earlier, there were reports that Michael Saylor, the CEO of MicroStrategy, who is regarded as a "savior" on social media, retweeted the tweet and said that through his introduction, Elon Musk met with a group of mining companies in North America, and the mining companies agreed to establish a Bitcoin Mining Council to improve transparency in energy use and accelerate global sustainability initiatives.

It is reported that representatives from Argo Blockchain, Blockcap, Core Scientific, Galaxy Digital, Hive Blockchain, Hut 8 Mining, Marathon Digital Holdings and Riot Blockchain participated in the meeting. The companies agreed to form an organization to promote the standardization of electricity reporting, pursue corporate environmental, social and governance performance, and jointly cultivate and promote market growth. Peter Wall, CEO of listed Bitcoin mining company Argo Blockchain, said that the "Bitcoin Mining Committee" led by Elon Musk and MicroStrategy CEO Michael Saylor will not change the code or homogeneity of Bitcoin, and will not distinguish between clean and unclean Bitcoin.

From the perspective of influence, this is indeed good news, but looking at this issue from the nature of Bitcoin, it seems difficult for us to regard this news as "good" news.

AvantiBT founder Caitlin Long called the meeting between the two giants the "peak" of panic, and she predicted that ransomware might be the source of the next wave of panic.

The Bitcoin community was also dissatisfied with the closed-door meeting between Musk and miners from North America. A Bitcoin miner tweeted that he was disgusted with the way a small group decided the whole and defined mining behavior. He believed that miners should prioritize their interests and did not need an association to decide what energy was clean and what energy was dirty.

Although the price of Bitcoin has recovered to some extent from last week's plunge, there are still many uncertainties in the market. Considering that this year marks the 100th anniversary of the founding of the Communist Party of China, this year's regulatory pace may have just taken the first step. At present, there are market rumors that relevant Chinese agencies have begun to take measures to "crack down on Bitcoin mining and trading activities." First, in view of the huge energy consumption of Bitcoin mining, digital encrypted asset mining farms in China may be completely shut down; second, banks are comprehensively checking suspicious accounts, and immediately taking regulatory measures and reporting daily for encrypted digital asset C2C matchmaking dealers with large amounts or numbers; third, in view of the fact that Bitcoin futures trading and contract trading are suspected of illegal futures operations, relevant departments are formulating policies to crack down on encrypted digital asset trading platforms that provide such services; fourth, severely investigate and punish IDC service providers that provide so-called "return routes" and other services to overseas encrypted virtual currency trading platforms.

Another huge uncertainty is the Federal Reserve. Recently, relevant departments have begun to release signals that they want to discuss reducing QE. Last Wednesday, the Federal Reserve released the minutes of its April monetary policy meeting. The minutes showed that the United States still has some time to make substantial progress; the US economy is still far from achieving the FOMC's (employment and inflation) goals; and pointed out that the risks to the outlook are not as high as in previous months. At the same time, some Fed officials expect that the Federal Reserve will begin to discuss reducing QE in the next few meetings; inflation is expected to ease after a short rise, and bottleneck problems may continue to pose price pressures after 2021.

This will most likely lead to an early interest rate hike at the end of 2022, and more investors may not be willing to use a 100% loss to gain a short-term 30%-50% increase in cryptocurrency. More people will choose to lock in profits or cut their losses and leave. Of course, there is still no shortage of "brave people" in the market, which naturally leads to the current polarized investment sentiment.