OKX Research: Russia-Ukraine Situation & U.S. Rate Hikes — Who Is Driving Bitcoin?
As the Russia-Ukraine conflict situation temporarily eased, the chairman of the Russian Duma Energy Committee stated willingness to accept Bitcoin as a payment method for natural resource exports; at the same time, with the U.S. Federal Reserve's interest rate hikes and central bank monetary easing policies changing, the financial market rebounded, with Bitcoin price recovering to $48,000.
On March 31, OKX partnered with Planet Daily to launch a brand new column, "Xpace." The first episode of the AMA was hosted by Odaily CEO Mandy, and featured four guests: OKX Financial Market Director Lennix, Tokeninsight CEO Wayne, Digital Renaissance Foundation Managing Director Cao Yin, and blockchain commentator Super Jun. They shared their perspectives on how to judge the future direction of the crypto market under the current situation and the development of the NFT market (Guest perspectives are for informational reference only and do not constitute any investment advice).
Q1: What are the driving factors behind this round of Bitcoin price increases and what is the outlook ahead?
Cao Yin: The Russia-Ukraine conflict is not the main reason affecting Bitcoin's price. The main factor is the hawkish atmosphere from the Fed's interest rate hikes drawing large amounts of investment funds in. With new mechanisms continuously being added, Bitcoin's trend will still show an upward trajectory in the mid-to-short term.
Super Jun: With restrictions imposed on Russia by the U.S. and EU countries, Bitcoin's coefficient is truly being reflected. Bitcoin is a free asset with more limited value. Currently, confidence in Bitcoin across the industry is sufficient, and reserves for stablecoins will tilt toward Bitcoin.
Wayne: Whether people's perception of Bitcoin can shift to a safe-haven asset is crucial, and it simultaneously affects Bitcoin's price.
Lennix: Bitcoin's market performance after institutional entry is more akin to tech stocks. Bitcoin represents new technology, and its price behavior is very similar. Bitcoin is also influenced by U.S. stocks. When Bitcoin's free asset characteristics rise, it can relatively detach from the correlation with U.S. stocks and reflect Bitcoin's own value.
Q2: What is the likelihood of the Fed continuing to raise interest rates, and what impact do rate hikes have on financial assets like Bitcoin?
Cao Yin: Looking at U.S. Q1 GDP, it fell short of expectations. The U.S. is also at a critical juncture, with the Russia-Ukraine war winding down and speculative funds in international commodities retreating, which will not have a major impact. With the normalization of the pandemic, the global supply chain has entered a new normal, and U.S. CPI for consumer and industrial goods will be affected.
Based on the Fed's macroeconomic market operations and a series of central bank actions, there will not be extreme impacts on financial assets like Bitcoin.
Super Jun: Institutions that have allocated Bitcoin as an asset will closely monitor the impact of rate hikes and make selling decisions accordingly. The ideology born from turbulence has made people recognize Bitcoin as a free asset or global asset. With the influx of younger generations, the overall caliber of cryptocurrency industry participants will improve.
Lennix: The market currently anticipates rate hikes, but the pace and intensity of hikes are relatively difficult to predict. Currently, the U.S. and the overall economic system face relatively severe inflation risk. Inflation continues to rise, driven by the impact of the Russia-Ukraine war, which caused commodity prices to surge sharply, leading to more pronounced inflation.
The last FMC U.S. individual income tax has already been collected, with expectations worse than anticipated. The operational space available to central banks is very limited, and the risk to the overall monetary policy is relatively high. For this reason, the FMC may adopt a more hawkish approach, increasing the pace of rate hikes, hoping to suppress inflation in the early phase, and creating more operational space later in the second half of the year or next year.
Additionally, the balance sheet reduction policy was announced. It is expected that the market did not fully react significantly to balance sheet reduction, because compared to rate hikes, the latter has a greater impact on asset prices. Rate hikes merely tighten liquidity, while balance sheet reduction does the opposite. One expectation is that the two major uncertainties that could have a greater impact on overall stock or various risk asset prices are hanging overhead, creating relatively high risk going forward — whether for Bitcoin or stocks.
Q3: How do you view the surge in altcoin prices? Is this the start of an "alt season," or the last狂欢?
Cao Yin: Altcoins may plummet by 90% or more — I think that's a fair statement. Whether the market will have a two-year long bear market like in 2018, 2019, and early 2020, or enter a new normal where dips are immediately bought back, will certainly be different. I think altcoin declines are completely normal — up and down. The market's valuation system for altcoins has been constantly adjusting, which is normal.
For altcoins, maintain long-term attention — there are always opportunities. For familiar tokens, especially promising sectors, keep long-term tracking. Even for altcoins, treat them as blue chips — this is a strategy I have personally adhered to.
Super Jun: I am particularly devoted to the DeFi sector. My view is that DeFi protocols are beautiful but have significant泡沫. The basis for mining participation is whether daily earnings exceed the value of tokens being released — if so, the泡沫 is small. The reason fewer people are participating in DeFi is the frequent security incidents. Beyond DeFi, there are public chains — there are too many now, and most cannot be sustained. Focus mainly on the top-ranked public chains.
Wayne: To buy Crypto, you still need to buy altcoins. If you don't buy altcoins, you might as well trade stocks. Only altcoins offer relatively large opportunities. When trading altcoins, look for familiar tokens and maintain long-term attention. You don't need to follow too many — you can never keep up with trending topics anyway. Focus on those you understand relatively well — token unlocks, market cap, price movements — then buy and sell at appropriate levels.
Lennix: DeFi tokens within altcoins are in a de-bubbling process. Comparing the fees DeFi generates with its market price is an excellent method for fundamental price calculation. At this stage, whether DeFi has completely removed all泡沫 is very difficult to determine. Current use cases include lending, Trading, leverage, and so on. The scenarios are relatively limited and require time to be tested.
The profits generated by actual demand in DeFi are already much better than tokens without real use cases. Therefore, from an asset allocation perspective, beyond BTC and ETH, DeFi is certainly a relatively reasonable investment selection for bottom-fishing.
Q4: NFT has been a market hotspot over the past year, with flagship NFT projects like BAYC and Azuki also becoming focal points. How do the guests view the NFT hype? Which NFT projects are worth acquiring? What characteristics should promising NFT projects have?
Cao Yin: These so-called profile picture NFTs have now entered a contrasting phase. Using monkeys or punks as avatars once felt like Web3.0, representing a distinctive new identity. The truly creative native or what we call Web3 native new identity — but now it has become something else. It has entered another form of commercialization, a kind of standardized personal image. It no longer represents individuality — it only shows that you are a player, with lots of trendy culture. So I no longer use the NFTs I bought as my avatar. Instead, I draw my own avatar every day — it is more unique, more fun, and more distinctive.
On the flip side, from an investment and speculation perspective, NFT is an excellent target. Setting aside the so-called Web3.0 and cultural aspects of NFTs, the NFT itself follows a typical speculation logic. Its supply is inherently limited — for example, only 10,000 are minted — and most players hold multiple, making price manipulation relatively easy. NFTs are different from assets like Ethereum. For Ethereum, you need to convince people to buy it; NFTs only need to do one thing: convince people not to sell. All successfully priced NFTs do one thing: keep people from selling, constantly building expectations, creating opportunities to cash out through derivatives or airdrops. NFTs are exactly like altcoins. Treat all your altcoins equally — when they rise to your target, sell; when they drop and you believe the asset has future potential, buy. Just treat it as a chip — do not develop faith in it.
Wayne: I have bought some NFTs, but only on colleagues' recommendations. A big reason is that I feel the current NFT market resembles the Dutch Tulip Mania — you might find it strange that in 5 or 10 years, many people will look back and wonder why anyone paid tens of thousands for a picture. Influenced by this thinking, I proactively choose not to buy. Genuine NFT purchases should be based on mutual recognition, and then discussing meaningful things — where the other person fits that feeling, giving a very positive impression. To be direct, one type is purchasing for that feeling; the other is pure speculation.
Lennix: The current NFT market is very similar to the 2017 bubble. ICOs had only whitepapers, all trying various methods to suppress and delay unlocking. NFTs similarly lack real use cases, while DeFi can relatively solve some of these use cases.
For NFT investment, two aspects are monitored. First, profile picture and product NFTs can serve as an entry ticket, granting access to participate in NFT projects or becoming a member, which helps me discover NFT projects more easily. Second, the NFT's own use cases.
ΦΦ The above is the content of OKX & Planet Daily's first episode of "Xpace." The next episode of "Xpace" will focus on 【Will There Be an NFT Bull Market in April? What Kind of NFT Projects Have Blue-Chip Potential?】 Follow "OKXOKX" on X (Twitter) for more exciting content.
Disclaimer
This article may contain product-related content not applicable to your region. This article is committed to providing general information only and does not accept responsibility for any factual errors or omissions herein. This article represents the author's personal views only and does not represent OKX's views. This article is not intended to provide any advice, including but not limited to: (i) investment advice or investment recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; or (iii) financial, accounting, legal, or tax advice. Holding digital assets (including stablecoins) involves high risk and may be subject to significant price fluctuations, or may even become worthless. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. For questions about your specific circumstances, please consult your legal/tax/investment professional. The information contained in this article (including market data and statistics, where applicable) is for general reference purposes only. Although we have taken all reasonable precautions in preparing such data and charts, we assume no responsibility for any factual errors or omissions expressed herein. © 2025 OKX. This article may be reproduced or distributed in its entirety, or excerpts of 100 words or less may be used, provided that such use is non-commercial. Any reproduction or distribution of the full article must prominently state: "This article is copyrighted © 2025 OKX, used with permission." Permitted excerpts must cite the article title and include attribution, e.g., "Article Title, [Author Name (if applicable)], © 2025 OKX." Some content may have been generated or assisted by artificial intelligence (AI) tools. Derivative works and other uses of this article are not permitted.
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