The well-known Twitter account @MilesDeutscher poured cold water on Ethereum supporters amid the frenzy over the Trump meme coin, TRUMP.

He introduced a new paradigm for cryptocurrency investment stages, hinting at shifts in market dynamics influenced by political changes. The incoming Trump administration is expected to create a more crypto-friendly environment, potentially impacting the stages mentioned in the post, especially considering influential figures like Elon Musk in Trump’s circle who support cryptocurrencies.

In the second stage of this new paradigm, Solana (SOL) was highlighted for its fast transaction speeds and low fees, which give it an edge in the current market environment.

This image is a visual chart describing the flow of funds and market phases in the cryptocurrency market. It is divided into four main phases (Phase 1 to Phase 4), represented by different block colors.

Here is an explanation of the chart’s content:

Table of contents

- [Phase 1: $Trump](https://abmedia.io/financial-independence-etf#Phase_1_TRUMP)
- [Phase 2: $SOL](https://abmedia.io/financial-independence-etf#Phase_2_SOL)
- [Phase 4: Altseason (山寨币季)](https://abmedia.io/financial-independence-etf#Phase_4_Altseason%EF%BC%88%E5%B1%B1%E5%AF%A8%E5%B9%A3%E5%AD%A3%EF%BC%89)

The Competition Between ETH and SOL: Ideologies Corresponding to Current Trends

Phase 1: $Trump

• Description: Funds begin flowing into specific cryptocurrencies (using $TRUMP as an example here), leading to a rapid price surge.
• Features: This is the initial stage of the market, usually marked by a few specific cryptocurrencies attracting substantial investments.

(Originally, Phase 1 and Phase 2 in the chart overlapped with ETH. However, it has now been replaced by SOL. Funds gradually flow toward SOL, but SOL might not fully keep pace with Bitcoin’s growth. Features: SOL’s price performance starts to outpace Bitcoin, and funds begin moving back and forth between the two.)

Phase 2: $SOL

• Description: Funds flow into other major cryptocurrencies (represented here by $SOL, standing for Solana).
• Features: Major cryptocurrencies start attracting large-scale investments, and the market enters the next wave of growth.

(Previously, the chart included a Phase 3 for large-cap coins, where after Phase 2 coins reach a peak in popularity, funds would shift to other large-cap coins before entering Altseason. However, under the new paradigm, particularly with this TRUMP craze, @milesdeutscher believes Phase 3 won’t happen, and the market will transition directly to Phase 4, Altseason.)

Phase 4: Altseason (altcoin season)

• Description: Funds flow into small- and micro-cap cryptocurrencies, leading to a massive surge in almost all cryptocurrency prices, regardless of fundamentals.
• Features:
  • Major cryptocurrencies reach their price peaks.
  • Small- and micro-cap cryptocurrencies (altcoins) experience widespread surges.
  • The market is filled with euphoria, investor sentiment is extremely high, and all kinds of tokens (including meme coins) skyrocket.

ETH and SOL Competition: Corresponding Ideologies

In the author’s view, the competition between ETH and SOL can be likened to the contrast between idealism and realism:

• ETH (Ethereum) symbolizes innovation and decentralization, much like the academic tradition of the Renaissance, pursuing the purity of technology and idealistic values. The Ethereum ecosystem is filled with technological innovation, from DeFi (decentralized finance) to NFTs (non-fungible tokens), all initiated by Ethereum. However, the reality is that, in a profit-driven market, Ethereum’s ideals are often challenged. Vitalik’s recent public statement expressing “Ethereum will not dominate the direction, but rather support developers’ freedom to innovate” may be a response to pressure from the DeFi community, also revealing the tension within Ethereum between idealism and reality.
• SOL (Solana), on the other hand, represents a form of realism. It is like the entrepreneurs of the Industrial Revolution, focusing more on efficiency, speed, and the rapid application of business use cases. The Solana ecosystem is clearly driven by the US-based development community and commercial interests, with its flexibility and high performance (such as high TPS) attracting substantial funds and business projects. Moreover, Solana’s development aligns with the current global political environment, particularly trends of anti-globalization and US protectionism, making it more competitive. Recently, the meme coins pushed by Trump’s team have further highlighted Solana’s connection to American politics and business interests.

Overall,

• Ethereum remains the main ground for innovative technologies, attracting developers and enterprises seeking to push the boundaries of blockchain applications.
• In contrast, Solana’s ecosystem is more inclined towards rapid expansion, especially in environments with fewer restrictions and greater freedom. With the driving force of market speculation and commercial interests, Solana may experience even greater growth this year.

ETH hits new low against BTC since April 2021

SOL continues to rise against BTC

Risk warning

Cryptocurrency investment carries high risks, and its prices may fluctuate significantly. You may lose your entire principal. Please carefully assess the risks.

Disclaimer:

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2. Disclaimer: The views and opinions expressed in this article represent only the author’s personal views and do not constitute any investment advice.
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