On October 11, 2025, the entire crypto market experienced a significant pullback. Bitcoin slid from a high of nearly $126,300 to around $107,000; Ethereum dropped from about $4,800 to around $3,500. According to public data, this correction triggered approximately $20 billion in liquidations within just 24 hours, making it the largest concentrated liquidation event of the year so far, potentially affecting over 1.6 million trading accounts.

Following this pullback, Portal Labs observed that the internet "once again" began to see scattered voices of reflection :).

Many market participants realized that being overly obsessed with price fluctuations and leverage trading only leads to being swept up by FOMO emotions, while neglecting Web3 projects that are truly and consistently building long-term value.

At the same time, there were also discussions about "bull and bear" markets. For instance, Alex Thorn, Head of Research at Galaxy Digital, pointed out in the Weekly Tops Stories published on October 19th: although the market remains vulnerable in the short term, the medium-term structural bull market is still intact.

So, what could provide support for the upcoming bull market? Alex Thorn believes three major tracks are advancing together:

First, AI Capital Expenditure (AI Capex)

Thorn pointed out that the current cycle of AI infrastructure construction is becoming a real-world "super cycle." Whether it's the data center expansion by cloud computing giants or the large-scale capacity investment by chip manufacturers, it all signifies that the capital and computing power demands for AI continue to rise. Blockchain and crypto assets恰好 have the opportunity to play roles in data ownership verification, computing power matching, and incentive mechanisms. Therefore, AI is not just a passing trend but an industrial-scale momentum that can bring sustained external support to the crypto market.

Second, Stablecoins

Stablecoins remain the hub for on-chain capital flows. Thorn emphasized that the continuous growth in the usage scale and penetration of stablecoins not only deepens on-chain liquidity but also expands application scenarios for real payments and settlements. From cross-border settlements and DeFi liquidations to daily payments for users in emerging markets, stablecoins are becoming the "underlying pipeline" driving the vitality of the on-chain economy.

Third, Asset Tokenization (Tokenization / RWA)

The tokenization of real-world assets is shifting from proof-of-concept to substantive implementation. Whether it's bonds, funds, real estate, or carbon credits, tokenization not only provides traditional financial markets with new liquidity tools but also creates new trading demands and value carriers for blockchain itself. Thorn believes this is a bridge spanning traditional finance and crypto, and it will become the most certain incremental space in the coming years.

In Thorn's view, Bitcoin's "digital gold" attribute remains unshaken. Especially when there is widespread external skepticism about the sustainability of fiscal and monetary policies, Bitcoin remains an important tool for hedging risks. Meanwhile, mainstream public chains like Ethereum (ETH) and Solana (SOL), being closely tied to stablecoin usage and asset tokenization, are also seen as having fertile ground for development. However, in the short term, price action might still fluctuate below previous highs. From a medium-term perspective, the market remains resilient. The three forces of AI investment, stablecoin growth, and asset tokenization will form the structural support for the crypto market's continued upward movement.

Portal Labs, on the other hand, believes that these three major trends are not only the driving force for the medium-term market uptrend but also key areas that Web3 entrepreneurs need to focus on. For entrepreneurs, they represent the infrastructure and application scenarios that are likely to be implemented in the coming years, and they also delineate which areas are more likely to attract capital favor and policy support.

For Chinese Web3 entrepreneurs, how can they find their place within these trends?

First, Focus on the Intersection from Data to Computing Power

For Chinese entrepreneurs, the integration of AI and blockchain is not an abstract "crossover" but can be practically applied in computing power scheduling, data ownership verification, and privacy protection. Current mainland policies encourage "data要素" and "computing power networks." Therefore, Web3 startup teams can focus on the direction of "on-chain data circulation + computing power sharing," treating blockchain as a tool rather than a speculative narrative.

Simultaneously, they should avoid simply packaging "AI + Token" as a fundraising method; Chinese Web3 is more suited to be positioned as "blockchain assistance for AI infrastructure."

Second, Payment Infrastructure, Not Token Speculation

Globally, stablecoins have become pipelines for on-chain funds, but in mainland China, their issuance and circulation are policy red lines. For Web3 entrepreneurs, the opportunity lies in "payment infrastructure surrounding stablecoins," not in creating stablecoins themselves. For example, cross-border clearing, on-chain payment channels, and compliant KYC services are directions allowed for exploration under the regulations of Hong Kong and Singapore.

Furthermore, as directly creating stablecoins domestically is impossible, Web3 entrepreneurs can consider entering through Hong Kong VASPs or payment licenses to serve the needs of outgoing capital and enterprises.

Third, Start with Tool Platforms

RWA is the most certain trend but also the most heavily regulated area. For Chinese Web3 entrepreneurs, directly engaging in "tokenized issuance" carries extremely high risks. A more reasonable path is to "provide compliant tools and services," such as asset registration, on-chain credentials, and compliant API interfaces, helping traditional asset management institutions achieve digitization. Hong Kong's stablecoin and RWA frameworks provide an institutional window for mainland Web3 entrepreneurs, but on the precondition that domestic and international markets must be segregated in the business structure.

Therefore, Web3 entrepreneurs can position themselves as "infrastructure service providers" rather than "asset issuers." This is key to long-term survival.

The alternation of bull and bear markets is an inevitable natural cycle. However, for Web3 entrepreneurs, what truly determines how far they can go is whether, during the intervals of these cycles, they focus their energy on commercial implementation, infrastructure construction, refining underlying technology, and aligning with regulatory frameworks. The market always rewards those teams that remain focused on value creation after the noise fades away.

Moving forward, China's Web3 entrepreneurship should, within these trends of AI, stablecoins, and RWA, find entry points that can accumulate industrial value, solidify the construction, and adhere to long-termism to the end.