PLS is supported by improving market sentiment in the short term, with its price maintaining range-bound fluctuations (reference range ±8%). Trading volume has not seen significant expansion. Caution is advised against false breakouts and pullbacks. Structurally, if the market evolves from a binary option model to perpetual contracts, liquidity and capital efficiency would significantly improve, potentially reshaping the long-term value logic of PLS. Currently, liquidity differentiation is pronounced, and there is a risk of trading exhaustion in the short term, but macro events and growing hedging demand are creating incremental opportunities for the token. It's recommended to wait for breakout signals and prioritize core position allocation before major geopolitical events to optimize medium- and long-term portfolio strategies.

Recently, the crypto market has shown signs of improvement, boosting short-term sentiment for PLS. However, candlestick charts reveal that prices continue to fluctuate within a relatively narrow range, and trading volume has not significantly increased. Bulls and bears remain in a stalemate. In the short term, it is still necessary to be vigilant for pullback risks and to wait for clearer breakout directions.

CryptoQuant analyst Darkfrost noted on January 4 that the cryptocurrency market is beginning to improve, urging caution against dismissing this trend prematurely. While more data is needed for definitive conclusions, some trend changes are starting to emerge, making this a critical time to pay close attention.

Analysis: The crypto market is beginning to improve, with some trend changes gradually becoming apparent.

The current binary option mode underpinning prediction markets suffers from insufficient liquidity and low capital efficiency, which makes it hard to support the sustainable prosperity of token ecosystems. Breaking through this ‘local optimum’ bottleneck calls for the industry to evolve towards a perpetual contract model, constructing more versatile and deeper liquidity pools. This structural reform will directly influence the value-accretion path of PLS as an ecosystem token.

The article critically examines the current state of prediction markets, arguing they have fallen into a "local optimum" trap similar to past tech failures like BlackBerry and Yahoo. While binary options models have gained short-term traction, they suffer from liquidity shortages and low capital efficiency. The author advocates evolving prediction markets toward a perpetual contract model to achieve a truly universal, liquid market, emphasizing the need for radical redesign and humility to overcome structural limitations and realize their full potential.

Falling into a local optimum, market predictions should not stop here.

The article discusses the challenges of market making in prediction markets, highlighting that less than 10% survive until year-end. Unlike AMM-based markets, prediction markets rely on order book models with higher operational complexity, inventory risk, and volatile, jumpy price movements driven by discrete events. Successful market making requires advanced strategies and risk management, often beyond ordinary users' capabilities. Leading platforms like Polymarket and Kalshi invest heavily in liquidity subsidies, creating strong barriers for new entrants and reinforcing dominant players.

Prediction markets are tough: less than 10% may actually survive until the end of the year.

Market data shows that short-term contract trading is highly concentrated, while overall transaction activity remains low, indicating that PLS may face liquidity exhaustion risks in short-term trading. However, in the long run, macro hedging demand driven by political and geopolitical events is accelerating, and this niche within prediction markets may open new liquidity windows for PLS. Investors may capitalize on important event milestones to position for medium- to long-term holdings and capture opportunities for value revaluation.

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