Why hasn't your coin increased in value?

Core Viewpoint

There has been a deep-seated assumption in Crypto Twitter:

"As long as institutions come in, regulations clarify, and JPMorgan or BlackRock issue tokens… crypto will conquer everything, and we will go to the moon." Everything we wanted has arrived ------ but they haven't driven prices.

Why? Because the entire crypto market is often disconnected from reality. Bitcoin is a unique entity ------ a perfect narrative: digital gold. Its market cap is about $1.9 trillion, while gold is around $29 trillion. Less than 10% of gold's market cap, with room for growth in the future. This is a well-understood hedge + option value combination.

But Ethereum + Ripple + Solana + everything else combined has a market cap of ~ $1.5 trillion, and the narrative isn't as stable. Although no one questions the potential of this technology anymore, and few still call it a scam, the real question is: does an industry with possibly only 40 million active users really justify a valuation in the trillions? Meanwhile, OpenAI is rumored to have an IPO valuation close to $1 trillion, with a user base about 20 times that of the entire crypto industry.

How much real value have these chains created? Can they support so much money? In the past, the answer to making money was simple: invest in infrastructure. Early holders or participants in ETH, SOL, DeFi. But now, many projects are priced with the assumption that there will definitely be 100 times the usage and 100 times the revenue, and after issuing tokens, they become ghost chains.

This forces us to ask the real question: what is the best way to invest in crypto now?

This cycle has seen a triple resonance of favorable regulations, industry, and enterprises, but the market and prices reflect three facts:

The market doesn't care about your story; investment returns to fundamentals. No matter how a chain claims to be the "mother of all chains" or the "world computer," in the end, it still comes down to: how much money is actually made each year? Does this income come from real economic activity?
Crypto is no longer the "only hot spot." Previously: the "high Beta gambling table" for global risk capital was in crypto.

Now: AI has become the main character, and crypto has taken a back seat. Liquidity is selective; AI is the main character, and crypto is not.

Enterprises follow business logic, not crypto narratives.

Enterprises only care about: compliance costs, integration costs, operational costs, and stability.

The launch of Stripe's Tempo is a warning: enterprises won't think ETH is the world's supercomputer just because they listened to Bankless. They will choose the option that is most beneficial to them. If private chains or consortium chains are more useful, they may not come to L1 or L2 public chains.

When prices are excessively overvalued, all it takes is a cough from Powell for the entire narrative to collapse.

Valuation Misconception: Treating "casino turnover" as "software revenue"

Many people use the Web2 framework to value public chains: "Public chains have revenue, transaction fees, MEV, staking, isn't it a bit like SaaS?" This is actually a very dangerous analogy. Staking rewards ≠ corporate profits; they are inflation, dilution, and security costs. The real "economic value" roughly comes from: transaction fees, tips, and MEV (extractable value), which can barely be considered the "gross revenue" of public chains. In this regard: Ethereum: about $2 billion in annual revenue, market cap ~ $400 billion, about 200-400x PS (and it's still cyclical revenue); Solana: annualized over $1 billion, market cap ~ $75-80 billion, about 20-60x PS.

Moreover, there is an even scarier fact: this is not "compoundable income"; this income is not stable, enterprise-level regular income, but highly cyclical speculative flow. This is not SaaS income; this is Las Vegas. When is it at its peak? At the bull market's peak: perpetual contracts surge, meme coins explode, leverage, liquidations, and front-running are everywhere, and bots are arbitraging crazily. When does it almost disappear? During the bear market vacuum: no one trades, no one mints, liquidations decrease, and on-chain activity is sluggish. This is not: long-term contracts or predictable income; rather, it's "three years without opening, and when it opens, it eats for three years" cyclical turnover.

You can't apply Shopify's valuation multiples to a casino that only fills up every 3-4 years.

Comparing with NVDA shows how big the crypto bubble is

Compare it with the "god" of the tech world ------ Nvidia, which has a valuation of 40-45x earnings (not revenue). Nvidia has: real revenue, real profits, global enterprise demand, predictable contract sales, and non-casino users.

If the industry's transaction fees cannot shift from speculation to real economic value, most valuations will need to be repriced.

The industry is indeed still in its infancy; it just hasn't arrived at "everything you buy goes up"

Prices will eventually return to fundamentals, but we are not there yet. Currently:

Most tokens have no reason to support huge valuations
Value capture is limited
Revenue mainly relies on cyclical speculation of casino products

We have built the world's fastest value transfer system… but use it to play slot machines.

As Netflix co-founder Marc Randolph said: "Culture is not what you say, but what you do." Industry leaders keep saying: we need decentralization, yet the most important product in the crypto industry is 10x leveraged perpetual contracts for memecoins. Only when we do better can we move from "over-financialized niche casinos" to real industries.

I don't think this is the end of crypto. But I believe this is "the end of the beginning."

We have over-invested in infrastructure (over $100 billion) while seriously underestimating the real application layer, products, and users.

Investors have focused their energy on:

TPS
Block space
Fancy rollup structures

But users don't care at all.

Users only care about: cheaper, faster, simpler, and whether it can solve their problems.

Returning to first principles: who are the users? What problems are we solving?

Where are the real investment opportunities?

I have been bullish on crypto for over a decade, and that hasn't changed. I still believe:

Stablecoins will become the default payment rails
Open, neutral infrastructure will drive global finance
Enterprises adopt crypto technology for economic advantages, not ideology

But I don't believe the big winners of the next decade will be today's L1 or L2. The history of technology tells us: winners are always at the user aggregation layer, not the infrastructure layer. The internet made computing and storage cheaper, and the real money was made by: Amazon, Google, Apple.

Crypto will also follow a similar rhythm:

Block space is a commodity
Infrastructure upgrades have diminishing marginal returns
Users are always willing to pay for convenience
User aggregators will capture the most value

The real big opportunity is: embedding crypto technology into already large enterprises, replacing outdated financial pipelines, and improving real business efficiency. This is the trillion-dollar opportunity. The internet changed every industry because the economic calculations made sense. Crypto will be the same. The question is: do we wait another 10 years, or start now?

What should we do now?

Blockchain technology is fine
Huge potential
The industry is still in its early stages

What we need to do next is to reassess:

Evaluate projects based on real usage and "income quality," not ideology
Distinguish between "sustainable income" and "cyclical casino income"
The winners of the last cycle may not be the kings of the next cycle
Stop treating token prices as indicators of technological validation

No one will choose AWS over Azure just because Amazon's stock price was stronger than Microsoft's one week. We can continue to sit and wait for enterprises to adopt, or we can start pushing it now. Move real GDP onto the chain.

Job's not finished.

What should we do now? · Blockchain technology is fine · Huge potential · The industry is still in its early stages What we need to do next is to reassess: · Evaluate projects based on real usage and "income quality."
Processing…
Processing…
Processing…
Processing…
Processing…