Translation: Blockchain in Vernacular
The crypto market as a whole is up over $2 trillion year-over-year, while altcoins are collectively up 70%. So why are many recently launched projects underperforming? The main reason is attention dilution, as millions of new tokens are launched in 2024.
@pumpdotfun was singlehandedly responsible for the launch of over 2 million Memecoins, which diluted the overall attention significantly. Institutional participation has become more critical than ever for the network, and this was best demonstrated with the launch of the Bitcoin ETF.
Does the increase in token listings indicate a focus on quantity over quality?
Users may feel overwhelmed by the choices, leading to reduced activity on platforms like Coinbase. They may become fatigued or uninterested in new tokens due to market volatility, regulatory concerns, or a lack of compelling use cases.
Institutional support is one reason why tokens like $MOCA, $SOL, $BNB, and $TON have performed well. As @blockchaingmg said, “MOCA token from @animocabrands is the only bright spot, up 51% since launch price.”
@animocabrands is now expanding their investments to include listed tokens, focusing on their portfolio. In this competitive market, Web3 projects that can attract institutional attention will stand out more easily, thus partially alleviating the problem of attention dilution.
Various opinions have been analyzed in detail by @hosseeb and other experts, and one of the most concerned reasons is high FDV. Although there are many factors, the conclusion is that these problems are not fundamental.
Currently, the launch of alternative coins is far outpacing the growth of Web3 network participants, similar to the launch of websites, message boards, and chat rooms during the dot-com bubble, or the launch of smartphone apps in 2010-12.
Unlike the U.S. stock market, which has approximately 80% institutional participation, digital assets currently attract only 5% of institutional funds and are mainly concentrated in Bitcoin, which means there is still a lot of room for growth.
While building communities and expanding networks remain extremely important and core to a project’s products and services, in my opinion, projects that can attract institutional participation will have an advantage in the current market environment.
