The Chaos of a Flood of Cryptocurrency Projects Interwoven with Speculation and Practical Project Value:

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Disclaimer:

First, I want to save your time. If you are an experienced observer or participant in the digital world of cryptocurrencies, I doubt this article will be helpful to you. It is more of a minor option for newcomers who may be confused by the number of cryptocurrency projects without understanding how to position themselves towards each of them. I would also like to emphasize that the information I provide is purely hypothetical theory, and I cannot guarantee it will be appropriate for every situation. I encourage you to share your thoughts in the comments, as they may prove to be even more valuable than the article itself.

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There is a certain activity in generating new cryptocurrency projects. The scope of actions taken in this regard may raise doubts about the possibility of familiarizing oneself with every emerging project. This situation may seem chaotic, where we need to recognize which projects are valuable in terms of actual user benefits and which ones are merely discretionary and speculative. The fundamental questions for determining a position may be:

- What is the new token?

- What does it mean to be a holder of a specific project's tokens?

- What is the real demand for the benefits of holding and trading a specific token?

- Does the current value of a particular project's token arise from the demand for its use case, or from the speculative accumulation driven by a pyramid-like belief in its growth, becoming a self-sustaining machine fueled by the increasing capital of those who believe in it?

By spending time on these and other valuable questions, of which there could be more in this article, it may turn out that this data is achievable or even widely available. This does not necessarily mean it will always be so, but in such a case, investing in such a project might simply involve noticing social trends, thereby becoming a speculator in the project. A speculative approach can offer the chance to make a profit, so this article is not intended to criticize this type of business model. Addressing this topic is solely to conclude that it may affect the price, which may not reflect the practical application of the cryptocurrency.

For the sake of a thought experiment, let's simplify and completely ignore speculation as if it never occurred. In this hypothetical and perhaps unrealistic situation, each project is not inflated by the value of future demand faith, but solely by the valuation of the features and privileges associated with the cryptocurrency. In such a case, new projects can be treated like startups—they may want to create the best possible impression on us, possibly making grand promises, while the reality may differ from the vision sold to potential observers.

Nevertheless, returning to the topic of speculation, various actions, including marketing, can initiate the demand for cryptocurrency through both unaware buyers and those who know they can profit from it, similar to the "tulip mania" phenomenon in 17th-century Holland. Approaching it like startups will, in this case, during questioning, indicate that the project is overpriced and that the price is inadequate, making it seem unprofitable to participate in this project's markets. However, this may not always be the case. It may turn out that if we are willing to overpay for cryptocurrencies relative to practical approach, there is a chance that someone else will overpay even more, allowing us to gain profit. This would, however, be more of a "game," which may end in either success or failure for us. By valuing projects based on their practicality and application, we also have the possibility that our cryptocurrency, which we bought, will undergo speculative inflation. This works to our advantage as holders because we do not participate in the "game" and yet are its beneficiaries, as we did not overpay within the game but purchased the cryptocurrency using an evaluation model. If it had been part of the "game" at that time, it would not have been worth buying in our opinion.