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Analyst Miles Deutscher recently revealed that retail investors are losing faith in new token launches with high valuations and poor airdrop execution, leading to a preference for buying tokens with better public market liquidity. The analyst said that recent projects have had lower valuations in the public market compared to their private market valuations, suggesting that the era of easy VC wins might be coming to an end.
In these times, how can one identify potential projects? The analyst answered and said that one can look for projects with a well-defined narrative and leadership in their sectors, such as real-world assets (RWA), artificial intelligence (AI), or gaming. A strong narrative is essential for market positioning.
Projects should have a clear differentiator. This could mean innovative technology, unique features, or significant improvements over existing products. Avoid investing in redundant projects, such as the tenth Layer Two launching in a month, unless they offer substantial advancements.
Look for tokens that offer additional utility beyond governance, such as buybacks, burns, and enticing staking rewards. These mechanisms can reduce circulating supply and enhance price appreciation, which in turn fosters community building.
A strong, engaged community often follows price appreciation. Community building can also be driven by valuing community input, embracing crypto culture, and being memeable rather than overly corporate.
He advised people to prefer tokens with low inflation. This can mean a high percentage of the token supply is already circulating, or the inflation rate is low during your trade window. Low inflation helps maintain price stability. For instance, tokens like Ono, with a very low float and minimal short-term inflation, have shown strong performance.
Ondo is cited as a successful example due to its extremely low circulating supply and minimal inflation, which has contributed to its recent price surge. He suggests that other projects might adopt a similar model, avoiding large initial airdrops to control supply pressure.