Why doesn't it have long-term value

Transition is no longer a strategy, but a business model itself。

submitted by: rose

Photo by Luffy, Foresight News

Most of the encryption money founders I know have now undergone three transformations。

The group that built the NFT platform in 2021 turned to the DeFi Gains Project in 2022, followed the wind as AI agents in 2023 to 2024, and are now busy chasing the current hot track (perhaps predicting markets。

Their transformation is in itself right, and in many ways it is a choice that is in keeping with the rules of the game. The problem, however, is that the rules of the game are structurally determined and that no permanentist construction can begin。

18-month product cycle

In the past few months, there has been an influx of capital from the rise of narratives, and a six- to nine-month investment in wind and wind transformation。

THIS CYCLE, WHICH USED TO BE THREE TO FOUR YEARS (THE ICO ERA), WAS REDUCED TO TWO YEARS, AND NOW ONLY 18 MONTHS IF YOU ARE LUCKY。

In the second quarter of 2025, the size of the investments in encrypted currency risk dropped by nearly 60 per cent a quarter, and the time and funding available to the founders became more tight before the next trend forced them to change again。

The key question is:18 months is not enough to build anything meaningfulI don't know. Real infrastructure takes at least three to five years to build, and real product market matching requires several years of iterative optimization, rather than a few short quarters。

But if you're still stuck with last year's narrative, it'll be an "ineffectual asset". Investors are avoiding you, users are losing, and some will even force you to follow the current hot track. And your team members will start interviewing projects that have just been funded by the current hot talk。

Sinking costs are a survival mechanism

The traditional business proposal is not to fall into the fallout of the costs of sinking, but to transform in a timely manner if something does not work。

The encryption industry pushed this to extremes and turned it into maximizing the costs of sinking. Nobody's going to stick around long enough to verify that it's actually working。

A SWOT turns around, a slowdown in user growth turns around, and financing turns around。

Each of the founders would make such a trade-off:

• Continued development of the current product may take 2-3 years to see results and, with good luck, perhaps another round
• The narrative of the transition is quick to get financing, make book returns and walk away until no one finds the project unworkable。

Most of the time, the latter is a better choice。

It's a half-way dilemma

Few encrypted money projects actually achieve the stated development goals. Most of the projects are in a "closing" state, and there's always only one function to match the product market。

But they can never really be done, because when they are halfway through, narratives change. All of a sudden, the DeFi agreement that you're still finishing becomes meaningless because everyone's talking about AI agents。

The market will punish "finished" this:Completed products have clear limitations, while the products that are about to be completed have unlimited imagination。

Capital chases attention, not results

The actual financing is clear:

• New narrative + No products: US$ 50 million
• Established narratives of mature products: hard to raise $5 million
• Old narrative + has products + real users: totally unfunded。

Investment is not product, but attention。And attention always goes to new narratives rather than old projects that have been completed. Most teams are now "maximizing narratives" and optimising for a mere financing story, with no regard for what is actually being built. Completion means self-imposed restrictions, while failure to complete retains all possibilities。

Team retention problem

your best developer receives twice as much pay from a hot narrative project; your market leader is being dug up by a new $100 million project。

You can't compete at all, because you decided six months ago to stick to the project at hand and to abandon the hot talk。

No one is willing to work on dry and stable projects, and they prefer projects that are disorderly, over-funded, that could collapse at any time, but that could achieve 10 times the return。

User attention is scarce

Encryption money users use your product simply because it's new enough, everyone's talking about it, or they have access to airdrops。

As soon as narrative moves, they leave, whether or not your product is better or whether or not you add the functionality they require。

You can't create sustainable products for "unsustainable users."。

I know some of the founders, who have made too many transformations and have long forgotten what they wanted to build。

To centralize the NFT platform, the DeFi polymer game infrastructure, the AI proxy market。Transition is no longer a strategy, but a business model itself。

Infrastructure paradox

Much of what really lasts in the encryption industry is born in the age when nobody cares about encrypted money。

WHEN BITCOIN WAS BORN, THERE WAS NO ONE TO LOOK AT, THERE WAS NO VOTE, THERE WAS NO CURRENCY TO ISSUE, THERE WAS NO ONE TO KNOW THAT SMART CONTRACTS WOULD BE WHAT THEY WERE。

Most of the things that are born in the chorus end up disappearing with the cycle, while what is built in the chorus is more likely to survive。

No one, however, would build in the margins because there was no financing, no attention and no exit from liquidity。

Why is the status quo so difficult to change

Incentives based on tokens provide flexible exit channels. As long as the founders and investors can quit before the product matures, they will do so。

Information is transmitted at a much faster rate than product construction. By the time you're finally done, everyone knows if it works. The core value proposition of the encryption industry is "quick action" requiring it to slow down, which is tantamount to removing it from its nature。

This means that if you spend three years building a product, someone else can replicate your ideas and spend three months putting out a simpler and better version, and then beat you。

So, where do we go from here

The encryption industry has difficulty building long-term value because it is structurally contrary to long-termist thinking。

You can be a principled founder: rejecting the wind, upholding the original vision and spending years, not months, grinding the product. But it is likely that you will eventually run out of funds, be forgotten, and be replaced by those who made three transformations during your release of the first edition。

Markets don't reward "finish" but "start" -- they start over and over again. Perhaps the real innovation in the encryption industry is not technology per se; perhaps the real innovation is finding a way to extract maximum value from the lowest degree of completion. And perhaps the transformation itself is its product。