The two sides of the cryptocurrency economy: “useless speculation” and “practical innovation” coexist

Written by: Ryan Watkins, co -founder of Synccy Capital and the former analyst in Messari

Collected by: Yangz, Techub News

Critics are often cited the financial non -extent in the encryption economy as evidence that this economic system will eventually collapse under the weight of its excesses. However, under the speculative activities that feed this doubt, we also see some of the young “winners” who are constantly growing over time. In this article, we will explore the contradiction between “non -benefit” and “benefit” of the encryption economy, and we make it clear that they are in fact two aspects of the same currency.

“It was the best time, it was the worst time; it was the era of wisdom, it was the era of foolishness; it was the era of belief, it was the era of the slit, it was the season of light, was the dark season; ——- The story of two cities By Charles Dickens

Critics are often used Financial nihilism In the encryption economy as evidence of uselessness. Although Bitcoin has launched 16 years ago and Ethereum 9 years ago, there are still a few prevailing cases of use that can show its indispensable benefit.

Whenever we hear stories about emerging market users who protect their savings from local inflation through Stablecoins, there are always more users in advanced markets that offer their savings on various mines.

Stablecoins is both liberation and destruction. Blockchain is a large and giant tie. The encryption economy is the future of the global financial system and the greatest illusion in the history of mankind.

These conflicting opinions reveal a high level of risk, because this technology has the ability to change the world or self -destruction due to its excessive extremism. For many, this contradiction generates doubts, which drives the question, “What does all this mean?” Doubts have pushed whether it makes sense to maintain long -term basic opinions on non -bitcoin assets in the encryption economy.

However, this contradiction between “lack of benefit” and “the utility” is not a defect but a feature, as it offers the growing growth pain of the revolutionary capabilities of Blockchain.

Democratic wealth in the digital age

In a world where there is an increasingly clear nations, Blockchain technology has the ability to reach wealth to billions of dollars. To understand this, the concept must first be understood that “Blockchain is a new type of institution”, allowing users to deal with and Running Contractual relationships without mediators. Blockchain achieves this through the national -guaranteed national property system of encryption technology, allowing anyone to verify transactions. It is a hidden and strong tool to create a fair economic competitive environment.

Blockchain relies on cloud processes, as his only material presence was thousands of computers distributed all over the world, whose integrity is maintained collectively. These computers create The original internet The market infrastructure, which is the best mechanism so far to achieve the “ideal information” needed to customize effective resources according to Economic theory.

The property rights index; Data source: Global Economy, International Monetary Fund

Ronald Cass’s leading paper, “The Nature of the Company”, which was published in 1937, explains better the importance of this Changing. Coase argued that companies are present because the costs of searching for information, negotiating agreements, and imposing contracts in the market exceed the efficiency of external sources.

Blockchain mainly changes this position. By enabling automatic implementation through encryption technology, Blockchain makes information accessible globally and reduces dependence on brokers, which greatly reduces transactions costs, especially when combined with assistance techniques in the Internet such as search engines and economic platforms. With the low costs of transactions, the demand for large hierarchical companies decreases, paving the way for the Blockchain global market structure. This structure can increase economic production, enhance market efficiency, and lay the basis for new markets completely.

The largest “companies” on the series through revenues and gas consumption in 2024; Data source: Defillalama, Artemis, Ledger Top

The encryption economy has already shown these advantages. Stablecoins has facilitated economic growth and financial integration by providing cheap global users, trusted currency; Global stock exchanges and lending platforms created more efficient markets and access to capital markets according to; Debine He created completely new markets, allowing users to coordinate different material and digital resources. The operational efficiency of all these cases of use is very high, with the presence of profit margins similar to software, while Blockchain automatically deals with most infrastructure and settlement activities in the back interface. Large financial institutions and companies are slowly aware of these capabilities, either launching them either products Directly on Blockchain or Blockchain -based projects inside The rear infrastructure of current products.

So why still some still have a skeptical view of the encryption economy?

The interference of benefit and the uselessness

The creation of decentralized infrastructure for trading and the implementation of contracts inevitably leads to an unrestricted experience. Given that Blockchain’s potential user base includes billions of Internet users all over the world, the momentum of this experience is exceptionally strong. Even the leaders of different countries Release Their private currencies. The attractiveness of opportunities prompts the rapid spread of new assets and financial protocols, which includes both transformational innovations and frank fraud.

While these attempts may seem reckless, they are not very different from the situation during Dot-Com bubble. At that time, many companies were announced with more than one field name. On the contrary, the encryption economy infused this dynamic to the extreme, providing anyone to access the capital markets on the Internet. This created an unprecedented stage of innovation and speculation, which ultimately faster discovery and adoption. After all, before the trillion dollars enter the future value, the Blockchain space will attract speculation and provide a stress test that affects the need for the system.

“Winners” emerging and unifying the market share; Data source: Defillalama, Artemis, Taken Terminal

However, of all speculative activities, a few “winners” began to appear. Many projects lead speculative activities in the capital market, occupy higher sites and achieve the growth of the compound behind the scenes. These “winners” Nadron “group” are working to integrate the market share, expand their capabilities, and serve increasingly non -sugar use cases over time. These projects will eventually provide columns to mature and expand the encryption economy worldwide.

Will parallel tracks approach?

In the expected future, Cyncracy believes that the best way to clarify the basic arguments for the encryption economy is to find strong assets and the ability to capture the inherent speculation momentum of the online capital markets. This is not a deep statement, as in practice, simply means embracing the growing projects that people already use. At the present time, this also means continuing for a long time in trading volume, such as liquefying speculation activities on the chain directly through the source of assets or market platforms (such as stock exchanges), or investing in basic infrastructure, such as L1S. These speculative activities are not only in L1S, but also provide flexible evaluation frameworks, as they are often priced as currency -like assets.

In fact, going for a long time on speculation activities through infrastructure (rapidly growing projects that people already use) have been a common matter among many of the biggest winners of this course. Solana offers a first -class performance, making the commercial experience on the chain similar to traditional retail trading platforms (such as Robinhood); Phantom creates an easy -to -use experience, with a special focus on mobile applications, allowing users to speculate at any time and anywhere in unprecedented ways; Pump.fun presses the costs, energy and resources needed to launch new symbols; Hyperlequid gives merchants on the chain a central feeling of exchange but at a lower cost with fewer barriers and restrictions; Virtual and AI16Z (Eliza) allow anyone to launch artificial intelligence agents with associated and conservative symbols; Telegram buds and tools of discovering the distinctive symbol (such as Photon and Dexscreener) have brought at dawn to the economy in the chain, making it available to easily access them from familiar applications. Such examples are many.

The encryption economy is witnessing compound growth; Data source: Devilia, Artemis

In the end, we will go beyond this model to attract excessive attention and traffic through speculative projects, especially since more institutional investors enter this asset category. Meanwhile, there are many projects in Defi and DePin that are not very speculative but have promising horizons, rising steadily along “The Mail of Enlightenment” (The fourth stage of the Gartner technology ripening curve: the advantages of technology begin to become clear and understand it on a larger scale). These projects have already shown early signs to suit the product market and basic improvement. While these assets may take time to achieve evaluation growth, they also need a clear organizational framework to push them to the main current. Although some sectors (such as Stablecoins) paved the way for the industry and entered the confidence of the publication stage in its life cycle, given the current complexity of the economic activities of encryption, observers can still find many places that are opposite to interpret it according to their biases.

However, from the perspective of investment, our current goal is to develop the long -term participants and benefit from the double encoding economy, which increases increasingly serve the actual non -population use while harnessing speculative energy to push the financial transformation. These assets can achieve complex returns over time, instead of falling into the spiral of the “rotation game” like many of the assets that other narration driven into the encryption economy. These assets will eventually lead the world towards the transition on the series, as the speculative activities they lead will attract new users and provide a stress test that affects the need before the value of trillion dollars enter the Blockchain area in the coming years.

In fact, lack of benefit and benefit is, like both sides of the coin.