Unpopular opinion: Memecoins is bullish for utility tokens.

And now is a great time to invest in private-public (ICO) rounds.

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Memecoins is a protest vote against low-float, high FDV tokens. You probably already know that.

You also know that degens are tired of high FDV launches that offer no upside for new buyers and are then dumped on by VCs.

Fortunately, the market heals itself.

By choosing to buy memecoins instead of VC tokens, the value of these VC tokens only dumped for a while now.

However, the valuations of VC tokens have declined not only for new launches but also in private markets.

On @echodotxyz, I've invested in 7 projects with an average valuation of just $32M.

This is much lower compared to recent TGEs, which raised (and launched) at valuations in the 100s of millions or even billions USD in FDV.

So thanks to memecoins, valuations for utility tokens are getting attractive again.

Yet memecoins are still not going anywhere. At least for this cycle.

Here's why:

First, the average funding amount offered on Echo is around $262k (from my 7 deals). Not many can get in.

Secondly, these tokens have a cliff of at least 1 year with 3 to 4 years for full unlocks.

Third, you need KYC and US citizens are not allowed.

Finally, the regulatory environment will take time to change. Might be too late for this cycle.

So, private-public rounds are relatively exclusive and long lock ups mean that we won't know the real ROI until at least Q4 2025.

When unlocks for new tokens hit the market in a year or so (possibly at the top of the cycle) the valuations for everything (memecoins and VC tokens) will be inflated.

You'll see the prices of memecoins going up in real time, enticing FOMO to buy.

Yet ROI for the currently underway ICOs won't become obvious until unlocks start in Q4, 2025.

That's why until then, memecoins are likely to dominate mindshare, especially since recently launched VC tokens will have huge unlocks throughout the bull run.

Obviously, not all ICOs will do great. But also not all memecoins will pump! Far from it.

Maybe 1 or 2 out of 10 will do a 20x or more. From $32M to $640M is quite possible at the peak of a bull run.

So, we'll likely see the success stories of high ROI VC tokens in 2024 that will entice a new wave of fundraising for VC tokens.

But again, the valuations for these VC tokens will be high, reflecting the general crypto market!

When degens invest in new ICOs in Q4 2025 and these tokens launch two or three years later during a bear run, we'll scream that VC tokens are a scam.

And then a circle repeats.

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