After reviewing the attributes of Bitcoin, I have basically focused most of my energy on products within the crypto ecosystem that can provide services and value. This is because the future direction of Bitcoin largely depends not on Bitcoin itself, but on those products in the crypto ecosystem that can offer real services and value.

If more and more users find the services and value they need within the crypto ecosystem, then the price of Bitcoin will naturally rise. Conversely, if the real services and value that the crypto ecosystem can provide diminish, then no amount of shouting about "digital gold" or "store of value" will be effective.

When it comes to providing real services and value, the most important aspect in the entire crypto ecosystem, in my view, is layer one public chains. They directly provide services and value to the entire ecosystem. The services and value they offer will ultimately determine the value of their native tokens.

Layer one public chains are tangible products, platforms, and technologies, but in reality, their operations behind the scenes are similar to traditional companies in many ways. What drives public chains forward are their teams, culture, and community.

Therefore, evaluating the real value of a public chain token is essentially about assessing the team, culture, and community of the public chain. This is akin to evaluating the value of a stock by assessing the company behind it.

To determine whether a company's stock is worth buying, Buffett summarized three key factors: business model, corporate culture, and transaction price. Among these, the business model is what Buffett values the most.

Duan Yongping summarized the business model in very simple terms: it is the way a company makes money.

A good company must have a good business model/money-making method, so what kind of money-making method is considered good?

Duan Yongping also provided a straightforward explanation (essentially):

There must be a strong moat. A good moat means having differentiation. And differentiation is the service or value that customers need but other companies/products cannot provide.

The differentiation of Bitcoin from all other digital currencies is the most obvious: it is the first decentralized asset realized through blockchain technology. This unique historical value is destined to be its greatest moat, which cannot be replaced by other digital assets.

Compared to Bitcoin, the fundamental differentiation of Ethereum lies in its provision of Turing-complete smart contract functionality, which allows it to handle on-chain logic and behaviors that Bitcoin cannot. The subsequent rise of a series of applications in the crypto ecosystem has greatly benefited from this. This is also the reason why Ethereum was able to rise later.

Not only Ethereum, but all layer one blockchains that have implemented smart contract virtual machines have this fundamental differentiation compared to Bitcoin.

The Bitcoin inscription technology that emerged in 2023 and the subsequent Bitcoin layer two scaling that it spawned were able to create a whirlwind in the entire ecosystem during that time. The fundamental reason is that if this technological path truly succeeded, the differentiation between other smart contract layer one public chains and Bitcoin would be quickly erased. At that point, the status established by other smart contract public chains would be precarious, or at least they would feel a significant threat.

At that time, the effects generated by Bitcoin inscription technology and layer two scaling were not only fermenting within the circle but had already begun to reach outside. Some tech bloggers I follow, who do not specialize in the crypto ecosystem, were saying during that time: Ethereum is done because Bitcoin can now also run smart contracts and issue tokens.

Whether their understanding of "Bitcoin can now also run smart contracts and issue tokens" is accurate is another matter, but their understanding of differentiation is quite precise.

However, later practices and the test of time have basically proven that the Bitcoin ecosystem's attempt in this regard has temporarily come to a halt. This pause has preserved the fundamental differentiation between other smart contract layer one public chains and Bitcoin.

Now, the thought process of considering/searching for differentiation has returned to the layer one public chain track itself.

In other words, when we think about the differentiation of a layer one smart contract public chain, the key question is to consider what services or value this public chain can provide that users definitely need but other public chains find it difficult or even impossible to provide?

Using this method of thinking, we find that it seems not easy to identify such obvious differentiation. So we can use reverse thinking to consider:

• Are the most prominent and claimed characteristics and advantages of this public chain unique to it?

• Even if these characteristics and advantages currently belong only to this public chain, with technological advancements and developments, is it possible that other later entrants or existing competitors could also achieve these characteristics and advantages in the future?

Additionally, while contemplating this issue, I think two statements made by Jobs and Duan Yongping are worth our careful consideration.

Jobs once expressed a similar viewpoint: users do not know what they need until you present something to them, and then they realize they need it.

Duan Yongping said (essentially): sometimes, the differentiated aspects only become apparent when something significant happens.

By approaching the problem from these angles, I believe it becomes much simpler to think through, and many issues can be seen more clearly.

Once we clarify this issue, we will have more confidence and assurance in the layer one public chains we are optimistic about, and we won't need to worry about the noise in the market.

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