🌟 Observation of the Coin Industry on March 30, 2025 🌟 🦈 After returning from Consensus in Hong Kong, I met some friends in China one after another, and familiar laughter still echoed in my ears. My old friends are still active, KOL、Agency、 Market makers and traders - the people have not dispersed, the market has not collapsed, but what has changed is the "qi" of this market. This is not a bull market, nor is it a bear market. It is not the familiar market dominated by greed or fear, but an indescribable "alienation" - an industry atmosphere that the old leeks have never experienced before, making people feel like they are in a different world. In this era, there is only one business left in the cryptocurrency industry: selling coins. 🦈 Three pillars: creation, discovery, and circulation Roughly speaking, the cryptocurrency industry has always relied on three wheels to operate: Value creation - Bitcoin, Ethereum, stablecoins, Layer2, DePIN, AI agents, etc. meet user needs through technological innovation and create practical value. Value discovery - VC investment, transaction pricing, capturing potential assets, realizing price discovery through market mechanisms, and promoting industry development. Value circulation - market makers Agency、 Media, KOLs, and other entities build a sales channel for the coin, assisting the project in reaching retail investors and completing the first to second level circulation. These three should be a market ecology where gears are interlocked and complement each other. But now, what we see is: The first two wither, while the third prospers. The project no longer pursues users and products, and VC no longer studies trends and tracks. The entire market is left with only one voice shouting, "How should we sell coins 🦈 Selling Coin Economics and Resource Club A reasonable and healthy market should be inseparable from three aspects: the project party should make good products, meet user needs, obtain profits, and capital market premiums; The first and second tier institutions provide capital allocation for the project party, intervening during low periods and exiting during peak periods for profit; The sales channels established by the circulation party also provide higher capital efficiency for the capital market. But currently, in the cryptocurrency circle, there are no project parties or VCs discussing which areas have opportunities for innovation, what kind of products can be made, or what kind of needs can be met. Even in the second half of 2024, when VC coins are widely counterfeited, there is still local industry heat such as AI agents that can stimulate the enthusiasm of entrepreneurs. Secondary institutions are also generally flat, with altcoins reaching their peak when they go online, and the liquidity of meme coins is almost depleted. The persistence of BSC is still lacking. In this market situation, there are only three types of active institutions in the industry: MM market makers, agencies, and intermediaries. The topics of discussion are all about how to generate good data or establish relationships with major exchanges, how agencies can promote and attract buying orders, and how proactive market makers can cooperate with buying communities to dump more trading volume. The market participants are extremely homogeneous and are trying their best to squeeze out the increasingly scarce stock funds in the cryptocurrency circle. In this way, the top resource providers (top projects, large exchanges and their coin listing departments, resource strong MM and agencies) have formed an unbreakable community of interests. The blood of the cryptocurrency circle flows from the LP end to VC, from VC to the top projects, while the other end is infiltrated by the capillaries of retail investors in the secondary market, feeding the parasitic organizations of these interest communities, and then grows larger and larger. 🦈 The disappearance of entrepreneurs After the bankruptcy of FTX in 2022, there was a dark moment in the cryptocurrency industry when Bitcoin fell to 18000 and many imitators fell silent. But unlike at this moment, a large amount of funds in the cryptocurrency industry are deposited in the hands of venture capitalists and secondary funds/large investors. These funds have a hematopoietic function, and venture capitalists will invest in entrepreneurial projects. Entrepreneurs can generate positive externalities, create value, and attract capital to enter the market; At this moment, a large amount of funds are being drained by intermediaries, and entrepreneurs and project parties only seek to earn the price difference after entering the market, becoming intermediaries between VC and the secondary market, without having to create value, only creating "shell" stories. Starting from traditional business logic, if downstream distribution channels want to eat up most of the costs, it is necessary to cut off upstream R&D and operating expenses. The project team simply gave up on making the product and used all the funds to connect the promotion and listing process. After all, there are still many opportunities for promotion without products and users. Moreover, promotion can now be packaged as a "meme" driver, with less investment in products and technology, and more funds available for listing and selling. The innovation path of the cryptocurrency circle has become: Tell a good story → quickly package → find a relationship partner → cash out and run away Product? User? Value? That is the self inspiration of romanticists. 🦈 Pumping water is fate On the surface, the project team seems to be spending money on the exchange and cryptocurrency prices. Hello, hello, everyone. The fund has been withdrawn, and there is also room for secondary retail investors to maneuver in the game. Intermediaries are making a lot of money from the withdrawals. But in the long run, the loss of positive externalities results in only intermediaries becoming larger and larger, forming a monopoly and increasing the proportion of withdrawals. The upstream project party has reduced production and research costs, and the pressure of regulation and pumping has led to a serious asymmetry in the risk return ratio, forcing them to withdraw. Downstream retail investors' PVP is becoming increasingly severe, with "every time they take over the market" and a large number of them withdrawing from the market after losing their profit making effect; Essentially, intermediaries, whether they are exchanges MM、 Agency and community are both service providers, and service providers do not directly create value or positive externalities. When service providers and pump providers become the largest interest groups in the market, the entire market is like a cancer patient with a tumor. The ultimate outcome is that cancer cells will grow fatter and richer, and after the nutrients are drained by the host, they will wither and die. 🦈 The Power of Cycles and Post Disaster Reconstruction The cryptocurrency market is ultimately a cyclical market. Optimists believe that after this low point of liquidity drying up, there will one day be a true 'spring of values'. Technological innovation, new use scenarios, and new business models will re stimulate the enthusiasm for innovation. Innovation will never die, and the foam will end. If there is a faint light and it is a lighthouse. Pessimists believe that the foam has not yet burst, and the currency circle still has to go through a deeper "avalanche shuffle". Only when the pump has no money to pump, and the market pattern dominated by intermediaries collapses, can real reconstruction be ushered in. In between, practitioners have to go through a chaotic and muddy stage: questioning, internal friction, fatigue, and doubting life. But this is the essence of the market - cycle is destiny, and foam is also the prelude. The future may be bright, but the tunnel leading to it will be long.