Blockworks head of research Ryan Connor believes that we are at a turning point. “crossroads” Learn the basics of cryptography.
“It’s because the marginal investor coming into crypto as a result of legalizing crypto in the United States is going to be a traditional financial professional, not a degen,” He told me.
The answer can be reduced to the number of participants on the market or the people who have control over the capital. These two factors lead to the exact same result: People who are looking for tokens with a fundamental value.
“A lot of people in crypto still believe the primary driver of token price is ‘vibes.’ There’s ample evidence over the past, let’s say 18 months, that that’s increasingly not true,” he said. That doesn’t mean that vibe trading isn’t a thing — and probably will still linger for a while yet — but those will remain in smaller pockets of the market, like memecoins.
You can use scenarios to help you. “silly” The tokens’ soaring, then their crashing opens up the possibility that fundamentals can play a larger role as crypto matures.
“Most token projects are early-stage, and because there’s some opacity around governance models, we tend to just look at the top line first. As a general rule in TradFi, the earlier stage the project, the more you care about the top-line fundamentals as opposed to the bottom-line fundamentals. If you’re a high-growth tech company, you’re looking at sales growth, you’re looking at the [average revenue per user], and rate of change on those metrics,” Connor said.
Other factors that you should consider depending on the type of project are earnings, cashflow and dividend yields. Most of the TradFi measures carried over from TradFi will be similar to what is seen in high-growth technology firms.
Currently, however, the revenue stream is not a priority. “probably the most important thing today,” You can then choose to use other metrics depending on what token you are using.
It’s a fact that there will always be room for a certain amount of vibes, but the addition of metrics for monitoring a project’s success only elevates crypto.
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