- Crypto enthusiast sheds light on crypto’s biggest problem.
- This sparks an insightful community debate.
- Clear regulations could create more opportunities in the space.
As the prices of pioneer crypto and altcoin assets, Bitcoin and Ethereum, continue to struggle to reclaim strong support levels, analysts move on to find other bullish indicators and signals that can prove a bullish turn is coming. Amid the quiet, one crypt enthusiast shed light on crypto’s biggest problem, which he believes is one that the community never talks about, sparking a community debate.
Crypto Enthusiast Sheds Light on Crypto’s Biggest Problem
The crypto market is still relatively new compared to other financial markets. Despite Bitcoin’s debut being over a year ago, the market lacks resources for the general public, its ways being different from most traditional markets means the general public is yet to involve themselves in this sector, not to mention the lack of regulations and clarity. Thus, there may still be much that needs to be adjusted before the crypto market can become its best version.
According to the well-known and community-recognised crypto enthusiast in the post above, the crypto space has a huge problem, and it’s one almost never talked about. This post explores how crypto project founders make hundreds of millions (or billions) from tokens they created before their products prove real utility or adoption. After all, in traditional markets, value follows performance.
Initially, founders got rich because their company builds something people use, generating profit, and growing over time. In crypto, it’s often reversed. Tokens launch first, valuations skyrocket on speculation, and founders cash out long before the product is battle-tested or the network achieves meaningful usage. The result is a strange inversion of incentives – enormous wealth built on potential rather than proof.
What’s more, because tokens trade globally, that value is extracted from retail participants who are effectively subsidizing the experiment. So, when billion-dollar fortunes are realized before success is earned, it raises a fundamental question: If the future value is still undetermined, why are the rewards already realized? That disconnect is what keeps so many people skeptical of token models.
Community Debate Sparked
Responses to the post disagree, one says that the problem is easily solved with lack of vesting and lockups. and vesting for L1s and L2s being up to three years. After that, monthly vesting over 4 years. Stating that seven years is a reasonable time frame, the system can theoretically be accelerated if actual usage milestones are hit. Lastly, he mentions that DeFi and dApps are different and should be handled on a case-by-case basis.
