Author: Rain in the Rain Source: substack
I am most impressed by "Inscription" and "Memecoin".
The emergence of these two hypes is driven by "demand" (even if these demands are just pseudo-demand or unsustainable demand) or "Ponzi" (high returns and high capital efficiency, derived from greed).
A commonplace topic: The hype about Alt-Layer1 in the last cycle came from users' demand for high-performance and low-cost public chains. The emergence of DeFi Summer (Ponzi) has driven users' demand for Ethereum block space, while Ethereum's low performance and high fees (demand created) have pushed a large number of users to its competitors.
"Demand" and "Ponzi" interact with each other and are limited by cycles.
For example, the hype of DeFi and Alt-Layer1 is the result of the interaction between "demand" and "Ponzi". GameFi is an upgraded version of DeFi, packaging liquidity mining into games and selling it to on-chain users. But in the end, GameFi did not create new demand (perhaps only game guilds are the only track that benefited from GameFi hype), and was limited by the hasty end of the cycle. If GameFi successfully creates new demand and a solution emerges at the same time, the bull market may last a few more months.
@cobie calls this narrative hype a metagame.
During this cycle, we also saw a lot of metagames, like the inscription and memecoin hype I mentioned above (and some fleeting metagames, such as modularization, Cancun upgrade/Layer2).
The hype of inscriptions and memecoin is the most popular Ponzi gameplay in this cycle. In short, these Ponzi are constantly launching new assets, and then using expectations to attract subsequent buyers.
The hype against inscriptions and memecoin is not groundless.
I personally think that the hype behind inscriptions is most likely driven by miners. On the eve of halving, miners need to promote the growth of Bitcoin chain activities to increase mining profits. In other words, in the future, as halving continues, miners need to subsidize mining expenses by promoting the development of the Bitcoin ecosystem. It is foreseeable that a large number of new assets and new gameplay will emerge in the Bitcoin ecosystem in the future, and new wealth opportunities will also emerge.
And what about memecoin?
A mainstream view is that the reason why the market is keen on hyping memecoin is that market participants hate and resist low-circulation, high-FDV VC coins.
I would like to add that the memecoin craze is more like the result of the combined effect of "time, place, and people": If Solana wants to revive, it needs the wealth effect on the chain. Users enter the Solana ecosystem, and Solana can promote other products (DeFi, mobile phones, Depin) to users. Memecoin is a trigger.
The resistance movement against VC coins has pushed the memecoin hype wave to a new height.
The Memecoin hype has brought about the demand for trading memecoin and issuing memecoin. Therefore, we can see the popularity of Telegram Trading Bot and Memecoin Launchpad.
All of the above is actually a simple review of the past cycle. After looking back, let me briefly talk to you about some of my predictions for the future metagame.
The basis of the prediction is to focus on the mainstream difficulties of the industry and the mainstream views of the market.
1. Alt Layer1 (market hype demand)
The discussion about Alt Layer1 mainly focuses on the topic of "Solana successor". On social media, I have seen many opinions that $SUI will be the next Solana. Although this kind of view is a bit crooked ($SUI has conducted a large number of OTC transactions? I am not sure about the details, but the market rumors are like this), $SUI does have the potential to become the next generation of Alt Layer1.
But my question is, is there a problem with Solana?
For now, there are no major problems (similar to Ethereum in the last cycle). Although Solana occasionally has some downtime, it does not affect user use. Solana's current dilemma is that the market is tired of the hype of Solana memecoin - there is no hype expectation without sufficient wealth effect on the chain. Pumpdotfun has promoted this situation to a certain extent.
There is no sign that $SUI can take over Solana.
I personally believe that the core of a chain is developers, and the ecosystem is the basis for attracting and retaining users. Solana has captured a large number of developers in the last cycle, and has left behind a lot of on-chain infrastructure, which is the basis of its success, but $SUI has not yet.
$SUI's competitors include Fantom, $SEI and other chains. $SEI's fundamental data has increased a lot recently (the expectation of airdrops drives data growth), which may provide fundamental support for possible unlocking and pulling in the future. Fantom also provides airdrops for users of the Sonic chain. Although they are all following the old path of predecessors, they are indeed effective in the short term.
Let's talk about other chains.
Avalanche's direction is enterprise-level adoption (subnets) and RWA. The market's expectations for RWA will decrease with the start of interest rate cuts, and we have to question enterprise-level adoption here. Avalanche's hype does not lie in the number of users, but in market attention. The means to attract market attention can be to frequently release positive news to raise market expectations.
An important difference between Berachain and other chains is that PoL is very obvious to users. It will promote users to play games with validators and project parties at various levels, while the consensus mechanism innovations of other chains are imperceptible to users. Users may only think that this is another faster and cheaper Layer1. This is also a fun point of Berachain. In addition, Berachain's community is doing well, so it is foreseeable that after the Berachain mainnet is launched, the topic and market attention will not be less, and PA will be affected by this.
2. Liquidity fragmentation (real market demand)
In my opinion, the solutions to liquidity fragmentation are nothing more than the following:
No matter what the abstraction is, the simple understanding is: Create a front end, and users only need to use the products of each chain seamlessly on this front end to realize their intentions. The launch of Uniswap v4 may be an opportunity for this kind of infrastructure hype. But the real large-scale hype may still have to wait until the large-scale entry of liquidity & users (mid-to-late bull market). To put it bluntly, the chain is not active enough, and the number of users determines the scale of demand.
And shared liquidity is literally what it means, putting all the liquidity together and providing liquidity for other products in a unified way. But shared liquidity cannot solve the problem of user experience. The demand for such products is often reflected in the B-end, not the C-end. I personally find it difficult to see the possibility of hype for such tracks - unless the fundamental data is good + the basic market cognition is built + the CT large-scale shouting for a certain project.
I won’t talk about cross-chain, many people have already talked about it.
3. Buy BTC and hold BTC (real market demand)
In this cycle, we may see a trend shift from "institutional buy + hold" to "national buy + hold". Then trading venues may become more important as such demand is driven. Related targets include $BNB $COIN, etc.
Also, we have seen more countries holding BTC through mining, and there is a high probability that speculation on energy-related targets will also occur (unpredictable time).
Fourth, AI (market hype demand)
We have seen the hype about AI many times. Including OpenAI's continuous innovation and Nvidia's financial reports, which have given the market sufficient hype expectations. I personally think that the key to AI hype lies in the trading venue. The potential of AI targets traded in venues with sufficient liquidity is greater than that of other targets. The quality of the trading venue also depends on the background of the corresponding target.
Five, New Ponzi
The gameplay of the new Ponzi is difficult to predict.
Currently, the market's attention is still focused on memecoin and BTC ecology. BTC ecology is strong, while memecoin is relatively weak. In this cycle, everyone is keen on hyping newly issued assets, but Ponzi like DeFi and GameFi did not appear. One day, the market will get tired of the hype of new assets and focus on projects with real income, such as $BANANA, or projects with full circulation + strong fundamentals, such as $UNI $LDO.
Sixth, Finally
Metagame is a concept I proposed in 21 years based on cobie. As for the hype that may appear in the future, I am also in the dark. Before the signs of it appear, no one can clearly predict which track the next narrative opportunity will be in.
JinseFinance
Cointelegraph