Rewritten Article:
Title: The Changing Dynamics of Crypto Investment: Pumpmental vs. Fundamental
Introduction:
In the crypto market, there is always a legend circulating about someone who has made significant returns by simply buying and waiting. However, when it comes to personal practice, being a diamond hand investor requires a high level of personal willpower. People often say, “The rewards of waiting are fruitful.” But the reality is often different. While waiting, they see others making substantial gains, only to find that all they have left in the end is a handful of dust.
Value Coins and the Illusion of Long-Term Holding:
Compared to the relatively stable Bitcoin (BTC), more people choose to hold a variety of “value coins,” hoping that their holdings of these altcoins will one day be recognized and yield returns far exceeding the overall market. However, recently, prominent DeFi OG Ignas (@DefiIgnas) expressed through a tweet that it is not reliable to choose altcoins for long-term holding based solely on their fundamentals.
Lack of Belief in Fundamental Investing:
Ignas, who has solid fundamental projects in his portfolio, used the example of Brave browser and its $BAT token to illustrate his point. Despite Brave having around 73 million active users and raising $40 million in funding in 2016 and 2017, the price of $BAT has not seen significant growth. Ignas admitted that he believed in the vision of $BAT and even had it as his largest altcoin holding, but the price performance of $BAT taught him that success in product development does not necessarily translate into excellent token performance.
Attention is the New Fundamental:
Ignas’s tweet sparked an interesting discussion in the comments section. Some suggested that the underperformance of $BAT could be due to a lack of focus on marketing by the team. Ignas emphasized that attention is everything in the crypto world, and teams should consider hiring Key Opinion Leaders (KOLs) to promote their projects and build a stronger community to enhance market awareness.
The Rise of Memecoins and the Divergence of Investment Preferences:
The popularity of memecoins, such as MEME, is a testament to the changing dynamics of the crypto market. The entertainment-driven, speculative nature of memecoins attracts retail investors, while institutional investors tend to focus on regulated, utility-based assets like BTC/ETH ETFs and Real World Asset (RWA) tokens. Despite their divergent preferences, both retail and institutional investors ultimately seek returns.
The Importance of Attention:
The success of memecoins like Phantom, driven by retail investors, shows that attention is key. MEME culture, with its attributes of freedom, randomness, and chaos, entices retail investors to pay for the added value it brings. Even institutions, initially skeptical of cryptocurrencies, have been drawn to the market, recognizing its value and potential. Attention has become the driving force behind the crypto market’s transformation.
The Need for a Balanced Approach:
Investors should consider embracing both the memetic and fundamental aspects of the market. Jupiter, a project that originated in the memecoin space, has expanded to create an all-in-one market, the GUM Alliance, which includes memecoins, RWAs, stocks, and forex. By catering to various assets, Jupiter demonstrates that a focus on attention does not exclude fundamental considerations.
Conclusion:
The crypto market has evolved, and simple fundamental investing is no longer as effective. Lessons from history have shown that some fundamental investments have failed to outperform inflation, and even strong fundamental projects have gone to zero. The logic of market investment is changing, and fundamental investing is no longer politically correct. In a rapidly evolving information landscape, attention is the most valuable resource. The market’s driving force has shifted, and projects must capture attention to influence token prices. The importance of attention economics is increasingly evident, and the time for value discovery is running out. “Pumpmental > Fundamental” has become the consensus, and for retail investors who invest their hard-earned money, pumping is the best fundamental.