We need on-chain native stablecoins, we need to de-financialize, we need the next wave, and we do not want to live in a Web3 that sells traffic.
Author: YBB Capital Researcher Zeke
I. Bowing to Compliance
How did crypto move from niche to mainstream? Over the past decade, decentralized blockchain has provided a regulatory wilderness to the world. Satoshi Nakamoto's peer-to-peer electronic payment system did not succeed, but it opened the door to a parallel world. Laws, governments, and even society and religion cannot constrain this existence that spans countless nodes on the internet.
Being outside of regulation is almost the only factor driving the success of this industry. From the ICOs that began asset issuance to the countless subsequent variants, the DeFi ignited by UNI, and now the so-called super application stablecoins, all are built upon this factor. Eliminating the trivialities of TradFi has created the industry we see today.
However, it is interesting that after the failure to explore new continents during the Age of Exploration, people began to abandon sailing ships and return to the past. Perhaps it started with the BTC ETF or the moment Trump was elected; native crypto has entered an era of decline. The industry is beginning to seek compliance, to meet the needs of TradFi, and stablecoins, RWA, and payments are becoming the mainstream of industry development. Beyond that, we are left with pure asset issuance—a picture, a story, a string of CA is the only topic of conversation in daily life. "Dog chains" are no longer a derogatory term.
How did we get to this point? I have analyzed this in many articles over the past two years, but ultimately, blockchain currently lacks effective means to constrain various entities behind addresses from wrongdoing. We can only ensure that nodes are honest and that DeFi does not require intermediaries. Beyond that, we cannot prevent anything that may happen in this dark forest; many things inevitably lead to desolation. NFT, GameFi, and SocialFi are all heavily reliant on the entities behind the projects. Blockchain has excellent fundraising capabilities, but who will ensure that these project parties use the funds reasonably? And turn a story into a real project.
The vision of de-financialization cannot be solved merely by improving infrastructure performance. If these things cannot be done well on a centralized server, how can we expect them to be done well on-chain? We cannot implement proof of work on project parties; today, bowing to compliance may be the beginning of future de-financialization. This is indeed ironic but also helpless.
Crypto is indeed becoming a subset of the traditional. The discourse power of this ledger is beginning to be stripped away by the upper echelons. There are fewer and fewer bottom-up initiatives, and opportunities are being compressed. We are entering an era of on-chain hegemony.
II. Stablecoins
What is on-chain hegemony? I think it can be discussed from two aspects: one is stablecoins, and the other is the repetition of traditional internet stories.
First, regarding the former, today's stablecoins are basically dominated by fiat stablecoins and YBS stablecoins. Recently, a significant event occurred regarding fiat stablecoins: the passage of the "Genius Act." Here, I will briefly summarize the content of the act:
Definition and Issuance Restrictions: Defines "payment stablecoins" as digital assets used for payment or settlement, which must be fully backed 1:1 by US dollars or highly liquid assets (such as short-term government bonds).
Only licensed issuers (who must register and accept regulation) can legally issue stablecoins, and unauthorized individuals or entities are prohibited from issuing them.
Reserve and Transparency Requirements: Issuers must hold reserve assets equivalent to the stablecoins on a 1:1 basis (such as US dollars or high-quality liquid assets) to ensure stability and solvency.
Issuers are required to publicly disclose reserve status regularly, and those with a market capitalization exceeding $50 billion must undergo annual financial audits and comply with anti-money laundering (AML) and counter-terrorism financing (CFT) regulations.
Regulation and Compliance: Establishes a clear regulatory framework; stablecoins are not considered securities and are subject to banking regulation rather than SEC regulation.
A licensing process is established to regulate issuing institutions and enforce anti-money laundering, asset freezing, and destruction mechanisms.
Promoting Innovation and Financial Inclusion: Aims to promote the development of the stablecoin industry in the US through a clear legal framework, enhance financial inclusion, and maintain the dollar's dominant position in the digital economy.
Restricting Large Tech Companies: Prohibits large tech companies from issuing stablecoins without regulatory approval to prevent market monopolies.
The long-standing industry concern over Tether's collapse has finally become a thing of the past, and it is only a matter of time before downstream payments are integrated into the mainstream. The large-scale adoption of blockchain is beginning to take shape. But what will it look like after stablecoins are incorporated into the regulatory framework? How will other countries respond to this? The reasons for the success of stablecoins need not be reiterated.
The passage of this act also means that on-chain transaction mediums are officially taken over by the US. American private enterprises are benefiting from US Treasury bonds, and with control over currency, this country will have a high degree of control over on-chain activities. Without discussing the continuation of dollar hegemony, how should I imagine a scenario where all stablecoins in a DeFi project are suddenly frozen?
On the other hand, there are YBS stablecoins. Ethena's concept is good; it can provide UST-level yields in a bull market while having stability far exceeding that of traditional stablecoins. In my previous articles, I also mentioned that on-chain native stablecoins may ultimately achieve Delta-neutral hedging, such as the more complex f(x) Protocol, which hedges on Hyperliquid. But strangely, everyone has started to create YBS stablecoins, first with various traditional hedge funds entering, then market maker DWF joining, and finally exchanges wanting to get involved. They may not become Tether, but at least they want a piece of the ENA pie; this ideal is spreading like a virus.
This pathological YBS stablecoin craze has clearly deviated from its original meaning. Using one's original accumulation and adopting more aggressive strategies to seize market share, truly innovative projects are being crazily suppressed, and the threshold for startup projects is getting higher and higher. Yes, technology and ingenuity are no longer important here; whether or not to decentralize is irrelevant. Innovative projects like f(x) Protocol are not receiving widespread attention; now, the combination of Cex and high-end quantitative teams is the right approach. In this war, APY and convenience are everything.
Although compared to using small images or various bizarre narratives to exchange my ETH, YBS stablecoins may be a good choice. But the packaging of these Cex financial products becoming the only innovation in this round only indicates that most of the past paths were wrong.
III. Asset Issuance
Public chains are the largest asset issuance platforms, and ICOs were the beginning of this game. Everything that followed is a variant, but at least it promoted the birth of some narratives and pushed the industry forward. However, now everything is moving towards traditional internet development. The profit models of Base and Pump are actually infinitely close to Web2, with almost zero feedback to the community, and in this regard, they are even inferior to Cex. The original meaning of Web3 was to democratize everything; co-creation was supposed to mean building and prospering together, but it has now become distorted. This is just the first point; now all oligarchs are studying how to create asset issuance platforms, what constitutes innovative asset issuance.
Launchpads are now the only paradise where native crypto users can get rich, but it is also pathological. Besides paying fees to platforms and tools like GMGN, one must also experience the feeling of shooting in the trenches. Asset issuance has also begun to become nested, and it can even develop off-chain. Well, although NFTs and GameFi are not strictly decentralized, at least they have some on-chain components, have driven the construction of Infra, and have allowed this industry to break out.
Since the AI framework at the beginning of the year, completely off-chain projects can also issue tokens, and it itself is an off-chain asset issuance platform. Extreme speculation is instead lowering the industry's bottom line continuously; what is the meaning of all this?
CZ and Vitalik are perplexed by memes, leading to the concept of DeSci, allowing speculators to speculate and researchers to innovate. It seems to have found a common ground, but how can studying lab mice and classical mechanics be more interesting than today's internet memes and bizarre AI? This narrative has only been popular for a while; after AI and DeSci cooled down, it was time for celebrity coins to make an appearance, from North America's President Trump to South America's President Milei, completely draining liquidity.
When the market begins to cool down and narratives fail to connect, Ponzi schemes must be played in asset issuance. Virtuals combined the Binance Launchpool + Alpha model, staking for points to participate in new offerings, and then staking again after participating in new offerings, leading to skyrocketing token prices. Emmm, so naked and direct, yet it no longer piques my interest. What’s next? Believe (the concept of internet capital markets)?
I cannot be sure, but in the last cycle, various flywheels, Ponzi schemes, and narratives still left behind a treasure called DeFi, which indeed sparked a lot of fresh ideas in the industry. What can speculation at this stage create? I only see a continuous simplification of issuance thresholds, and the accompanying malicious events are equally numerous. Do we need a new set of rules?
IV. Attention
In the past, the rise of a project relied on narrative and technology, bursting forth after building consensus. Now we are buying attention, using points to purchase like Blur, or using real money to form MCN companies for KOLs like exchanges. The combination of PDD and Douyin's marketing methods is prevalent in the circle; compared to founders running around to discuss technology, this method seems much more direct and effective.
Attention is undoubtedly one of the most valuable assets of this era, but it is also difficult to measure. Kaito is now quantifying it, but Yap-to-Earn is not really an innovation; it has been reflected in ancient SocialFi. Kaito's biggest innovation is AI-driven, claiming to recognize the "value" of information and measure sales ability using AI. However, this model clearly cannot truly capture long-term value; tokens are becoming a kind of "fast-moving consumer goods."
The drawbacks of the points system are something I believe everyone has deeply experienced. I have also reviewed the impact that Blur has brought to this circle in previous articles. If future projects rely on purchasing attention, I find it hard to evaluate whether this behavior is wrong. I can only say that there is no sin in projects striving for marketing, but the current circle seems to have a trend of everyone becoming pumpers. The old crypto era has indeed come to an end. Selling influence for profit has become a mature business, from the President of the United States to Binance and now to KOLs; no project has prospered because of this; everyone is just taking what they need.
Conclusion
Stablecoins will move towards the world, and blockchain payments have become a certainty. But the natives living here may not need these; we need on-chain native stablecoins, we need to de-financialize, we need the next wave, and we do not want to live in a Web3 that sells traffic.
Time indeed proves that some BTC OGs were not wrong in what they said back then, but I still hope that in the future, they are wrong.
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
