Author: Dayu
I didn't sleep all night yesterday, tears soaked the sheets. I shouted at the night sky, is the crypto world just going to keep trading these garbage coins? They all need to die together; even the roots of the retail investors are gone.
I think I should do some user education, telling everyone, especially newcomers, which coins are still worth buying and which ones are not—because only by refusing to eat shit can we force the crypto world to develop positively, and make the manipulators realize that making people eat shit is no longer profitable. They need to find ways to create projects that are genuinely useful and profitable for people; only then does the crypto world have a future.
I will express myself as cautiously as possible, so that those who read it can make money rather than lose it.
1. Current Situation and Coin Selection Logic
In the current crypto world, there are mainly two activities: "creating shit" and "feeding shit."
Creating shit refers to project teams without profit capabilities, telling a story, spending some money, getting listed on some exchanges, and then waiting for retail investors to take over, profiting from market making and other methods, while only the exchanges make money. If this continues, the industry will definitely cool down.
In the past, this way of playing was acceptable because the crypto world was a big casino, and we just needed to have a chance to make money.
Back then, there were very few coins, and everyone had little investment experience; there was no concept of high or low valuation. Once a coin was listed, people rushed in, and with some rushing, there were price fluctuations, leading to some making money and others losing. That was just how it was.
At that time, we didn't understand, but we had beautiful dreams, truly believing that the crypto world was changing the future. But now, seeing the flourishing development of AI and the US stock market, while we are arguing over which pile of shit to list on exchanges, we finally understand how ridiculous, sad, and lamentable we are in the crypto world.
Why is this way of playing no longer viable? Because there are now too many coins.
Those with backgrounds follow Binance, from issuing coins, marketing, to getting listed on Binance in one go; those without backgrounds can also use PUMPFUN to issue coins and then sell shit on Twitter.
From five years ago to now, the number of coins has increased by 100,000 times, but the number of people has peaked—Binance's annual report states that one in every twenty people uses Binance. This is good for Binance, but it is also why the industry has begun to feel unsustainable. The growth of newcomers is ultimately declining, and when there are fewer and fewer newcomers in the industry, problems will arise.
We cannot expect someone to do something; that is a very foolish behavior—who cares about the barking of a stray dog on the roadside when there is a feast at the rich man's door?
People need to empower themselves, and the crypto world needs to empower itself.
The first step to empowerment is for fewer people to take over garbage coins.
Next, I will guide you from "how to choose" to "what to choose," providing you with an article that allows you to navigate the crypto world with ease.
I’m here, let’s go!
2. Several Evaluation Principles
I will explain this part in detail, which may be a bit challenging for beginners to read. Although I recommend that you take the time to understand it, if you can't understand it now, you can jump directly to the third part to see the list of coins.
1. Must Have Revenue
If a crypto project has no real income and no users, what is the purpose of this coin? How does it empower this coin? It is useless; once it gets listed on a major exchange, it just waits for you to take over, and then you hope that the idiots in the adjacent group will take over from you?
Stop! Don't play with such projects anymore.
When a new project comes out, don't listen to its jargon that you don't understand. You need to understand great companies like Apple and Tesla, and you don't need to know a bunch of letters and strange terms, right?
If a project has no income and no users, it is basically garbage. It doesn't matter who the other party is or what exchange it is listed on—because these backgrounds and exchanges are there to cut you, not to make you rich.
Remember: the bigger the background, the harsher the cut.
2. Must Have Development
Just looking at income and user numbers is not enough; project teams have already figured this out and need to hype.
Back in the day, the four kings of L2 were impressive, and the data was amazing. What happened? Once the hype stopped, it became a ghost town, and some haven't even issued coins yet.
So, you need to look at whether there is long-term development from common sense, not just data.
The current crypto world is such that when a project has innovation, a bunch of clones come out immediately, some with backgrounds and some without. Everyone uses coin issuance to attract people to hype, all of which is false prosperity.
If you want to make money, learn from the big players who are good at extracting profits; go extract, don’t take over. Projects that truly have development are those that, after the hype, genuinely have users, or even from the start, don’t need to hype—there are no points, no PUA, just use it.
Some say this is the characteristic of WEB3, but no WEB2 project needed to hype; all that came out were impressive projects. Why is that? From a common sense perspective, you understand that those who truly want to do projects do not want fake data.
Wang Xing of Meituan stood out from thousands of group buying websites, and one point that impressed me deeply is that others were all faking it. The data and traffic were many times that of Meituan, while Wang Xing insisted on not using any fake data, such as raising prices before giving discounts, believing that the market was large and that he needed to provide higher quality products for everyone, which allowed him to laugh until the end—he did it right.
What if you want to buy in the secondary market? Go back to the principles mentioned in this section and evaluate them against each other. If you buy in the secondary market, you need to know who is shouting for this project, your cost needs to be lower than the market, you need to assess whether there are more idiots to take over, and you also need to know when to take profits.
Beginners know nothing; don’t buy based on my method. If you don’t understand evaluation and dynamic observation, just buy Bitcoin.
3. The Coin Must Be Useful
A project can make a lot of money, but a coin is not a stock, and you are not a shareholder, so the coin is still garbage; don’t touch any of them. Because in this case, the coin is a speculative item, with no relation to the project's fundamentals, relying entirely on how the idiots think and act.
For example, if a top influencer overseas says they are bullish on ZEC, everyone rushes in. At this point, it’s the early believers who make money, and as for the project itself having no income and the coin being useless, you don’t need to study so much; just believe in the cut first.
But if there’s no income and the coin is useless, and you still take over, you will definitely wonder: why did it not rise as soon as I got in?
Therefore, with a long-term mindset, you need to return to my principles: how much money does the project make? Does it have a future? Is the coin linked?
4. How to Calculate Profit and Coin Price?
Let’s take the leading perpetual contract project $HYPE as an example to calculate. By the way, this is the best altcoin project in the crypto world, but if you bought it at over 50, aren’t you dumbfounded now? The estimation method in this section is suitable for beginners to study carefully.
For example, if I decide to buy HYPE, how do I evaluate this project that has income, users, and a future?
Step one: Look at how much it is currently earning and what its fully diluted market cap is.
If $HYPE earns $2 billion a year, and if the fully diluted market cap is $20 billion, then we can consider the fully diluted market cap/income = 10, and the coin price is around 20. Compared to tech stocks, a PE of 10 is not high, indicating it might be okay.
But if it doesn’t earn $2 billion a year, then a coin price below 20 seems reasonable?
But why did it rise to over 50? This part is detached from the fundamentals, and there are many reasons, mainly:
— It is a leader, so it is easier for people to FOMO into the leader, hence the rise, especially since there is a lot of dumb money in the crypto world.
— It has a 100% revenue buyback of tokens, and the order book is very thin, with daily buy orders of $2 million. As long as not many people sell that day, it is easy to rise.
So, rising to 50 is very reasonable in a bull market context.
But can it be bought now? You need to consider some new internal variables:
For example, the team’s tokens are starting to unlock. Although daily buybacks are still ongoing, if the unlocked tokens are worth $10 million while the buyback is $2 million, you can understand that the selling pressure is $8 million. The current situation of HYPE is that the selling pressure far exceeds the buyback.
Additionally, you need to consider external variables:
The first variable: external competition is starting to intensify.
For example, LIGHTER and others, with team backgrounds and financial strength similar to HYPE, and institutional investments, HYPE is like COINBASE, while LIT is somewhat like ROBINHOOD; plus, CZ’s ASTER and a bunch of new perpetual contracts.
This leads to a problem: external competition is becoming increasingly strong, and is this competition effective? Some are, just look at the on-chain data; HYPE’s market dominance has been significantly reduced.
Moreover, competition will only become more intense, making it harder to navigate.
If you want to find a girlfriend, she was originally a fairy, but suddenly five others want to be your girlfriend too, and they are fighting over you. You better not rush in, or you might choose the wrong person easily…
The second variable: the amount of existing funds is limited, and who can attract new funds is still uncertain.
The existing funds in the crypto world are limited, meaning there are only so many people and so much money in the crypto world. What is the upper limit of the scale of smart money + dumb money combined?
I think using TRUMP as a benchmark is relatively accurate, which is about $70 billion; after that, there’s no money left.
The perpetual contract sector is far less interesting and appealing than TRUMP, so its upper limit might be $40-50 billion.
This just happens to be around the market cap of HYPE during its pullback. Now, with intense competition, it’s like Meituan and JD fighting, and everyone’s stocks are falling similarly, plus the bear market, making a total market cap of around $30 billion very reasonable.
In a total market cap of $30 billion:
If there are only one or two targets, then the leader can be $25 billion.
But what if there are 10 targets? What is the leader's market share then?
So, if it’s just internal competition, there aren’t many ways to make money: mainly by extracting profits from coins that haven’t been issued yet, but there will definitely be counter-extraction later, so not participating is also an option; secondly, see which project can attract the most future retail flow from the US stock market. If the retail investors in the crypto world stop being cut and start cutting the retail investors in the US stock market, then this project can stand out.
5. Summary
In one sentence: whether a coin should be bought depends on how much it can earn now, how much it can earn in the future, and how much of that money will be used to drive the coin price up, while also dynamically observing how intense the internal and external competition is.
3. Coin Selection List
Catching three or four coins in a round of market can be enough to turn things around, but getting one wrong can lead to significant losses. The list I provide is definitely not exhaustive; there may be some decent projects I haven’t mentioned, as I wrote this article on an empty stomach. I will update any thoughts I have in the comments section later.
If you have good recommendations, please share them in the comments—however, regardless of who recommends, don’t make judgments lightly, including the coins I selected. You need to look at the models I mentioned above—they are not universal formulas and may have some mechanical aspects that do not apply to certain projects, such as the rising logic of public chains, but overall, they are meant to avoid eating shit.
Note: You must read the text regarding the coins. Just because I wrote the name of a coin does not mean it can be bought now! A good project also needs a good price!
You should use the valuation methods I mentioned above to evaluate. For example, the above methods allowed me to bottom out HYPE at 10 and sell it at over 30 and 50 (the logic for buying and selling is detailed in my group, not just me boasting to elevate myself). Now, let’s start.
1. BTC
Newcomers may overlook it, but if you can only choose one coin in the crypto world, it must be this one. Although it seems not to rise now, it may quickly surge to 200,000 in the future.
If you are a beginner with no knowledge, buying the coin at 80,000-90,000 will not lead to losses or scams; just take this one, while you crazily catch up on learning, and buy less of other coins; you can’t go wrong.
2. ETH
The biggest development in the future of the crypto world will come from institutions bringing US stocks and bonds on-chain. Once on-chain, Wall Street and retail investors can trade on-chain stocks, which is the biggest advantage of ETH, making it the second in the crypto world.
However, I have never been particularly interested in it, so I personally do not hold much, as I have also researched US stocks. If viewed as a tech stock, then using the model I mentioned above, it really doesn’t look that great.
ETH has a market cap of hundreds of billions, with unlimited issuance, and the coins obtained by the stakers will continue to increase. Buying this coin feels a bit like taking over, which I personally find uninteresting. Those who are optimistic now are very FOMO, thinking it is a civilization-level innovation and a good thing, but I am not sure if the coin price has enough certainty.
For example, its market cap is now higher than Musk's aerospace company SPACEX, which earns a lot of money every year and is set to earn even more in the future, planning to build bases on Mars, turning humans into a multi-planetary species, mining vast amounts of gold in outer space, and developing energy. At a similar price, I would definitely buy SPACEX.
The recent rise of ETH is mainly due to top institutions from the East and West shouting and buying together, but the fundamentals of ETH will not change because of this. If you believe in it, get on board early, and when the time is right, find a position to exit; having money in your hands is what matters.
As for the future outlook for ETH, such as becoming the base for on-chain finance, I agree, but I still only look at how much ETH can earn, how much of that money can be used to buy back ETH, and how much buying pressure it can create. Otherwise, it’s still a game of emotions and consensus—this is something I, as someone who has made the most money in this field, am very proficient in. My choice is that I will not gamble on such large targets with big manipulators; you can shout, play, and earn.
3. BNB
$BNB is still the best among all CEX platform coins.
However, I no longer recommend it much. The future is the era of on-chain, and five years from now, the largest trading venue may no longer be Binance, but rather on-chain exchanges. As a holder of BNB, the original holding of BNB, receiving token airdrops, and benefiting from it, now feels like repeatedly eating shit, which is no longer interesting. Additionally, Binance's business model is to continuously bring in new users, with contracts and garbage coins; this zero-sum game will definitely decline after reaching its peak.
But note, I am not saying that BNB cannot rise. With high control and the wealthiest institutions in the crypto world, it will definitely rise, but it is just no longer my ideal target. If I had to choose between ETH and BNB, I would definitely choose ETH, but I haven’t chosen ETH either.
As for $OKB, it has become a classic, but without revenue or empowerment, it can temporarily be classified as a garbage coin.
4. Other Public Chains
Currently, they are not very interesting, including SOL and other coins, many of which have very aggressive issuance. For example, SOL's price has dropped significantly, but its market cap is about the same as its peak. If MEME is not working, I will temporarily not play with it.
Public chains are likely to become important but not very profitable infrastructure because if you extract too much, many will leave. Fast speeds and zero fees will become the standard.
5. MEME Coins
I recommend not buying any MEME coins for now. Anyone shouting about any MEME coin is essentially saying, "Come eat my shit."
I currently do not see any opportunities. If you want to play, a small bet for fun is fine, just like buying a scratch-off ticket for entertainment; there’s nothing wrong with that.
Next, let’s talk about altcoins. 99.99% of altcoins are garbage with no income and no future. I will pick out a few that you can slowly buy a little of; holding them long-term should not lead to losses—ideally, you should use the valuation methods from the second section to find a suitable price.
I can only tell you good targets, but I cannot tell you good prices—because for each coin, you need to look at the models above, considering both the coin itself and dynamically monitoring external competition and the external environment. Basically, good projects need to be observed continuously.
What if you don’t want to observe continuously? Buy BTC! After buying, go play, go work, and see what?
6. On-Chain Perpetual Contract Sector
This sector is a real casino, with income and buybacks. The biggest opportunities in the future will come from external traffic, namely Wall Street institutions and retail investors.
$HYPE
This one is relatively simple; I have said a lot above. I think around 10, if there are no major issues or overly strong competitors in the future, this price should not be too difficult to hold for long.
The selling pressure from the unlocks in the coming year is significant. Many retail investors hope the team won’t sell, which is actually an unkind and selfish thought. Team members should receive returns, and selling is better—if you really believe in it, you shouldn’t hope they don’t sell, but rather hope for a lower price.
$LIT
In this sector, LIT is a direct competitor to HYPE, and it even has greater advantages, just because it is a later entrant.
The team backgrounds are all top-tier quantitative and genius, but HYPE only targets smart money and whales, focusing on large clients and institutions; LIT is more like ROBINHOOD, targeting retail investors.
HYPE has no VC and follows a community route; LIT has partnered with Castle Market Makers and ROBINHOOD investors. The founder is also a classmate and fellow villager of the ROBINHOOD CEO, with a very close relationship, overall following a Wall Street institutional and compliant approach.
In terms of architecture, HYPE has its own chain and ecosystem, closed within the HYPE world; LIT is part of the open ETH ecosystem, which can directly accommodate all RWA assets in the future. For example, hundreds of billions of funds borrowed on AAVE can be used directly in the LIT system under the security of ETH (even if LIT stops operating, the assets are still yours, which is quite good).
The cost of extracting profits from LIT is about $0.5, so in the future, if the price is below $2, it should be a good buy.
If you want to start positioning in the perpetual sector now, LIT is only 1/10 of HYPE, but its growth potential may exceed that of HYPE.
However, be cautious; just like HYPE a year ago, when LIT has a large number of unlocks in a year, it will need to be reassessed. Altcoins need to be observed dynamically. Currently, I believe LIT has significant cost-effectiveness compared to HYPE within a year.
But the risk of $LIT lies in acquiring market share. The most optimistic expectation (which AI considers to be highly probable) is that ROBINHOOD’s on-chain order book will directly use LIT, and its own public chain can serve as a settlement layer, etc. However, it is unclear how much ROBINHOOD invested in LIT and what percentage of shares it holds. If it holds a large stake, then during this round, the valuation seemed to be $1.5 billion, and now the market cap is over $2 billion—but be wary, as these are some optimistic expectations from the community. Even if it is true, it is still early, and it is uncertain how likely this is, which poses significant risk factors for newcomers.
As for ASTER, I think it is a garbage project that will die 99% of the time. I mentioned before that if Binance wants to support a puppet to compete with HYPE, it will definitely fail. I might have some bias here, but I don’t see any advantages in ASTER. If it talks about non-compliance, there’s HYPE; if it talks about compliance, there’s LIT.
Of course, from the perspective of the sector's logic, the perpetual contracts seem to have passed their most fragrant and beautiful time and are no longer the best choice.
Now, I recommend buying LIT directly from the official website, as the depth on other exchanges is too small.
Newcomers, please note: unless you have researched these extensively, do not buy high-risk tokens like $LIT. You do not have the ability to track continuously or to value them. My article is not specifically written for you, so please only buy BTC. Remember!
I. Prediction Sector
POLYMARKET: You can start participating with small amounts to play around and earn some small profits; this is suitable for newcomers. Experts and large funds are currently selling equity at a $12 billion valuation off-market. I tend to think it can also be bought, as it has significant income and great development potential, which is quite good.
Other prediction markets are all clones and are of no use.
Such projects can be created by gathering a team of a million in Nanshan, and then getting listed on major exchanges without needing to empower or explain. If you want to play, try to do it at a low cost; if you want to buy, first believe in the cut and then believe in the run; just run a bit faster.
The prediction sector is a super strong sector, not purely zero-sum. I believe it will be larger than perpetual contracts in the future.
II. DEFI Sector
$AAVE is a very good target, but its price is still quite high. For this valuation, you only need to look at how much it earns in a year and what its market cap is. I am too lazy to check it, but its PE is much higher than HYPE.
So this is a target that can be tracked and focused on long-term. But its risk lies in how much it can capture when US stocks and bonds go on-chain. BlackRock and JPMorgan will likely do their own lending—brokerages all have lending, and they will definitely do it on-chain in the future.
AAVE is listed as a good target because it is the best in the DEFI sector of our crypto world, with years of safety and hundreds of billions of assets stored in it, engaging in on-chain lending, very active, yet stable, with steady income and the token having a certain utility.
But altcoins are all risky! They need to be observed dynamically, and newcomers should be very careful.
For now, I can only think of this.
Projects like ONDO are securitized tokens with top-tier backgrounds, but the tokens are currently useless, and there are still a lot waiting to be unlocked. Moreover, after US stocks go on-chain, it may no longer be through this project that they can empower, so the uncertainty is quite strong.
III. AI Sector
$VIRTUAL is also a project with revenue, and the team is very resilient. I really like this young team; they seem to be one of the few that continue to explore new things and work hard for the token even through bull and bear markets, which is remarkable.
However, I find it difficult to value this project due to its high uncertainty; estimating it using revenue and such is not easy.
But it is worth long-term attention. After a significant drop, consider buying a little, as it is a good project, but I cannot say what a good price is.
$WLD is currently facing significant issues in its offline expansion, and the selling pressure from this expansion will continue. Keep an eye on it long-term; it is also early in terms of income, with all selling pressure, but it is a good project, especially since it is run by the boss of OPENAI.
IV. Privacy Coins
ZEC is very popular, but I think it’s better to wait for the bear market, when it drops to around 100 or so. Right now, it’s mainly big players shouting, and fools taking over. The future belongs to compliance; even the likes of Maduro, who are non-compliant, have been taken down from their beds. What privacy is there?
First believe in the cut, then believe in the run. If you can’t achieve the first belief, don’t believe; missing out won’t kill you.
For now, that’s all I can think of. I will add more in the comments if I have anything else.
Finally, you might say, there aren’t many coins here, so there’s nothing to play with? If you want to throw money, there are a billion coins waiting for you to buy, but if you don’t want to throw money, just buy good coins first. Within six months, more and more people in the crypto world will buy US stock targets, with plenty of short-term 5-10x opportunities. Moreover, once you get stuck, holding on often allows you to come back.
In the future, all exchanges, especially on-chain, will be filled with US stock targets. Why rush to eat shit?
*Note: The above content is for market information reference only and does not constitute investment advice.
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