Market and some thoughts from the perspective of the East and West Speaking of which, it seems that this is the longest interruption of Twi. There is no other reason. As a blogger who never engages in social media, every time I write something, I essentially need to express my desire to drive it. However, in recent months, the market has made it difficult for people to feel this way. The decline of the secondary market is certainly a significant proportion, but the feeling given by the primary market may be the main reason for this lack of expression However, I have recently observed some phenomena and had some thoughts, which may take some time. Therefore, I plan to split them into three or four articles, with the main topics being "The Market from the Perspective of Eastern and Western VCs", "New Signs of RWA", and "Something Worth Talking About on ETH and Solana" Today, let's talk about the first topic first In the past few weeks, I have talked to several peers in Asia and found that everyone has coincidentally entered a "pause" or "conservative" investment model Our last move was in January, and several peers are similar. There are many cases where we haven't made a move for two, three months or even longer And for the feeling of the market, the word 'boring' may be the most appropriate adjective, or a temporary 'consensus' This boredom is not entirely related to the second level. I vividly remember that after the Luna crash, although the bipolar market was sluggish, we talked about good expansion projects in the primary market, such as ZK or innovative Defi, Gamfi， And AI, everyone is still excited. And this excitement, after entering 2025, will gradually be lost. The decadence of the secondary market, which is only a few days hot for any narrative, naturally has an emotional transmission impact on the primary market. However, a more concerning concern is whether we have entered a stage where the "low hanging fruit" has been roughly harvested, and thus entered a long period of adjustment, exploration, transformation, accompanied by corresponding severe pains? I will elaborate on this topic at the end because the current state of Western VC is somewhat different from that of the East The reason is that we invested in a Defi project in a Pre seed round last year and are currently in the Seed round. I was originally thinking that in the current primary and secondary markets, being able to fully finance would be very satisfying. Unexpectedly, several million US dollars were raised over time, and several European and American venture capitalists rushed to inject money into it. This result surprised me greatly. Although the project itself was good, it did not reach the S-level texture. Why is it that while Asia is "silent", Europe and America are constantly "firing shots"? What are the reasons why they dare to pull the trigger at this valuation? We had an internal discussion and made some irresponsible assumptions, such as 1. The timing of the establishment of venture capitalists in Europe and America is quite different from that in Asia, so the exit cycle is different, resulting in different investment decisions 2. Asian VCs have more or less the temperament of "small-town swot". In terms of yield, they either want to win the peers or at least run better than BTC (only few of them can do that in the current market situation --). European and American peers have a stronger flavor of idealism and long-term spirit, or as long as they can logically explain to LP why I invested in this project under this valuation, the persistence of yield is secondary 3. Pure Deploy Fund needs, after investing in this phase, it's better to quickly raise funds for the next phase, mainly collecting management fees The specific reason is unknown, so I can only guess at the moment. Therefore, in the next few weeks, I have arranged a group of European and American VC partners and researchers to chat with each other. In addition to exchanging views on the market, I also want to directly consult on the above issue in person. After collecting the information, I will update on Twi Then, turning back to the topic of low hanging fruits, I also want to take this opportunity to discuss with everyone where the future path of Crypto lies Firstly, both myself and ABCDE have never wavered in their long-term belief in Crypto Bullish, which can even be considered a 'faith'. Otherwise, they would not have pursued this profession full-time. But in the short to medium term, we are indeed at a crossroads, a crossroads that I am not sure if it is similar to before the appearance of Defi Summer in 2019, so I would like to share it with everyone The reason is also that I have been listening to AlliaceDAO's podcast recently, and the three viewpoints mentioned in it have resonated with me a lot Qiao said that his current feeling is similar to that of 2019, and he doesn't know what the next step for Crypto will be. It wasn't until the appearance of Defi Summer in 2020 that he was impressed and found his direction. 2. They believe that Crypto has only found one PMF over the years, which is finance, more specifically trading (Dex, Cex, Perp), lending, stablecoins, Mint (asset issuance, e.g Pumpfun） They gave a lot of Start Up suggestions for their AI x Crypto. If the Crypto elements in the project are too far fetched, it's better to simply remove Crypto and focus on pure AI. As a result, 30% of the projects really removed Crypto and became pure Web2 projects Regarding the period from 1 to 2019, although I was already in the industry, I was simply speculating on cryptocurrencies. To be honest, I'm not sure if the VCs at that time had the "boring" feeling they have now. However, in my impression, at least IEOs were popular, EOS was exploring directions, Starkware proposed the ZK concept, and many projects of Defi Summer in 2020 should have been established and invested in in 18-19. In theory, the perception of the primary market should be better than now. In other words, at that time, people's trust in the idea that "big things are coming" should be higher than now? Regarding 2-, it is a response to 1 and also my biggest concern in the short to medium term, that is, whether we have reached a crossroads where low hanging fruits have been roughly harvested, different from 2019. If the biggest PMF of Crypto on Utility is finance, then Defi Summer+'s continuous iteration of micro innovation in the following years has basically reached a boundary today And the opposite of Utility, which is also the narrative direction that Crypto excels at, Meme is undoubtedly the best representative, http://Pump.FUN In 2024, this direction has also been pushed to a boundary Furthermore, in the past few years, when Utility and Narrative were unsure of what to do, our circle was still able to compete with Infra. From ETH to EOS to Solana, and then to Aptos, Sui... I'm thinking, Solana has FireDancer this year, and Monad and MegaETH are likely to go live on the main network. Have we reached the boundary in expanding the blockchain Infra? Regarding the third viewpoint related to whether there is only the last road left, which is the "modularity of blockchain", when all three roads have reached the boundary at a crossroads, I also heard similar Insight in YC's podcast The modularity referred to here is not like Celestia's modularity, but rather the abstraction of blockchain technology as a whole into a module, which is inserted as a function into a Start Up, similar to AI The vast majority of Crypto projects we see now are entirely based on Crypto, or in other words, Crypto for Crypto's sake, rather than solving a real-world problem. It sounds good to call it Crypto Native, but if it doesn't sound good, it's just that it doesn't go out of the circle at all, and people in the circle are self interested The Web2 AI venture capital circle is likely to have similar problems, as many projects appear to be "AI for AI's sake" rather than solving a specific real-world problem. Will there be some kind of integration or encounter between Web2 and Web3 in the future primary market. A project must exist to solve a problem in the real world. In the process of solving the problem, if Crypto is needed, Crypto elements are added, and if AI is needed, AI elements are added. However, the original intention and purpose are completely unrelated to Crypto and AI. Just as Meituan Waimai uses 5G, platform software, big data, AI task allocation... but it is essentially a project born to solve the problem of eating If the next major stage of Crypto is in this form, will everyone feel bored? Crypto VC， Can the current form based on the Crypto Native industry chain, including exchanges and studios, continue? There are more and more Payment and RWA related projects in the current primary market, which to some extent conform to the idea of 3. Recently, I researched Ondo's Global Market and talked about several RWA projects. The next article will specifically talk about the new direction of RWA in this field