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The crypto industry is not becoming more mature, but rather experiencing disorderly entropy increase.

The crypto industry is not becoming more mature, but rather experiencing disorderly entropy increase.

ForesightNews 速递ForesightNews 速递2025/10/24 07:43
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By:ForesightNews 速递

The harsh truth of the market may be that what we are creating is a liquidity black hole, not a flywheel.

The despairing truth about the market may be that what we are creating is a liquidity black hole, not a flywheel.


Written by: jawor

Translated by: AididiaoJP, Foresight News


When people are faced with too many choices, they actually end up with fewer. In a famous study, a table with 24 types of jam attracted a large crowd, but almost no one bought anything. When the choices were reduced to six? Sales skyrocketed.


A complex paradox.


Now, apply this paradox to crypto. We have over 20,000 listed tokens, and if you count all the experiments, rug pulls, memes, and abandoned sidechains, the total could reach 50 million. It’s insane—the casino isn’t just open, it’s infinite. Infinite tables, infinite tokens, infinite meta-consumption.


The result? No one knows what to bet on anymore.


Retail investors don’t stand a chance, and wallet user experience is a minefield. You bridge across chains, pay fees, forget to revoke approvals, and end up holding ten dead tokens. Most new users leave within 90 days. It’s brutal, but not surprising. We’ve deliberately made this difficult, not to protect value, but to chase it.


The deeper issue is that crypto no longer feels genuine. We talk about decentralization and financial freedom, but every week there’s a new Trump coin, a new insider pump, another “influencer-led” rug pull. All this happens while liquidity fragments, narratives cannibalize each other, and attention grows ever more scarce.


This isn’t market maturation—it’s disorderly entropy.


Liquidity is a joke now


Even when capital flows in, it no longer drives the market like it used to. Why? Because funds are scattered across thousands of tokens. Everyone wants an “altcoin season,” but there’s no room left. You’re trying to inflate 1,000 balloons in one breath—it’s obviously impossible.


Take Axiom for example: it has amazing technology, but it hasn’t created new liquidity—it just siphoned off user capital without reinjecting it into the market. Or look at those OTC deals that dilute supply but only show up on the books when insiders decide to sell.


We are building liquidity black holes, not flywheels.


When the pool is drained faster than it’s filled, you get more than just stagnant prices—you get market manipulation.


Manipulation becomes cheap. Time-weighted average price games, oracle exploits, fake trading volumes—all too easy. Governance has become a joke. Voter turnout drops, whales grab everything, and Sybil attackers farm with 30 wallets unnoticed.


This isn’t just a user problem—builders feel it too.


Teams burn millions launching “the next L1,” but have no product-market fit. Projects chase the same primitive concepts, just slightly tweaked. Composability is broken because everyone optimizes for token value, not protocol stability. Mutable infrastructure stifles innovation.


Basic DeFi primitives used to be immutable—something other builders could rely on. Now, most protocols are upgradable, prioritizing short-term revenue over reliability.


This creates a chain reaction:


  • Builders can’t safely build on infrastructure
  • Liquidity becomes isolated
  • Protocols become isolated fiefdoms


We’ve broken the money Lego set, and now we’re playing with loose bricks.


This is unsustainable


Most of these tokens should never have existed. But in crypto, permissionless = inevitable. Anyone can launch anything. You can’t stop it.


But maybe we can shape the environment.


Centralized exchanges still act like value-neutral platforms. They delist tokens when trading volume dries up, not when teams disappear or ecosystems rot. That needs to change. Initiatives like @blockworksres’s token transparency framework are a start, but imagine if there were multiple token rating agencies, and their average scores influenced CEX listing/delisting decisions.


This isn’t censorship—it’s curation, and it’s urgently needed.


VC money is drying up, and mid-tier projects can no longer easily secure funding rounds. M&A volume hit a record in Q2 2025. Coinbase acquired Deribit and Echo. Stripe acquired Bridge. We’re talking about deals worth billions of dollars. Why? Because there are too many moving parts and too little utility in this space.


That’s not noise—it’s consolidation.


Too many projects chasing the same idea? They get absorbed.


Too many tokens diluting the narrative? They get eliminated.


Too many chains with no appeal? They go under.


Less noise, more signal.


Let’s build something worth believing in


Crypto needs to have conviction again—not memes, not hope, not another locked token presale with a $300 million fully diluted valuation.


Conviction doesn’t come from more—it comes from clarity, from a smaller surface area of things that actually work. From protocols that care more about product than pumping.


But we can build filters, not firewalls.


We can:


  • Require token issuers to increase transparency
  • Push exchanges to delist tokens based on integrity, not revenue
  • Create incentives for protocols to become composable again
  • Reward builders who ship real products, not just narratives
  • Favor fewer, higher-conviction bets over infinite “rotations”


The future isn’t about launching the next altcoin casino—it’s about creating systems people can trust, and want to stay in for more than 90 days.


The bull market will come again—it always does.


But next time, let’s not waste it on another 30 million tokens nobody needs.

0

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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