Crypto Evolution: Entering the Adult Market, From Speculation to True Holdings

The term "internet capital markets" encompasses many meanings. In today's context, it refers to the alchemical achievements of blockchain technology: financial technology that defies geographical boundaries. Lending and borrowing with "magic internet money," tokenizing treasury bonds and private credit, and issuing stablecoins are all part of the "internet capital markets" narrative at the intersection of traditional finance and digital assets. But for veterans of on-chain trading, breathing the whiff of this asset class, the internet capital markets encompass more than just "on-chain treasuries"—they encompass NFTs, DeFi, ICOs, and the myriad speculative instruments invented over the past decade, as well as the tokens that have been tradable since the first smart contract was deployed on Ethereum in 2015. This article aims to focus on the underlying logic behind currencies, narratives, tenfold and hundredfold returns, and airdrops, analyzing this aspect of the internet capital market. We are about to usher in what OG crypto players call the "new metaverse." To understand this, we must first examine these capital formation mechanisms and the differences they bring. The Evolution of Market Financing Mechanisms Looking back over the past few cycles, we have seen that market financing mechanisms are constantly changing. From ICOs to centralized exchange altcoins (CEX Alts) to meme coins... the above diagram summarizes this process, which can be briefly summarized as follows:

Original ICO (2017s)

In this mechanism, funding is based on the "commitment" of the project owner, with the goal of selling to the biggest "suckers." The technology is rarely practical or has no value added. Most of the time, it's just a game of "pass the parcel." Typical examples include Bitconnect and Dentacoin. VC Paradise (2021 Bubble) This wave attracted institutional capital, but in retrospect, it caused significant damage to the industry—ridiculously high valuations and poorly designed incentives (who would work for $100 million?). However, this wave also brought more reliable products—so it's not a blanket statement. Despite severe inflationary valuations, it also gave rise to many of the protocols you love today. Take Ethena, for example: I love it, but its "too much, too soon" mechanism did hurt its early performance in terms of "token appreciation." However, it is unarguably one of the best crypto products currently available. This was also the era when projects like Solana and Uniswap rose to prominence. Even if one has objections to their governance or operations today, it's undeniable that it wasn't all bad. After the FTX collapse, the crypto space experienced an existential crisis—distrust spread, and many began to believe, "Everything is a scam." I felt the same way at one point, but it's important to understand the nuances. While similar to casinos, not all are casinos—stablecoins and tokenization are finding immense value in real-world scenarios, not just in meme-generating and niche asset pairs trading against the US dollar. During this period, pure memecoin projects like dogwifhat and pepe emerged, alongside more "serious" narratives like AI agents. Valuations have plummeted, and you might ask, "Are they all memes?" However, once labeled "meme," it doesn't mean they're destined to remain that label. Maturity is a gradual process, and some projects, like REI, have already made the leap from "label" to "serious." The marriage of legitimacy and digital markets: We're entering "adulthood"—institutions are here, and they're genuinely excited. But having spent so much time "inside the factory," having seen the sausage-making process, we can't help but be pessimistic about Circle's IPO. Knowing too much can be a curse—labeling everything "meme" only erodes your faith. Consider Ethereum: For two years, it's been the worst-performing asset, with many heavy holders selling their positions and the media decrying its decline. And yet, look at the situation now: Do you think Tom Lee knows about (or cares about) the embarrassing video of the Ethereum Foundation's leadership dancing and singing on stage? Do you think institutions like BlackRock, which launched a tokenized fund on Ethereum, care about the Ethereum Foundation's "soy-boy mentality"? The answer is no. This is something you must internalize. Most cryptocurrencies have forgotten how to "dream," while traditional finance is learning to "dream" again. This will bring more opportunities—as digitization and mainstream adoption advance, more and more high-quality builders will join the fray. The Future of the Internet Capital Market This is what I mean by the internet capital market. We are experiencing a boom unprecedented in the past five years—a perfect combination of regulation, technological prowess, and capital, much of which will occur on-chain. Seriously, I believe some of the most valuable companies in the coming years will issue tokens on-chain. In fact, this is already happening. Hyperliquid is a pinnacle example of the internet capital market. It received no VC investment and has no equity burden. It is a purely on-chain token project, not initially listed on an exchange. Let me emphasize again: Hyperliquid was once a $40 billion company, with no roadshow materials and no burdensome equity structure. This pure-play on-chain giant dominated the market from the moment it emerged and is now on its way to $1 billion in annualized revenue—from zero to one. It is the purest manifestation of the workings of the internet capital markets. But please don't get me wrong, I'm not touting Hyperliquid. I believe there will be many more examples like this in the coming years. Isn't it exciting? We are entering an era of abundance—don't let your cynicism stifle your dreams. Sadly, this seems obvious to many, yet we're busy chasing a 50% return on some random shitcoin because that's what we've been trained to do for the past four years. It's time to dream bigger—the script is already written. Now, the shackles that bind us are gone. People have long been constrained by past structures—but in the era of internet capital markets, owning 5-10% of their own currency and building it into a product worth $100 million to $1 billion will yield returns far beyond expectations. Yes, financing is still necessary, and there's nothing wrong with ICOs. But consider Hyperliquid's approach: if you believe in your product, issue on-chain tokens, retain a sufficient share, and let the market, the arbiter of truth, determine its value. What's wrong with capitalism? It shortsightedly instills in its participants. It does drive innovation in the right direction, but it fails to truly drive it. Too many people settle for quick bucks and miss out on the greater returns of long-term compounding.

Long-term thinking usually leads to geometric rather than arithmetic results—for example, doubling in 2 years, quintupling in 4 years, and tenfold in 5 years.

Of course, you can make $10 million by developing a product and then abandoning it, or you can make $300 million by just spending a few more years developing the product.

Conclusion: From speculation to true ownership

Finally, a word about the speculative nature of the market. In the short term, the market will undoubtedly remain a voting machine—the prices of "worthless" assets will rise, the prices of "good assets" will exceed their intrinsic value, and team sell-offs may recur. But the key point is that this wave of digitalization will attract more outstanding and truly constructive founders to join the market. I believe this is an inflection point, which will give rise to more outstanding on-chain products. Think about that diagram: it will never return to zero, but it doesn't have to. Look at Hyperliquid, Ethena, and Aave—they all have annualized revenue of $1 billion, stablecoins with a TVL of $10 billion, and net deposits of $60 billion. Look at Pengu and Rekt—they have a combined 197 trillion views, 2 million pieces of merchandise sold worldwide, and even have drinks available in 7-Eleven convenience stores across the United States. They are all backed by on-chain tokens. The more S/A-rated projects and founders there are, the less attention there is paid to founders rated C and below—less attention paid to short-term projects like "air coins" and more attention paid to projects that can truly achieve compound growth. We can argue about whether they are overvalued or undervalued, but I'd rather have this discussion than return to an era of buying into empty promises. I'm forced to buy into assets of companies that sell promises but deliver nothing. I'd rather own something tangible than pretend to play a game of pass the parcel. If you keep treating every coin as a "meme," you're wasting your time. Tokens issued by projects like Hyperliquid are no longer a fantasy. The next Steve Jobs could very well be issuing a token on-chain. Some of these assets will eventually become on-chain giants that control the future of finance. And we all have the opportunity to buy into them. Reducing them to "just a meme" is a great way to reap a thousand-fold return. This is the evolution of speculation: we've gone from trading worthless air to finally owning the hard, durable, and most importantly, on-chain assets that will shape the future of our world. It's time to rekindle our faith, unshackle ourselves from the past, and rebuild our dreams. The future is bright; don't let the shadows of the past cloud your optimism. This—this is the future as I see it: Internet. Capital. Markets.