Token2049 Essay Collection: The Industry is Undergoing Consolidation — After Pessimism Comes Dawn
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Token2049 Essay Collection: The Industry is Undergoing Consolidation — After Pessimism Comes Dawn
Do not get down from the table.
Navigating Web3 tides with focused insightsCompiled by: TechFlow
Every year after Token2049 wraps up, it's time for the classic "small essays." This article compiles eight of them, letting you feel the pulse of Singapore’s crypto scene without ever leaving your seat.
Jewish Director Zhao: Cycles, Dawn, and Liquidity Impotence
1. Never have I seen Western project teams work this hard.
2. In the past, old white men could just talk on video calls, and Asian markets would shut up and hand over their money. But now in 2024, they’re forced to host grand side events, dress up extravagantly, and even personally pitch deals. The last time they worked this hard was in 2019 when the guy with the afro came to Beijing fundraising.
3. The information gap between West and East remains enormous:
3.1 Western projects still believe there’s money left in Asia, trying to keep extracting value through endless new token schemes. Unfortunately, Asia is truly broke—there isn’t a single drop left;
3.2 As for where the money went: Asian exchanges’ perpetual futures products continued their tradition of absorbing most liquidity, while BTC ecosystem projects (inscriptions, runes, Layer2) successfully carved out a new lane for Asia by leveraging Bitcoin’s Asian narrative within an otherwise Western-dominated asset issuance space—both captured the majority of Asian liquidity.
4. Asia’s liquidity impotence also made writing Chinese-language summaries this year particularly difficult. After a busy week, attendees couldn’t articulate any real feelings because whether VCs, founders, KOLs, or retail investors, everyone had already burned through all their ammo. This year felt like eunuchs visiting brothels—emotionally detached, and at times, so zen-like that making money didn’t even seem important anymore.
5. Ultimately, whoever wants to make money becomes the sucker—the best way to profit is by taking money from those who desperately want to make it.
6. SOL’s Breakpoint was the brightest star among side events this year. Meanwhile, Ethereum—whether Foundation or Layer2—failed to host a single decent event to assert its presence:
6.1 If in April Vitalik was still the “Web3 Emperor Xian of Han,” then little V selling tokens for romance in September is nothing more than the “Zhou Youwang of Ethereum”;
6.2 The image of him singing on stage resembles completing a public humiliation task assigned by his concubine Baosi;
6.3 Calling for “banning subpar Layer2s” shows mental confusion—a weak ruler obsessed with beauty over governance, attempting feudal reduction despite having no power;
6.4 I’d really love to see how Web3 will perform its own version of “cleansing the emperor’s court.”
7. Regarding cycles, this current rally isn't a new bull market—it's merely the echo of the 2021–2022 cycle. That’s why this market feels eerily similar to 2019. Don’t believe me? Check your altcoin portfolio—aren’t most still tokens launched in 2021? The 2019 period wasn’t far from August 2020’s DeFi Summer kickstarting a new cycle—though it was also closer to the March 12 crash.
8. The primary market reeks of self-gratifying tragedy, and tragic sentiment is a dangerous signal—after all, not investing means waiting to die; investing means rushing toward death.
9. The market will grind down most people’s patience. New directions will quietly grow in silence. Directions I openly support include:
9.1 DePIN projects in Consumer Electronics;
9.2 CeDeFi RWA as underlying collateral for stablecoin issuance projects (BlackRock Buidl + USDM);
9.3 All on-chain trading tools and anything increasing on-chain leverage (Perp Dex);
10. A new cycle is near, but the darkness before dawn is pitch-black and the most demanding on one’s mental resilience. The convergence of traditional finance and crypto will happen faster and stronger than expected. Whether crypto rises collectively or gets co-opted, we’re facing an infinite expanse of uncharted territory unlike anything before.
11. You must not fall before dawn arrives. None of us can afford to collapse—we are each the final line of defense for this industry, because behind us, there is nothing.
12. One final quote to leave you with: Those who emerge from storms never relied on umbrellas.
Ruby (Incuba Alpha): Industry Shuffle in Progress
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The industry is reshuffling. Mid-sized and small VCs are being cleared out—many can’t even achieve DPI of 1. Conversely, top-tier VCs continue growing, closing new rounds rapidly within five months. Only early-stage incubators with taste or vertical-focused VCs can leverage high odds/specialized advantages to survive.
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Regulation is the elephant in the room. Americans are more optimistic about U.S. regulation than Chinese players. Compared to fearing risks, accurately assessing them and understanding what you're exposed to matters more.
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Market makers remain the most critical players. Many new MMs have emerged. Founders’ ability to select and persuade MMs has become a core competency. Judging market conditions (bull/bear) and structuring appropriate MM deals is essential.
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The most discussed application赛道 are SocialFi and AI Crypto. AI has hard barriers—need to wait for a technological breakthrough inflection point. Pumpfun is the most successful SocialFi example. True Web3 SocialFi isn’t Web3 Twitter—it’s a gamified casino.
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Quant profits are further compressed. Many quant teams exiting A-shares are entering crypto.
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BTC, stablecoins/payments, and casinos are currently the only proven business models. Stablecoins have become the new battleground in the primary market, yet no one can clearly explain how to break Tether’s network effects. Everyone must prepare for a future where, absent innovation, all new capital flows solely into BTC.
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From an ecosystem perspective: Solana’s Breakpoint was livelier than the main conference. Developers are excited about Firedance potentially breaking Solana’s “chain downtime” curse. “Pay now buy never” attempts to inject Ponzi mechanics into payments.
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Ton’s ecosystem traffic effect is starting to build momentum. Its ecosystem is fiercely competitive with micro-apps. Several game-focused VCs brought Web2 gaming teams onboard. It remains unclear whether they’ll expose fake traffic or convert Telegram薅羊毛 users into retained ones via VC-backed GameFi Ponzi subsidies.
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AI ecosystem feels awkward. After decentralized AI and AgentFi were temporarily disproven, well-funded AI projects are now reinventing themselves as new alt-Layer1s.
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Don’t blindly trust authority or intermediaries during listings. Exchanges care only about how many new users a project brings. Strong product, brand, and communication trump everything else.
0xLouisT (Partner at L1D): Alt L1 Revival, GameFi Forgotten
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Fragmentation & Attention Competition
A highlight of Token2049 was the record-breaking number of side events (over 600), reflecting the field’s current fragmentation.
VC-backed projects are clearly fighting for attention, trying to outdo each other in events, dinners, and marketing. I sense the private market is saturated and overflowing with capital.
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SOL vs ETH
Solana undoubtedly dominated conversations. Breakpoint showcased an impressively strong Solana community.
In contrast, Ethereum continues struggling with identity crisis. I noticed some ETH investors lack Bayesian thinking—they struggle to update their narratives despite new data points.
Notably, despite low market sentiment, most people’s ETH holdings barely changed. Most holders I know haven’t significantly adjusted their ETH allocation. Yet cracks are appearing, as some begin swapping ETH for SOL.
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Alt L1 Revival?
Solana’s success and ongoing philosophical debates around ETH have reignited interest in new L1s. Some claim SOL will be the ETH killer; others believe another L1 might kill SOL.
Monad and Berachain drew significant attention, but when I asked why people liked them, arguments boiled down to one thing: higher TPS than competitors. Sui was also frequently mentioned. Question is: do we really need this much blockspace?
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L1/L2 Shift to B2B Infrastructure Providers Is Failing
I observed that over the past year, several tier-1 L1s/L2s struggled to gain traction and usage. Now they’re pivoting to become infrastructure providers for rollups and app chains. These strategic shifts often focus on B2B deals, which create little meaningful value for tokens. This trend seems bearish for token holders but potentially bullish for equity holders.
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What Are Fundamentals?
People are refocusing on crypto fundamentals, but there’s no consensus on what these actually are: profitability, cash flow, organic vs inorganic revenue, volume, transactions, TVL, TPS?
While moving toward fundamentals makes sense, I’ve noticed heightened focus on fundamentals and cash flow often coincides with market bottoms. As Howard Marks said, cries for fundamental analysis peak at market lows—fear drives investors toward quality assets.
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Aave = DeFi?
The narrative for a DeFi revival is forming, yet most investors still don’t believe in anything beyond Aave (which is already quite mainstream)... Might I suggest looking at Pendle?
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VC vs Liquid
At Token2049, I spoke with many primary-market projects shifting focus from venture capital to liquidity funds, aiming to:
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Liquidity investors: due to lack of secondary buyers.
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Liquidity providers: amid intensifying competition for capital and attention.
Many VCs recognize the shift and are launching liquidity funds. However, due to poor fund flows, raising capital is currently difficult. Simply put: most secondary funds underperformed Bitcoin over the past year. Still, I believe secondary funds will vastly outperform VCs this cycle.
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Infrastructure vs Applications
There’s slow but clear acknowledgment that we’ve lost ourselves in infrastructural ivory towers. Crypto needs more applications and tangible use cases. DeFi and DePIN are the two most anticipated areas for new app development. Still, I haven’t heard consensus excitement about specific apps.
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Use the Products
I never thought I’d say this again, but using products genuinely gives you an edge. Many investors and researchers write 20-page reports without ever using the products they analyze—this is insane.
After countless conversations, I estimate at least 75% of investors aren’t actively using the products they invest in.
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Hyperliquid: Perp DEX Chad
Hyperliquid is pulling ahead. With smooth UX, it’s becoming many people’s go-to exchange. Opinions are split—some love it, some hate it.
Traders are transparent: some hold massive points balances, betting big on token launches. Hard to predict initial performance, but worth watching closely.
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Memecoins Remain Under-Allocated
Interpretation is up to you, but surprisingly, most institutional funds and whales have 0% exposure to any memecoin—not even DOGE or PEPE.
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GameFi Has Been Forgotten
I hardly heard anyone mention Web3 gaming or express excitement about it. I believe this indifference signals bottom sentiment.
I expect a Web3 gaming comeback. Several projects currently offer highly attractive risk/reward ratios at their valuations—but that’s a topic for another day…
Zolo (Co-founder, TechFlow): Optimists Always Drive the Industry Forward
From WebX, KBW to TOKEN2049, each event has set new ATHs in attendance.
Another year, another conference—what are people competing over this time?
1-Competing on dresscode: The trend started by Berachain eventually caught everyone. Wearing a mask is standard now; the boldest go onstage completely naked. Same goal: maximize virality.
2-Competing on DJs: Checking DJ rankings, physique—even whether the DJ has hair.
3-Competing on awards: This year, nearly every event handed out awards. Most weren’t real honors—they were just social niceties.
That said, the most impressive awards this year came from Breakpoint—one of the best conferences I’ve attended recently.
Breakpoint2024 – One of the Best Conferences This Year
Main features:
1-Most speakers given only 5 minutes—forces concise, impactful sharing;
2-Added debate formats instead of dull panels;
3-Unconventional award segments—maximized community vibes.
Walking into the Solana pavilion feels like entering a supermarket—not just an exhibition hall.
From Jupiter, Pyth, Wormhole, Birdeye to dozens of others, nearly every project launched something new—no boring moments throughout.
The conference used two stages. I lost count of how many times I ran back and forth, left to right and right to left, just to catch key sessions.
Day one ran from 10:30 AM to 6:00 PM. Thanks to tight scheduling and virtually no ads, every session was packed.
During talks, whether it was thunderous applause for “Firedancer” or chants of “GO!” for “DeGods,” you could feel the Solana community shares strong consensus on big-picture direction.
Everyone knows what Solana’s future priorities are;
Everyone knows which projects are truly loyal members of the Solana ecosystem;
Everyone understands inside jokes only insiders get.
That Solana is this cycle’s beta play is widely agreed upon. The disagreement lies here: many feel that once major projects like Pyth, Jupiter, Wormhole, Drift launch, there won’t be much alpha left in Solana’s ecosystem.
That’s simply not true.
Projects like Backpack, Cube, Flashtrade, Sonic, Solayer, ComputeLabs—and many more—are surging onto Solana, building increasingly interesting things.
I remember during the tech-focused stage, the host asked how many in the audience were first-time Breakpoint attendees. Nearly half raised their hands—fresh blood accounted for 50%!
Solana, having climbed out of the valley, now boasts a tougher, more resilient community. Thank you, Solar, for letting me experience such an event.
Solana, you deserve such an amazing community.
Move Ecosystem: Another Source of Alpha Beyond Solana
During TOKEN2049, Sui’s surge attracted significant attention.
Sui Builder House was one of the hottest pre-TOKEN2049 events.
I started advocating for SUI around April this year, mainly based on three logics:
1-Solana traffic overflow: For developers/speculators who think Solana’s ecosystem is saturated, they seek the next alpha. Last cycle had Polygon and Avalanche; this cycle likely includes SUI and Ton;
2-Relevance between Move and RUST: Transitioning from Rust to Move isn’t hard. So whether Solana projects are pushed out or want side projects, Move-based chains are natural choices—e.g., Solend launching Suilend on SUI. This applies to SUI, Aptos, Movement alike;
3-Endorsement from technical peers: Both Sui and Aptos have launched mainnets with tokens. After consulting technical friends, many believe Sui has better tech documentation.
Back then, there was no Grayscale trust or native USDC on Sui. With these additions, Sui’s prospects look brighter.
Overall, I’m highly optimistic about SUI, Aptos, and Movement. While writing this, $APTOS rose 14%.
However, Sui still suffers from too few hype-worthy assets. Despite launching SuiPlay and hosting Korea’s largest gaming booth at KBW, standout projects remain limited—Cetus, Turbos, Navi, Scallop, plus memes—barely enough to count on two hands. Hope Cetus and Sui’s incubation program produce more.
Aptos seems unclear to users/community about which direction its foundation should push. Movement is currently the only Move-based project without a token—stay tuned, hoping to see breakout cases soon.
With rate cut expectations rising, optimism is returning
From Japan, Korea to Singapore, as a trading novice, I seized every chance to ask friends about market outlooks. Generally, people seem more optimistic now.
Two or three months ago, most believed the cycle had ended—or at best, the bull market would end by Q4 this year or Q1 next.
Now, expecting the bull to last until Q1 next year seems conservative—many believe it could extend to Q3.
Main reasons: rate-cut cycle has begun, 50bps is just the start. Liquidity injection takes time, and capital flight from美股/BTC hasn’t kicked off yet.
Key uncertainty remains the November U.S. election.
Although some say people are just seeking exit liquidity, and veterans express deep disappointment, claiming zero innovation…
My advice: Let it go.
Don’t fixate on pessimism—let the disappointed leave.
There are still many hardworking founders and projects. Yes, some are hunting exit liquidity; some are pumping memes and schemes. But many others persistently explore industry directions, iterate relentlessly toward PMF, and top-ranked token founders still hustle across venues like workhorses.
Take Jambo: from last cycle’s “Africa phone” concept to selling over 500K units, covering 120+ countries, recently launching JamboPhone v2. Every meeting with their founder radiates passion.
Take Solv: from struggling to find PMF to embracing the BTC ecosystem, their resilience built $13B in solvBTC;
Take Sonic: from building marketplaces for games to gaining fame constructing SVM;
Take Matr1x: from launch to listing to testing, enduring criticism, now officially launching open-beta gold-mining gameplay.
Every cycle has naysayers, just as every project faces FUD.
Pessimism or FUD—whatever it is,
the industry is always driven forward by optimists. Without FUD, there can be no real community.
Let’s charge toward the beautiful things!
Captain Jack: Primary Market Faith Collapsed, But Don’t Leave the Table
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Most panelists expressed bearish market expectations, even worrying that if no new innovations or growth appear by May next year, the entire market ecosystem may undergo restructuring;
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Innovation is lacking. Value concentrates toward leaders. Top 15 coins by user count and market cap weighting—like DOGE, SHIB—have dropped 70–80% from peaks, others worse. (Based on data I’ve seen, I suspect exchange trading volumes may have declined ~80% this year);
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Decentralized stablecoins and payment applications represent clear growth sectors;
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Primary market faith has collapsed—few projects invested in over the past two years have profited;
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With poor returns in primary, professional institutions dive into secondary. Li Lin deployed $500M into a secondary quant master fund—quants are flooding in;
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We estimate fewer than 10 institutions currently possess stable secondary quant capabilities;
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For retail fighting quants: strategy is buying and holding top 5 large-cap coins, reducing trades, enduring passively;
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As retail buys and holds, exchange trading volumes and AUM shrink—exchanges suffer;
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Mid-tier exchanges ramp up marketing aggressively. Attended Bitget, XT events; joined Gate colleagues overseas; saw BingX, Weex promotions… Exchange marketing costs will rise;
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Ton and Solana ecosystems seem to offer structural trading opportunities;
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As an internet veteran since 2003, despite seeing problems, compared to 2000, we now have far more professionals, skills, infrastructure, users, industry scale, and room for sub-sector growth. So, don’t leave the table.
Little Crow (Editor-in-Chief, Crypto City): Rich Events, Yet Innovation Lacking
According to official stats, this TOKEN2049 hosted over 400 speeches, 700 side events, and up to 200,000 participants. Coupled with follow-up activities like F1 races and Solana Breakpoint, Singapore accommodation prices surged, lines grew long, and traffic jams even occurred near Marina Bay Sands. Public opinion on the event is sharply divided:
From an observational standpoint, the event felt rich and allowed encounters with people unreachable in Taiwan.
Yet regarding industrial innovation, frankly, deeply disappointing—most narratives were nearly identical to previous years. Many developers told me they found it boring.
Exhibits focused on crypto payments, AI, and DePIN. Several vendors specialized in sports, fan economy, and RWA also attended, alongside many compliance-focused firms. Some projects founded mere months ago directly launched aggressive campaigns at TOKEN2049.
After walking around, my colleague puzzled: Why did Taiwan events hype TON so heavily, yet TOKEN2049 showed almost no TON ecosystem projects or promotion (only Catizen stood out)?
My guess is simple: TON’s visibility in Asia, especially Taiwan, results largely from media amplification, combined with project-KOL matrix systems, creating widespread perception of TON activity. Later, during side events, I asked foreign attendees about TON—many were观望or indifferent. One blunt foreigner replied: “I Don’t Fucking Care about TON!”—confirming my suspicion.
Regarding TOKEN2049’s pricing, it was never meant to attract retail. Most attendees were industry insiders: capital, exchanges, VCs, projects, large-scale KOLs, media. Given terrible market conditions and liquidity over the past year, most people came to do business. For average users, attending held little meaning. Why so many side events? Easy to understand: if projects don’t host events, they struggle to attract funding, users, or partnerships—so many push forward despite challenges, chasing more “deals.”
Theo (Founder, 3rdStCapital): Infrastructure Valuations Still High
1. Everyone is bullish on AI x crypto and hunting great teams to back;
2. Many teams are building the next pump.fun;
3. Most on-chain participants I met are tired of memes and prioritize utility;
4. Teams show interest in MemeFi but fear brand damage. Thus, most don’t plan to build their own;
5. Few high-quality projects available for investment. Many teams build iterations of existing or already-launched products;
6. Project merchandise is under intense scrutiny. People joke that poor swag quality reflects team hardship—teams should pay attention to details at events;
7. Many teams aren’t qualified to host events—their content is hollow;
8. With so many side events, attendees judge you by them. Some teams performed poorly, leaving bad impressions—I won’t name names, as some involve friends’ investments;
8. Infrastructure-layer valuations remain high; ecosystem-layer valuations are lower;
9. Startup teams now struggle to raise funds—VC interest is low. Many are surprised we’re still actively investing;
10. Extremely bullish on Solana. SUI threw a huge party. ETH’s price action made everyone nervous.
Degentrading (KOL): Most Projects Are Boring, Just Burning VC Money
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I spent 99% of my time on one-on-one conversations—far more productive than any event;
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Among all events, Bittensor Asia Meetup was by far the best. I saw real builders in $TAO—that strengthened my belief: this is the AI coin of the cycle;
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Most projects are boring/uninteresting—just burning VC money. Without inflows... founders would quit, tokens might die... If inflows come, maybe they’ll survive a while? Not sure. Either way, I wouldn’t buy these tokens;
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Except for funds that also trade crypto-related stocks, most liquidity funds underperformed Bitcoin;
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Many VCs are genuinely stupid;
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Despite huge marketing budgets, sentiment is low—reminds me of pyramid schemes;
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On $SOL (Solana): I must admit, I deeply respect the Solana ecosystem. Not sure if it can surpass Ethereum, but I believe Solana has a good chance of surviving the token unlock pressure from FTX liquidations... Ethereum influencers seem disconnected from the crowd (maybe because they’re too rich? Who knows, but it’s not good). How much faster is Solana progressing than Ethereum? Five times?
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On Perpetual DEXs: They’ve been neglected lately. I think they’ll revive once Hyperliquid launches;
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On $LDO (Lido): Probably hit rock-bottom sentiment—nobody hates it anymore... Nobody cares. As a bull, I see this positively—can it get worse?
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