When Liquidity Retreats: Who Guards Ethereum's Tower of Babel?
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When Liquidity Retreats: Who Guards Ethereum's Tower of Babel?
In turbulent times, maintaining confidence and optimism is especially important.
Navigating Web3 tides with focused insightsAuthor: Jocy @IOSG
Preface
Recently, the buzz around Consensus HK has gradually cooled, and industry sentiment is generally low. Many believe the market has entered a bear phase. At the same time, the Hong Kong event showcased a carnival of opportunism—P-lords and KOL "gods" took center stage with their relentless focus on trading. In stark contrast, however, the Ethereum ecosystem appears lifeless. Long-term holders are shifting toward Solana, entrepreneurs lack motivation, and short-term traders now dominate. Is this a sign of insufficient crisis awareness within the Ethereum community? The market seems to be sounding the alarm.
The Rise of Short-Termism: The Collapse of Industry Values
When the bull market ends, speculators take over, flooding the industry with ruthless arbitrage. Exchanges lower listing standards, top-tier projects cash out during TGEs, and market makers reap excessive profits—all signs that the industry is shifting from long-term vision to short-lived bubbles. Practitioners, seeing no future, choose to leave; teams committed to building face immense challenges. This myopic behavior not only undermines market confidence but also shakes the very foundation of the industry.
Ethereum's Challenges and Transformation
TL;DR: Founders from Denver infra are pessimistic, while those in applications and AI remain confident.
In Denver, many developers who have been building for years suddenly realized the difficulties in fundraising and the risk of token devaluation. They began re-evaluating Ethereum’s issues and exploring pivots. Some technically oriented founders, tired of building protocols without real end-user demand, have shifted toward AI research. If these core contributors continue to leave, Ethereum’s infrastructure development could regress by three to five years.
The Potential of AI and Web3 Convergence
Although Denver was initially seen as underwhelming, the emergence of more AI*Web3 projects revealed Ethereum’s community actively embracing new technologies. Capital and founders are exploring innovative areas such as DeTraining, Inference, and DePIN. For instance, Paradigm-backed Nous Research and Groq’s success stories show that AI is injecting fresh vitality into Web3.
▲ Openmind’s RobotAI developed with Unitree Technology, and DePAI’s open-source product showcased at Denver
Macro Tailwinds Easing In, Crypto Finds New Opportunities
Unlike Asia, U.S. institutions hold an optimistic view on crypto policy. With banks now allowed to custody crypto assets, lending rates could drop to 3–4%, or even turn negative. Furthermore, giants like Uniswap and Coinbase are designing Tokenized Securities models, aiming to attract more traditional investors into the market.
Rethinking Ethereum Governance: Toward Mainstream and Commercialization
At ETHGlobal in Denver, core Ethereum developers revealed upcoming organizational restructuring plans. @Etherealize will take on the mission of a new-era Consensys, helping Ethereum achieve commercialization. Meanwhile, key members of the foundation are actively exploring sustainable development paths.
▲ Photo from Ethereum’s Beijing hackathon judging day in 2019, with Co-EDs Hsiao-Wei sitting beside Vitalik
Vitalik Should Encourage More Application Entrepreneurs
Today, technological R&D may no longer be as crucial as application innovation. Ethereum needs to produce a once-in-a-generation super app to restore confidence among ecosystem builders. Accumulated capital within the industry should step up, supporting open-source organizations and young founders. Additionally, exchanges could contribute 1–2% of annual revenue each year to support Ethereum’s ecosystem growth.
Ethereum will not die—it is the most successful decentralized organization in the Web3 space. Looking ahead, cherish your Ethereum holdings and evaluate its value and innovation over a ten-year horizon.
In times of turbulence, maintaining confidence and optimism is especially important.
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