1. Introduction

it’s not only the phenomena of VC coins and meme coins that have sparked deeper reflection in the crypto space; many well-known figures in the industry have raised similar questions and are actively seeking solutions. For example, during a Twitter Space discussion about “girlfriend coins,” Jason Chen (Chen Jian) asked whether Binance’s listed tokens have mechanisms in place to prevent project teams from dumping tokens and walking away. Recently, CZ’s article “A Crazy Idea for Token Issuance” also attempts to address these issues.

I believe that all teams genuinely working on meaningful projects hope that the market will reward real contributors — rather than allow Ponzi schemes, scammers, and pure speculators to take the industry’s profits and disrupt healthy development.

Since VC coins and meme coins offer excellent case studies, this article will focus on analyzing these two phenomena.

2. The past and present of VC coins

VC coins are not created out of thin air. There are historical reasons for their emergence. Although VC coins may not seem perfect now, they also played a relatively important role at the beginning, and important projects in the industry have the participation of VCs.

2.1. The ICO Mania of 2017: A Frenzy

VC coins didn’t appear out of thin air. Their emergence has historical reasons. Although they now seem flawed, they once played an important role, with most major projects in the space having VC involvement.

The year 2017 was a critical one for Initial Coin Offerings (ICOs), with more than $5 billion raised through ICOs. Aside from the classic ICO projects discussed below, I personally participated in a few small ICO projects and experienced firsthand how wild the market was — describing it as “chaotic frenzy” is not an exaggeration. At that time, if a token was about to conduct an ICO, had some celebrity endorsement, and a decent whitepaper, it would get snapped up as soon as it was announced in any chat group. People were irrationally crazy. Exaggerating a little, even if you threw a pile of garbage into a group and called it a token, it would probably still be bought. (For proof, look up the story of MLGB — “Ma Le Ge Coin.”)

The reasons for this explosion, as summarized from conversations with DeepSeek, ChatGPT, and my own understanding, are:

(1) The technology for token issuance had matured: Especially after Ethereum’s launch, it became easy for developers to create smart contracts and decentralized applications (DApps), fueling the ICO boom.

(2) Additional factors: Market demand, the growing popularity of decentralization ideals, investor expectations of massive returns, and the low barrier to entry.

Some iconic cases include:

Ethereum (ETH): While Ethereum’s ICO was in 2014, by 2017, its smart contract platform became the foundation for most ICOs. Ethereum itself was launched through an ICO and has since grown into the second-largest crypto project.

EOS: Conducted a year-long ICO in 2017, raising nearly $4.3 billion — one of the largest ICOs in history. However, the project has since faded from prominence, partly due to poor technical decisions and inadequate market understanding.

TRON: Also raised large amounts during its 2017 ICO, amidst controversy over plagiarism and token swaps. Yet, it developed quickly and met market demands well — in contrast to EOS. The success of TRON and its stablecoin business shows Justin Sun’s keen market sense.

Filecoin: Raised over $250 million in its 2017 ICO with strong backing. While it’s neither a clear success nor failure, its long-term sustainability remains uncertain.

Aside from these examples, many non-classic projects created larger problems, contributing to the historical context in which VC coins later emerged.

Key problems exposed by the ICO era:

(1) Lack of regulation: The rapid development of ICOs led to rampant fraud and Ponzi schemes. An estimated 99% of projects were either exaggerated or outright scams.

(2) Market bubbles: Massive amounts of capital were raised without effective management, causing most projects — even those with good intentions — to fail or exit prematurely.

(3) Investor education gap: Most retail investors lacked the ability to evaluate projects or supervise teams post-investment.

2.2. VC entry and credibility endorsement

Through the above description, we can see the chaos after ICO. At this time, venture capital (VC) first stepped forward to solve the problem. VC provided more reliable support for the project through its own reputation and resources, helping to reduce many problems caused by early ICO. At the same time, an additional effect is to help the majority of users perform a layer of screening.

The role of VC

(1) Alternative to the grassroots financing shortcomings of ICO

• Reduce the risk of fraud: VC through “Rigorous due diligence”(Team background, technical feasibility, economic model) Filter “air projects” to avoid the proliferation of white paper fraud in the ICO era.

• Standardized fund management: Phased capital injection (allocation based on milestones) and token lock-up period terms are adopted to prevent the team from cashing out and running away.

• Long-term value binding: VCs usually hold project equity or long-term lock-up tokens, which are deeply tied to project development and reduce short-term speculation.

(2) Empowering project ecology

• Resource import: Connect the project with key resources such as exchanges, developer communities, and compliance consultants (such as Coinbase Ventures to help the project list currency).

• Strategic guidance: Assist in designing token economic models (such as token release mechanisms) and governance structures to avoid the collapse of the economic system.

• Credibility endorsement: The brand effect of well-known VCs (such as a16z, Paradigm) can enhance the market’s trust in the project.

(3) Promote industry compliance

VC promotes projects to proactively comply with securities laws (such as the U.S. Howey Test) and adopt compliance financing frameworks such as SAFT (Simple Agreement for Future Tokens) to reduce legal risks.

The involvement of VC is the most direct solution to the problems of the early ICO model. Overall, VCs played a crucial role in the success of the Web3 project. Through funds, resources, reputation and strategic guidance, they helped the project overcome many challenges faced by early ICOs and indirectly helped the public complete the initial screening.

2.3. Problems with VC coins

The emergence of new things is to solve some old problems, but when this new thing develops to a certain stage, it itself begins to present a series of problems. VC coin is such a case, and it showed many limitations in the later period.

Mainly reflected in:

(1) Conflict of interest

VC is an investment institution that makes profits through investment. It may promote over-tokenization of projects (such as high unlocking selling pressure) or prioritize serving its own investment portfolio (such as exchange VC supporting “biological” projects).

(2) Inability to solve subsequent project development problems.

(3) Conspired with project parties to deceive retail investors (some project parties and VCs operate this way, and VCs of big brands are relatively good).

VC institutions only complete the early stages of investment and profit-making exit. On the one hand, they have no obligation for the later development of the project, and on the other hand, they have no ability or willingness to do so. (Would it be better if we limited the long unlocking period of VC?)

The main problem with VC coins is that after the project team’s currency is listed, it lacks the motivation to continue construction. Both VC and project parties will cash out and run away after listing the currency. This phenomenon makes retail investors hate VC coins, butThe essential reason is still the lack of effective supervision and management of projects, especially the matching of funds and results.

3. Fair Launch Inscriptions and the Meme Coin Phenomenon

Inscription and Fairlanunch, which broke out in 2023, and the pumpfun model of memecoin, which broke out in 2024, have revealed some phenomena and exposed some problems.

3.1. The outbreak of inscriptions and Fairlanunch

In 2023, two trends dominated the crypto space: the rise of Inscriptions (on-chain token metadata) and the popularity of the Fair Launch model. Both emerged from dissatisfaction with ICOs and VC dominance. Notably, many VCs complained that they had no opportunity to participate in inscription projects at the primary market stage, and even at the secondary market, investments were extremely risky. This reflects the community’s desire for decentralization and fairness.

Inscriptions first gained traction on Bitcoin, with the BRC-20 standard leading to tokens like ORDI and SATS.

Reasons for their rise:

• The Bitcoin ecosystem’s need for innovation.
• Demand for censorship resistance and decentralization.
• Low barriers to participation and potential for wealth creation.
• Rebellion against VC-dominated projects.
• The appeal of fair launches.

Problems with inscriptions:

• Pseudo-fairness: Many addresses are controlled by a few whales or disguised institutional players.
• Liquidity challenges: High transaction fees and slow transaction times on Bitcoin’s mainnet.
• Value leakage: High gas fees paid to miners do not flow back into the project ecosystem.
• Lack of application scenarios: Most inscriptions lack utility beyond speculation.

3.2. The Rise of Pump.fun and Meme Coin Mania

Meme culture started long ago — originally as a cultural phenomenon. In crypto, it gained traction through early NFT projects, such as the 2014 creation of Rare Pepes on Counterparty. Meme coins are an extension of this culture.

In 2024, Pump.fun, built on Solana, became the key platform for meme coin launches. The platform’s simplicity and closed-loop process — token issuance + liquidity pool creation + decentralized exchange (DEX) listing — fueled meme coin speculation.

Pump.fun’s key contribution:

It combined previously separate services (token issuance, liquidity provision, and DEX trading) into a seamless, single platform, making it easy to launch and trade meme coins rapidly.

In the early days, the proportion of tokens on Pump.fun that successfully launched on a DEX — commonly referred to in the industry as the “graduation rate” — was very low, only around 2% to 3%. This indicates that, at that stage, the entertainment function outweighed the trading function, which is in line with the nature of memes. However, during the peak periods, the graduation rate often exceeded 20%, turning into a purely speculative machine.

An analysis shared on Twitter also illustrates the inherent problems of the memecoin model (although I have not personally verified the reliability of this data).

Pump.fun’s total revenue has reached nearly $600 million, to the point where even U.S. President Trump and his family issued their own tokens — a clear indication of the explosive growth and peak frenzy of the memecoin market. According to analysis from Dune, memecoins are also going through a familiar cycle: from creation, to growth, and ultimately to an explosive phase.

The Main Problems with Memecoins

• Systemic Fraud and Collapse of Trust: According to Dune data, around 85% of tokens launched on Pump.fun are scams, with founders cashing out on average within just 2 hours.

• Rampant False Advertising: Project teams frequently forge endorsements from well-known KOLs and fake trading volumes (using wash-trading bots). For example, the MOON token claimed to have Elon Musk’s endorsement, which was actually fabricated with Photoshop.

• Distorted Market Ecosystem: Memecoins create a liquidity siphon effect, consuming large amounts of on-chain resources and squeezing out room for legitimate projects to grow. For instance, the TVL (Total Value Locked) of DeFi protocols on the Solana chain has dropped by 30%. This environment drives away real users, as ordinary investors are unable to compete with bots and insider trading, gradually pushing them out of the market. There are even reports of project teams using raised funds to manipulate memecoins for arbitrage and then disappearing.

Memecoins have evolved from early-stage entertainment products into mid-to-late-stage PVP (Player vs. Player) environments, and ultimately into PVB (Player vs. Bot) arenas — tools for a small group of experts to profit at the expense of retail investors. The absence of meaningful value injection into memecoins remains a critical issue, and without addressing this, memecoins are destined to decline.

4. What kind of projects do users or the market actually want?

By reviewing the development history of Web3 projects, we’ve understood the historical reasons behind the emergence of VC-backed tokens (VC coins), their pros and cons, and also briefly analyzed the phenomena of inscriptions and memecoins driven by platforms like Pump.fun. These trends are all products of the industry’s evolution. Through this analysis, we can see that there are still some fundamental problems in current Web3 project development.

Note: Do VC coins and memecoins reveal all the problems, or at least the key current problems?

4.1. Summary of existing problems

Based on the analysis so far, the current key problems for Web3 projects are:

1. Sustainable Building Incentives:

Projects must maintain long-term development motivation. No party should receive excessive funds too early. Token holders and future contributors need continuous rewards — instead of becoming targets of exploitation and deceit.

1. Reducing or Eliminating PVP (Player vs. Player) Dynamics:

Much of the market still revolves around zero-sum games. A fair launch model is more appealing because it reduces the power of “whales” or manipulators. However, even with a fair launch, post-DEX listing still becomes a race, where early entrants profit more due to fixed pool values.

How can these problems be addressed?

1.Project Management Structure:

Prevent project teams or VC investors from obtaining large amounts of funds too early. Alternatively, ensure funds are only accessed under regulated conditions or are allocated in a way that continuously rewards contributors and builders.

2.Sustainable External Value Injection:

This is key to solving the PVP problem. Sustainable external value inflows can reward medium- and long-term token holders and builders, giving project teams real support for ongoing development. It also helps build long-term growth expectations for holders and reduces early cash-out and rug-pull scenarios.

These conclusions, while simple on the surface, require a deeper explanation. Project management problems can’t be separated from the analysis of stakeholders in the ecosystem, and should be studied across different project stages (issuance, circulation, governance) to identify and address issues dynamically.

4.2. Management issues of different stakeholders and different links of the project

1.Different stakeholders

In Web3 projects, the part most closely related to interests is the design of the economic model. The stakeholders in a project generally include the project team, investors, the foundation, users and community, miners, exchanges, market makers, or other participating parties in the project ecosystem. The economic model needs to plan token allocation and contribution incentives for different stakeholders at various stages. The economic model generally includes the token distribution proportion for stakeholders, the token release rules, and incentive methods. The specific proportions and release rules are determined based on each project’s actual situation and the level of contribution from each party, with no fixed numbers. Outside the project, there is also a group of bystanders (speculators, airdrop hunters, scammers, and so on).

Among different stakeholder groups, it is necessary to prevent any party within the ecosystem from taking away excessive profits. For example, in VC coin projects, the project team and investors take most of the token value, resulting in a lack of continuous motivation for future development. At the same time, it is also important to prevent external groups, such as speculators in memecoins, from obtaining improper benefits.

Analyzing problems from multiple stages, including issuance, circulation, and governance.

(1) Token issuance

There are various ways to issue digital currencies. In addition to mining through PoW, there are methods such as ICO, STO, IBO, and various forms of airdrops like those used by Ripple. Regardless of the method, the main purposes of digital currency issuance are twofold: first, to raise funds; second, to distribute digital currency into the hands of users, enabling more people to use it.

(2) Token circulation and management

Compared to the early days of Web3 projects, token issuance now has various methods, resulting in a large volume of digital currencies entering circulation. Due to insufficient demand and limited tools for managing token liquidity, many issues arise in the circulation stage. The management of tokens is often achieved through the provision of various applications. For example, token trading functions, token staking, membership entry thresholds (based on the number of tokens or the holding of NFTs), and consumption within applications (such as gas fees on public chains, ENS registration fees, and renewal costs).

Tokens released too early in a project, which refers to the portion between the red line and the green line, need to be subject to liquidity lock-up mechanisms to prevent any stakeholder from taking them in advance. These locked tokens, along with the project’s progress during the construction period, involve management issues.

(3) Governance issues of the project

In Web3 projects, the most direct control is achieved through the design of consensus mechanisms and economic models. Tokens in the economic model are used to control the supply and consumption of resources. The design of the economic model plays a significant role in Web3 projects, but its scope of effectiveness is limited. When the economic model cannot fully handle certain functions, areas beyond its reach need to be supplemented by other means. Community governance mechanisms serve as a functional supplement for areas where the economic model is less effective.

Due to the decentralized nature of the blockchain world and its reliance on programmable rules, community organizations such as DAOs and DACs have emerged, which can be compared to the centralized structures of traditional companies and corporate governance in the real world.

This form of management, combining DAO and foundation models, can better achieve the management of funds and the ecosystem while also providing enough flexibility and transparency. The management members of a DAO need to meet certain conditions and should include key stakeholders and third-party institutions as soon as possible. If exchanges that list tokens are considered third-party participants, can this align with Jason’s suggestion that exchanges should have certain supervisory and notary rights and roles? In fact, during the recent market manipulation incident involving GoPlus and Myshell’s market makers, Binance played this kind of role.

Could this type of management structure also help better implement the model proposed by CZ in his article “A Crazy Idea for Token Issuance”? We will use the governance concept outlined in CZ’s article as an example for analysis, as shown in the diagram below:

(1) Initially, 10% of the tokens are unlocked and sold on the market. The proceeds will be used by the project team for product/platform development, marketing, salaries, and other expenses. (This design is good, but who will handle the management and supervision? Would it be better to entrust this part of the work to the project’s DAO organization, using a treasury system combined with third-party supervision?)

(2) Each future unlocking must be subject to several conditions that need to be evaluated. (This design targets the continuous work and token liquidity management after the initial period. If this responsibility is handed over to DAO management, the results could also be better.)

(3) The project team has the right to postpone or reduce the scale of each unlocking. If they do not want to sell more, they are not obligated to do so. However, each time they can sell (unlock) up to 5%, and then they must wait at least six months until the price doubles again. (This design must be executed by a third-party institution such as a DAO, turning the project team’s authority into a decision made by the DAO. Since the project team is also an important member of the DAO, this should not result in excessive side effects.)

(4) The project team does not have the authority to shorten or increase the scale of the next unlocking. Tokens should be locked in a smart contract with keys controlled by a third party. This prevents new tokens from flooding the market during price downturns and also incentivizes the project team for long-term development. (This design further illustrates the need for a third-party institution, which would offer better controllability and governance compared to a smart contract alone. In fact, CZ has subconsciously proposed the idea of a DAO in this framework.)

Of course, this is just a case study. Real project governance involves many other aspects. With the development of Web3 to this point, such frameworks will gradually be refined and expanded in implementation, with continuous corrections in practice and the discovery of better methods.

4.3. How to build long-term project development (value capture and value injection)

Without the support of technological and application innovation, the current projects in the industry relying on hype and promotion will not last long. In the end, the issues of VC tokens and meme tokens will reoccur. In fact, Pumpfun has provided a framework that can be used for reference. Its rise and subsequent decline were due to the absence of one crucial element: token empowerment (also referred to as value capture and value injection), as illustrated in the diagram below.

Based on the diagram above, we can see that after VC tokens are listed on exchanges, the project team receives substantial returns and therefore loses motivation for continued development. The reason is that later-stage development carries significant risks and does not offer sufficient rewards — doing nothing becomes the best choice. However, there are still some capable and idealistic teams that continue building, though they are few in number. The memecoin model of Pumpfun inherently lacked token empowerment in later stages, so it became a race of who could cash out faster. Why can certain memecoins like Dogecoin continue to rise in value? The author believes there are multiple reasons, which will be discussed in depth on another occasion.

How can long-term value injection be achieved? What are the ways to empower tokens?

Looking back at previous Web3 project cases, for example, how DeFi protocols captured value through liquidity mining, how NFT projects injected external value through royalty mechanisms, or how DAOs accumulated value through community contributions. As Web3 technology matures, more “application scenarios” will emerge, resulting in more points of value integration.

Value capture and external value injection are the two pillars of the Web3 economic model: the former focuses on retention, while the latter focuses on inflow. Popular terms like “value accrual” and “flywheel effect” better express the dynamic combination of the two, while “token empowerment” and “positive externalities” approach the concept from a functional design perspective.

The core challenge is to balance short-term incentives with long-term value and to avoid falling into “paper models” and Ponzi schemes.

5. Analysis of the First Two Crypto Bull Markets and the Potential for the Next Explosion

The earlier content analyzed the problems existing in the VC token and memecoin models currently attracting industry attention. Would solving these issues drive the next bull market? First, let’s review the two bull markets of 2017 and 2021.

Note: The following content is partly based on research from online sources, insights from exchanges with DeepSeek and ChatGPT, and partly from the author’s personal experience during the 2017 and 2021 bull markets. Additionally, our team is currently developing products related to the Bitcoin ecosystem, so this article includes personal reflections and judgments.

5.1. The ICO Frenzy of 2017

The 2017 bull market in the blockchain field was the result of multiple factors working together — technological breakthroughs, ecosystem development, and external macro factors. According to professional industry analyses and classic literature, the key reasons are summarized as follows:

(1) The ICO (Initial Coin Offering) boom

Ethereum’s ERC-20 standard significantly lowered the barrier to token issuance. Numerous projects raised funds through ICOs, with over $5 billion raised throughout the year.

(2) Bitcoin forks and scaling debates

Disputes in the Bitcoin community over scaling solutions (SegWit vs. big blocks) led to forks. In August 2017, the Bitcoin Cash (BCH) fork occurred, sparking market attention on Bitcoin’s scarcity and technical evolution. BTC’s price surged from $1,000 at the beginning of the year to a historical peak of $19,783 in December.

(3) The rise of Ethereum’s smart contract ecosystem

Smart contract and DApp development tools matured, attracting developers en masse. The concept of decentralized finance (DeFi) began to take shape, with early DApps like CryptoKitties driving user participation.

(4) Global liquidity easing and regulatory gaps

Global low-interest-rate policies in 2017 drove capital to seek high-risk, high-return assets. Regulation of ICOs and cryptocurrencies was not yet in place in most countries, allowing speculative activities to flourish unchecked.

The 2017 bull market laid the foundation for the industry by establishing infrastructure (such as wallets and exchanges), attracting technical talent, and bringing in more new users. However, it also exposed issues like ICO fraud and lack of regulation, which prompted the industry to shift towards compliance and technological innovation (such as DeFi and NFTs) after 2018.

5.2. The DeFi Summer in 2021

The 2021 bull market in the blockchain space was the result of multiple factors resonating together, including ecosystem development, macroeconomic conditions, technological innovation, and institutional participation. According to professional industry analysis and classic literature, the reasons can be summarized as follows:

(1) The explosion and maturity of DeFi (Decentralized Finance)

The maturation of Ethereum smart contracts and the launch of Layer 2 scaling solutions (such as Optimism and Arbitrum) reduced transaction costs and latency. This triggered an explosion in applications: the total value locked (TVL) in DeFi protocols such as Uniswap V3, Aave, and Compound grew from $1.8 billion at the beginning of the year to $25 billion by year-end, attracting large amounts of capital and developers.

Yield farming: High annual percentage yields (APY) attracted retail and institutional arbitrage capital. At that time, YF (Yearn Finance, commonly referred to in the industry as “Dai Fu”) was once priced higher than BTC.

(2) The mainstream breakthrough of NFTs (Non-Fungible Tokens)

Beeple’s NFT work “Everydays: The First 5000 Days” was auctioned for $69 million at Christie’s. NFT projects like CryptoPunks and Bored Ape Yacht Club (BAYC) reached valuations exceeding $10 billion. NFT trading platforms such as Opensea rose to prominence.

(3) Large-scale institutional capital entry

Tesla announced the purchase of $1.5 billion worth of Bitcoin and acceptance of BTC payments.

MicroStrategy continued to accumulate Bitcoin (holding 124,000 BTC by the end of 2021).

Canada approved its first Bitcoin ETF (Purpose Bitcoin ETF in February 2021).

Coinbase went public via a direct listing on NASDAQ with a valuation of $86 billion.

(4) Global macroeconomics and monetary policy

Excessive liquidity: The Federal Reserve maintained zero interest rates and quantitative easing policies, leading capital to flood into high-risk assets.

Inflation expectations: The U.S. Consumer Price Index (CPI) year-on-year increase exceeded 7%, and Bitcoin was viewed by some investors as “digital gold” to hedge against inflation.

(5) Increased mainstream acceptance

Expansion of payment scenarios: PayPal enabled cryptocurrency buying and selling for users, and Visa allowed settlements using USDC.

El Salvador adopted Bitcoin as legal tender (September 2021).

Celebrity effect: Public figures like Elon Musk and Snoop Dogg frequently mentioned cryptocurrencies and NFTs.

(6) Competition and innovation in multi-chain ecosystems

The rise of new public blockchains: High-performance chains such as Solana, Avalanche, and Polygon attracted users and developers due to low fees and high transactions per second (TPS).

Breakthroughs in cross-chain technology: Cross-chain protocols from Cosmos and Polkadot advanced asset interoperability.

(7) Meme coins and community culture

Phenomenal projects: Dogecoin (DOGE) and Shiba Inu (SHIB) soared due to social media hype (DOGE saw annual gains of over 12,000%).

Retail investor frenzy: The Reddit forum WallStreetBets (WSB) and TikTok drove waves of retail investors into the market.

Impact on the subsequent market

The 2021 bull market accelerated the institutionalization, regulatory compliance, and technological diversification of the cryptocurrency industry, but it also exposed issues like DeFi hacks and NFT market bubbles. Following this, the industry’s focus shifted toward:

Regulatory compliance: The U.S. SEC increased scrutiny on stablecoins and tokenized securities.

Sustainability: Ethereum transitioned to Proof of Stake (the Merge plan), and Bitcoin mining began exploring clean energy solutions.

Web3 narratives: Concepts such as the metaverse and DAOs (Decentralized Autonomous Organizations) became new areas of focus.

5.3. When will the next bull market happen? 2025? What will the theme be?

The following is a predictive analysis of the potential driving factors for a cryptocurrency bull market in 2025, combined with current industry trends, technological innovation, and macroeconomic background. According to professional analysis within the industry and classic literature, the reasons are roughly summarized as follows:

(1) Large-scale Web3 applications and the rise of user sovereignty

Real-world applications: Decentralized social networks (such as Nostr, Lens Protocol), on-chain games (AAA-level GameFi), and decentralized identity (DID) become mainstream, overturning traditional internet models of user data ownership and profit distribution.

Key events: Tech giants like Meta and Google integrate blockchain technology, enabling cross-platform migration of user data.

Related technologies: The maturation of zero-knowledge proofs (ZKP) and fully homomorphic encryption (FHE) ensures privacy and compliance.

(2) Deep integration of AI and blockchain

Decentralized AI networks: Blockchain-based computing power markets (such as Render Network) and AI model training data ownership confirmation (such as Ocean Protocol) solve the monopoly problem of centralized AI.

Autonomous agent economy: AI-driven DAOs (such as AutoGPT) automatically execute on-chain transactions and governance, improving efficiency and creating new economic models.

(3) Interoperability between global central bank digital currencies (CBDCs) and stablecoins

Policy push: Major economies launch CBDCs (such as the digital euro and digital dollar), forming hybrid payment networks with compliant stablecoins (such as USDC and EUROe).

Cross-chain settlement: The Bank for International Settlements (BIS) leads the establishment of CBDC interoperability protocols, with cryptocurrencies becoming a key component in cross-border payment channels.

(4) Bitcoin ecosystem revival and Layer 2 innovation

Bitcoin Layer 2 explosion: The continuous growth of Lightning Network capacity, the emergence of the TaprootAssets protocol, and the RGB protocol supporting the issuance of assets on the Bitcoin chain. The Stacks ecosystem introduces smart contract functionality.

Institutional custody upgrade: BlackRock and Fidelity launch Bitcoin ETF options and collateral lending services, unlocking the financial tool attributes of Bitcoin.

(5) Clear regulatory frameworks and full institutional participation

Global compliance: The U.S. and Europe pass regulations similar to the Markets in Crypto-Assets (MiCA) Act, clarifying token classifications and exchange licensing systems.

Traditional financial integration: JPMorgan and Goldman Sachs launch crypto derivatives and structured products. Pension funds allocate more than 2% of portfolios to cryptocurrencies.

(6) Geopolitical conflict and de-dollarization narrative

Hedge demand: The escalation of geopolitical risks such as the Russia–Ukraine conflict and the Taiwan Strait situation lead to cryptocurrencies becoming neutral settlement tools.

Diversified reserve assets: BRICS countries jointly issue blockchain-based trade settlement tokens, and some national bonds are denominated in Bitcoin.

(7) Meme culture 3.0 and community DAO evolution

Next-generation meme coins: Meme projects combined with AI-generated content (AIGC) and dynamic NFTs (such as AI-driven “immortal dog” characters), with the community deciding IP development directions through DAO voting.

Fan economy on-chain transformation: Top-tier celebrities like Taylor Swift and BTS issue fan tokens, unlocking exclusive content and participating in profit sharing.

Note: To avoid missing any related possibilities, the above analysis material has been preserved in detail.

Through summarizing the 2017 and 2021 bull markets and analyzing the potential for 2025, we can roughly refer to the diagram below for some judgment.

For the pattern:

The inscription in 2023 and the pumpfun phenomenon in 2024 are some of the phenomena that may lead to a bull run. If the problems of inscription and pumpfun itself can be solved and a more complete model is produced, it may lead to the outbreak of the bull market in some areas. There is a high probability that it is still related to issuing assets and trading assets.

For fields:

Roughly produced in two fields:

(1) Pure Web3 realm

(2) The combination of AI and web3

Detailed Analysis:

(1) Large-scale Web3 applications and the rise of user sovereignty:

In my personal opinion, the infrastructure is still not sufficiently mature, and the wealth effect is not yet strong enough. It’s difficult for this to independently become the main driving factor or sector for the next bull market—or at least not the core factor this time.

(2) Deep integration of AI and Web3:

Everyone has witnessed the power of AI. Could this sector become the pillar of the next bull market? It’s indeed hard to predict… Personally, I lean toward the view that it’s still a bit early. But this sector is unpredictable—phenomena like DeepSeek and Manus exploding in popularity are not surprising in the AI world. What will DeFi empowered by AI look like? It’s an open question.

(4) Bitcoin ecosystem revival and Layer 2 innovation:

Bitcoin performed well in both the 2017 and 2021 bull markets. Currently, Bitcoin’s market cap accounts for 60% of the entire crypto market, and the wealth effect is strong enough. If this sector sees good models combined with strong technical execution, the probability of triggering a bull market is very high.

(7) Meme Culture 3.0 and DAO-ification:

If meme culture can solve the PVP (player-versus-player) zero-sum issue and achieve continuous external value injection, could it become a driving factor for the next bull market? Judging from the wealth-effect perspective, this would be quite difficult.

As for (3), (5), and (6) — these factors are likely to accelerate developments and add fuel to the fire, but on their own, they’re not strong enough to directly spark a bull market.

If 2025 turns out to be a bull market, the most likely drivers will be:

• The Bitcoin ecosystem and Layer 2 innovations, with new models emerging from asset issuance and trading.

• The intersection of AI and Web3, particularly AI-powered trading models.

In addition to analyzing sectors and models, the actual timing of a bull market breakout will largely depend on external macro factors.

All of the above are purely personal thoughts and do not constitute any investment advice.

Disclaimer:

1. This article is reprinted from [TechFlow]. The copyright belongs to the original author [Fu Shaoqing, SatoshiLab, BTC Studio of Everything Island]. If there are any objections to this reprint, please contact the Gate Learn team, and we will handle it promptly in accordance with relevant procedures.
2. Disclaimer: The views and opinions expressed in this article are solely those of the author and do not constitute any investment advice.
3. Other language versions of this article have been translated by the Gate Learn team. Without mentioning Gate.io, it is prohibited to copy, distribute, or plagiarize the translated content.