Sustainable Crypto Growth: The Necessity of Providing Real Value

According
to
Binance
Research,
the
longevity
and
resilience
of
crypto
projects
depend
significantly
on
their
ability
to
offer
real
value
to
users.
Short-term
interest
driven
by
narratives,
sentiment,
and
hype
may
boost
initial
engagement,
but
these
factors
alone
are
insufficient
for
long-term
growth,
especially
in
bear
markets.

The
Current
Situation

Many
projects
have
successfully
captured
attention
by
leveraging
popular
trends
such
as
artificial
intelligence
and
restaking.
However,
some
have
struggled
to
maintain
momentum
as
user
interest
wanes
over
time.
Projects
that
rely
heavily
on
extrinsic
rewards,
such
as
points
systems
or
airdrop
promises,
often
fail
to
foster
long-term
commitment.
Once
these
incentives
end,
users
typically
migrate,
having
no
intrinsic
reason
to
stay.

This
trend
highlights
the
importance
of
providing
intrinsic
and
tangible
value
to
sustain
user
engagement
beyond
initial
hype.
Projects
that
focus
on
real
value
tend
to
do
better,
as
they
can
maintain
a
base
level
of
activity
regardless
of
market
conditions.

Focus
on
Providing
Real
Value

To
achieve
sustainable
growth,
projects
must
deliver
real
value
through
tangible
benefits
like
strong
use
cases
and
sustainable
yields.
This
approach
keeps
users
engaged
beyond
initial
hype
and
fosters
loyalty.
According
to
the
report,
real
value
can
be
provided
in
three
main
ways:
real
demand,
real
revenue,
and
real
yields.

1.
Real
Demand

Real
demand
is
demonstrated
by
users’
willingness
to
use
and
pay
for
products
or
services
without
relying
on
extrinsic
rewards.
Achieving
a
strong
product-market
fit
creates
intrinsic
demand,
enabling
projects
to
generate
enduring
revenue.
Examples
of
sectors
with
real
demand
include
decentralized
exchanges
(DEXes),
liquid
staking,
money
markets,
and
stablecoins.

2.
Real
Revenue
and
Profit

Real
revenue
refers
to
tangible
income
generated
by
a
project,
often
from
protocol
fees.
When
combined
with
healthy
tokenomics
and
low
operating
expenses,
projects
can
achieve
operational
profitability.
Profitability
is
calculated
by
subtracting
operating
expenses
and
token
emissions
from
total
revenue.
Leading
protocols
in
terms
of
profitability
include
Tron,
Maker,
and
Uniswap.

3.
Real
Yield

Real
yields
are
generated
from
tangible
sources
of
revenue
and
are
not
solely
reliant
on
inflationary
token
emissions.
This
functions
similarly
to
dividends
in
traditional
finance,
providing
returns
to
token
holders.
Examples
include
DEXes
that
provide
yield
to
liquidity
providers
derived
from
transaction
fees
and
liquid
staking
protocols
that
distribute
yields
from
staking
rewards.

Projects
that
provide
real
value
by
demonstrating
strong
product-market
fit,
consistent
revenue
growth,
and
real
yield
have
a
higher
probability
of
withstanding
market
cycles.
In
contrast,
projects
driven
by
fleeting
trends
or
speculative
interest
may
experience
rapid
initial
growth
but
often
lack
the
foundational
elements
needed
for
sustainability.

For
more
detailed
insights,
refer
to
the
original
report
by
Binance
Research

here.

Image
source:
Shutterstock