The cryptocurrency space has witnessed dramatic shifts in popularity and innovation over the years. On June 16, Compound launched its COMP governance token, priced initially at $18.4 on Uniswap, which skyrocketed to $385—a 21x increase. Similarly, Balancer’s BAL token surged from $0.6 to $22, a 40x jump. Such explosive growth echoes the ICO boom of 2017, where projects like Qtum and GXChain saw comparable rallies.
From 2013’s altcoins to 2017’s ICOs, 2018’s IEOs, 2019’s model coins, and now 2020’s DeFi, each cycle has introduced new trends. But how does the current DeFi-driven governance token wave differ from past frenzies?
Tracing Crypto’s Historical Trends: Patterns and Pitfalls
1. The First Bubble: Altcoins (2013)
The altcoin era revolved around tweaking Bitcoin’s core features:
- Modified block times: From Bitcoin’s 10-minute blocks to 1-minute blocks.
- Adjustable supply: Some abandoned fixed caps for inflationary models.
- Consensus shifts: Experiments with PoS hybrids.
Notable survivors from this era include Dogecoin (DOGE), Ripple (XRP), and Litecoin (LTC). Most altcoins—like BBQCoin or MinCoin ("Hell Coin")—vanished, proving that minor technical tweaks weren’t enough for longevity.
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2. The ICO Craze (2017–2018)
Ethereum’s smart contracts lowered barriers to token creation, spawning absurd concepts like Hero Chain or Space Chain. Projects either:
- Built products (often failing to deliver), or
- Focused on hype—pumping tokens via exchanges and marketing.
While BNB and EOS emerged as successes, 90% of ICOs collapsed, leaving investors with worthless assets.
3. DeFi: The Next Frontier? (2020–Present)
Unlike ICOs, DeFi demands tangible metrics:
- TVL (Total Value Locked)
- User adoption rates
- Revenue-generating mechanisms
Projects like Compound (COMP) and Balancer (BAL) must demonstrate utility beyond whitepapers. However, speculation persists—yield farming and governance token mania mirror past excesses.
Key Takeaway: DeFi’s higher entry barrier filters out some scams, but survivors will likely be few. Investors must decide between short-term trades and long-term bets on protocols with staying power.
FAQs: Understanding Crypto’s Evolutionary Cycles
Q1: What distinguishes DeFi from ICOs?
A: DeFi requires functional products and on-chain data, whereas ICOs often raised funds for untested ideas.
Q2: Which altcoins survived the 2013 wave?
A: Litecoin (LTC) and Ripple (XRP) remain top-10 coins; most others faded into obscurity.
Q3: Why did most ICOs fail?
A: Lack of product-market fit, regulatory pressure, and unsustainable tokenomics led to collapses.
Q4: Is DeFi more sustainable than previous trends?
A: Yes, but only for projects with real revenue streams and scalable use cases.
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Q5: How can investors avoid "dream窒息" (suffocating from hype)?
A: Set clear exit strategies and prioritize projects with transparent metrics over vague promises.
Conclusion: The Cyclical Nature of Crypto Innovation
History shows that each bubble—altcoins, ICOs, or DeFi—leaves behind lessons and a handful of enduring projects. The key is discerning signal from noise. As DeFi matures, its survivors will likely redefine finance, but not without casualties along the way.
Stay vigilant, diversify wisely, and always DYOR (Do Your Own Research).