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It's all about treasury management

Just a quick blurb of what I was talking to on stage at the AIBC conference in Manila last week.

I was asked what makes web3 projects, and over the past year, many facts have came to enlighten me that treasury management is the only thing that can save a project for certain failure.

Forbes recently published an article of their top 20 zombie chains.

Sadly no one use blockchain tech, well almost no one. There is only a handful of protocol that generate enough fees to sustain themselves. Most of them collect less fee the the cost of a full time developer... So why the hell would anyone spend millions on building tech that no one use? For the most part because it's an attention grabber, you are tickling the imaginary of speculators, and if you have 1% or less of real users but you have thousands of speculators you can have a short lived token economy.

Fortunately, some projects seems to be great at managing their treasury such that they are able to generate significant returns to sustain their team and keep the dream alive and even buy back their token from certain collapse.

Why spend millions on marketing when the best marketing is your price chart, make it attractive to traders by using your treasury to engineer your price chart to look attractive and regardless of your tech, you can get decent financial sustainability.

Overall, this beg the question why build tech at all? It can be content, it can be anything that drive attention really, but I would recommend to spend as little as possible on marketing and as little as possible on development, and focus entirely on treasury management. Then, from the excess liquidity/profits generated, you can spend a bit on side activities to keep the imagination running.

This is inline with meme coins, I think the future of blockchain will be community-powered token economies. Wether those are meme coins or not is irrelevant, it can be any cause, content, joke, tech that drive attention and word of mouth.

If you accept these facts, then instead of relying on 1% of your community as being real users, you can have 100% of your community being real users... meaning your community are all speculators but your product is tailored to service these speculators... meaning don't spend millions building tech that 15 users a day will use... (aka. Cardano...)

The implication of this is that no project should outsource market making to another entity, all of them should license existing tech and hire internal teams or train their staff to handle their market making internally which has to be entirely aligned with treasury management of other unrelated assets. If you have a solid team member with this skill, I believe even if you have a community of 10 users, you will eventually grow organically into billions of dollars of asset under management (AUM) and a community of hundreds of thousands because very few crypto projects are doing this well or even accept this fact. Show Less


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