Odaily News Trader Eugene posted on his personal channel:
In recent years, with the improvement of the regulatory environment, the investment value of DeFi and public chain ecology has gradually become the focus of market attention. However, to invest capital from the perspective of value investment, the following three core conditions must still be met:
1. Priority of token holders: The team must make it clear that token holders are the primary beneficiaries (or at least have equal rights with equity holders). If shareholders can get additional benefits but token holders are not treated equally, then such tokens are not attractive for value investment. This does not mean that the tokens must have immediate direct benefits (such as repurchases or dividends), but the team must maintain a clear and consistent position that token holders are the ultimate beneficiaries of the project.
2. Sustainable business model: The revenue model of the project cannot rely on the speculative cycle of the crypto market. Many so-called "fundamental investors" often make the mistake of basing valuations on short-term trading volume or revenue data. However, in a bear market, trading volume may plummet by 90% or more, making indicators such as price-to-earnings (PE) or price-to-sales (PS) ratios meaningless. In addition, annualized estimates based on single-month peak data are extremely unreasonable.
3. Team execution: Investors need to have confidence in the management team’s execution and believe that they can win the competition through technical barriers or excellent execution capabilities. Any successful business requires a reliable team, and blockchain projects are no exception.
In general, there are only a handful of projects that meet these standards, and investors should make arrangements at the right time. For 99.9% of tokens, the final outcome may just be zero.