This is an observation and personal opinion from BonnaZhu of Nothing Research Partner. The following content does not constitute any investment advice.
Earning points through Yap and then redeeming those points for new project allocations instantly brings people back to the ICO craze of 2017 and 2018—writing articles and making videos for projects, and then using the results to negotiate whitelist spots with project teams.
1. An alternative mining model of 'contribution = reward'
Unlike the closed-door situations that may have been encountered in the past, Virtuals Protocol standardizes the 'contribution = reward' mechanism through Kaito AI, ensuring that the efforts of community users are recognized.
Due to the limited points available at the same time, users need to carefully plan and choose their investment targets. The actual investment amount for each project is usually only a few to dozens of dollars, but the potential returns can reach dozens of times, giving users a kind of 'scratch card' thrill of betting small amounts for big gains, and attracting more and more users to participate. This is probably why Virtuals has been gaining more and more attention recently.
2. But is Virtuals' mechanism perfect?
Not necessarily.
1) The existence of penalties for paper hands means that most people treat projects with low market values post-launch as mere stepping stones for brushing points. The potential returns of dozens of times often remain on paper, making them hesitant to act rashly.
2) Overemphasizing proof of work, mainly through trading and staking tokens, while bringing transaction fee sharing to projects and reducing token circulation, will make ordinary users feel increasingly helpless in front of studios that gain advantages over time, gradually getting 'trapped' in this repetitive point-hunting system. Projects on the platform, especially small to medium-sized projects, can easily become zombie projects without sufficient trading and turnover.
Is this healthy? In my view, it definitely is not in the long term.
But in the short term, it is indeed a helpless move.
If most projects will eventually go to zero, then rather than binding users with paper hand penalties in a serious manner, it is better to let the market play freely, allowing survival of the fittest. If one must sell, then sell; garbage projects cannot pretend for long, and good projects that people want to hold will not be sold even without paper hand penalties. The market is always the best filter.
3. The ability to select users is the core.
The launchpad sector has gone through so many years of development, from the early ICOs of 2017-2018, to the IEOs of 2019-2020, to various DEX launches starting in 2021, and now to this round of Fair Launch. Each round of the popularity of launch platforms actually followed the trend of new asset issuance IPO models and the overflow of liquidity, but in the past, when the tide receded, the development of platforms was greatly affected.
Compared to the innovation of the 'art' of IPO models, what I hope to see more is that Launchpads can focus on user selection. Because in my view, the real value of non-exchange launch platforms (which have direct liquidity endorsements) should be to help projects distribute tokens to the most suitable individuals, and this should not be limited to:
- Traders, stakers, or Yapers on the platform.
- Of course, it should not focus solely on providing benefits to platform token holders.
The strong holder offering from DAOMaker once impressed me. Although the technical means and solutions used may not have been mature at the time, the concept of precise distribution and finding the truly suitable 'holders' is indeed quite advanced and in line with trends.
