In the crypto space, while the price fluctuations are enticing, what truly supports the price has never been hype, but whether the project itself can make money.
This statement sounds ordinary, yet it is the key that most people overlook. Most investors look at projects and only consider 'Is there a KOL promoting it?', 'Is the TVL high?', 'Is the community active?', but what they should really ask is—
> 'How does this project make money? And does it distribute money to you?'
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1. What is a 'profitable project'?
In the traditional world, you wouldn't buy stocks in a company that has no income at all. So why in the crypto space are you willing to buy a token that can't even explain its revenue logic?
Profitable projects must meet two basic conditions:
1. There is a stable source of income
For example: transaction fees, lending spreads, liquidation penalties, strategy fees, asset management fees, etc.
2. Income can be returned to token holders
The most common methods include: buyback and burn, token staking rewards, protocol dividend distribution, etc.
If only the first point is true, the project itself can survive, but the coin price may not necessarily rise; but if both points are true, then it is a token with intrinsic value.
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2. Why is the revenue model more important than the community?
Community hype can drive up coin prices, but it cannot create long-term value.
You must have seen this kind of project: high TVL, many people shouting on Twitter, the coin price surges quickly in the short term. But a few weeks later, there is no news, no updates, and the coin price falls back. Why? Because hype cannot sustain a protocol; money can.
Stable revenue protocols, even if they don't have that many topics, will slowly attract real knowledgeable funds into the market. Once this money comes in, it doesn't make noise; it only looks at the return rate and cares whether the protocol is steadily appreciating.
> The community can help you open up the market, but revenue is the moat that can support the price.
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3. How to determine if a project is truly 'profitable'?
Providing three practical judgment methods to help you see clues before investing:
1. The protocol has a clear business logic
→ What value does it provide? Is there a user willing to pay for this value?
2. There is revenue data, and the distribution logic is clear
→ Where did the income go? What percentage returns to the token? Is it buyback? Is it staking rewards? Or is it all for the team?
3. Financial mechanisms are open and transparent
→ Is there a dashboard? Is there a weekly/monthly report? Can you check the protocol's income and expenses?
If a project talks a lot about ideals and visions, but cannot clearly explain where the income comes from and does not state the value of the coin, then this is a 'coin supported by faith'; it is not an investment, it is gambling.
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Conclusion: The choices in a bear market come from your way of thinking
In a bull market, everyone can make money; in a bear market, only those who can see the essence will remain.
When the tide of funds recedes, projects with no revenue, no value, and no logic will naturally be eliminated. At that time, those that truly 'earn money by serving users' and return revenue to the tokens will truly show their value.
This is not a competition of who can shout the loudest, but rather a competition of who can sustain themselves, grow their users, and ultimately support the entire coin price.
📌 If you want to become a true crypto investor, remember this phrase:
> In the crypto space, it's not about finding 'who is the most popular', but rather finding 'who can make the most money and is willing to share with you.'