#WalletConnect

WCT

4. **Token Economics Model and Value Capture:**

* **Insufficient Utility Demand:** The actual demand for WCT tokens in its envisioned economic model (such as main chain transaction fees, sub-chain collateral, governance, etc.) highly depends on the prosperity of the entire ecosystem. In cases where the ecological development lags, the token value lacks solid support.

* **Inflation/Deflation Mechanism:** It is necessary to clearly understand whether the token issuance/burning mechanism is reasonably designed and whether it can maintain the stability or growth of token value during ecological development.

5. **Regulatory Uncertainty:** The regulatory framework for cryptocurrencies and blockchain applications is still evolving globally, especially concerning the Internet of Things and the on-chain of physical assets, which may face more complex compliance requirements.

6. **Overall Cryptocurrency Market Volatility:** The price performance of WCT will inevitably be affected by the bull and bear cycles of Bitcoin and the entire cryptocurrency market. In a bear market, projects like WCT often experience larger declines and worse liquidity.