Abandon the illusion — prepare for the most agonizing moments in the crypto market

Author: Santiago Roel Santos; Translation: Tim, PANews

Price and Adoption Paradox

Crypto adoption will continue, but market prices may remain stagnant for a long time.

This contradiction between accelerating real-world adoption and lagging market prices is not a flaw but a necessary feature of the current stage of crypto market evolution.

If you view the crypto market with a ten-year horizon, its prospects are highly attractive. However, maintaining this long-term perspective is psychologically challenging. You should be prepared for: witnessing adoption rates expand while prices stagnate or slowly decline; also, be ready to see others profit in other sectors (artificial intelligence, stocks, or the next hot trend), while crypto seems to be forgotten.

This feeling can seem unfair, and the process may be painful. But price lag is inevitable. Fundamentally, many crypto assets no longer deserve their previous valuations.

The market doesn’t care about actual adoption until prices crash and it starts to.

Widespread Application Fuels Bubble

Early-stage application adoption may actually trigger bubble issues. This is the pain point of value discovery: when real usage demand cannot support inflated valuations, the market will recalibrate, which is a necessary step for long-term healthy development.

When crypto infrastructure reaches scale, it becomes clear that external funding far exceeds actual demand. Widespread application will test business models rather than validate value. Some projects will fade away in silence; others will survive but at valuations far below their peak visions.

Cryptocurrencies are gradually moving from the spotlight to the background, becoming mere passersby. From excitement to ordinariness, this is the inevitable path from chaos to maturity.

This is a good thing.

This scenario is not new. During the dot-com bubble burst, the Nasdaq plummeted about 78%, while internet users tripled, and broadband infrastructure was fully deployed. It took years for the market to recover, and now the internet has quietly reshaped the world. While investors still lick their wounds, software has “consumed” the entire world.

Infrastructure technology will not reward those who seek quick gains.

When infrastructure wins, who will be the real winners?

Market stage transitions can be uncomfortable. Builders who have dedicated years to open-source codebases will see others copy their work and capture most of the economic benefits; early investors in infrastructure-focused crypto VCs will see traditional VCs gain more value; retail investors buying tokens instead of equity may feel marginalized—companies benefit from the ecosystem but do not return corresponding value to token holders.

Some issues are structural; others are self-inflicted dilemmas.

The market is self-correcting. Open networks will develop rapidly, incentives will change, and value capture mechanisms will improve, but not all models will survive to benefit.

Crypto adoption is quietly progressing, but the market has yet to truly recognize it. It may take years for the market to re-establish value correlations and realize that crypto technology is the core operating system, not just speculative assets.

Price Cycles vs. Application Cycles Are Different

Price cycles are driven by market psychology and liquidity.

Application cycles are driven by utility value and infrastructure.

While related, they are not synchronized. Historically, prices often lead applications, common in early technological revolutions. Today, applications are beginning to dominate, and prices are lagging.

Currently, marginal buyers of crypto assets are elsewhere—they are chasing the AI wave. This phenomenon may persist or reverse, beyond our control.

What we can see is a world increasingly difficult to imagine without stablecoins, transparent funding channels, or 24/7 global real-time settlement.

The deepest lesson from cycles is: we must accept that the time lag between application and price may far exceed expectations. To sustain compound growth, you need to remain rational even when patience wears thin.

This is not a call to HODL blindly.

Many crypto projects will never turn around. Some have fundamental flaws from inception; some lack moats; others have been completely abandoned. New winners will emerge, stars will fall, and a few true dark horses will rise.

Corrections Are Healthy

We are entering a different regulatory and economic environment. This creates opportunities to address long-standing issues: weak product revenues, insufficient asset disclosures, mismatched equity and token structures, and opaque team incentives.

If the crypto industry truly wants to become what it aspires to, it must first present itself properly.

I believe anything is possible. My most confident view is that within the next 15 years, most companies will adopt crypto technology to stay competitive. By then, the total market cap of cryptocurrencies will surpass ten trillion dollars. Stablecoins, tokenization, user scale, and on-chain activity will grow exponentially. Meanwhile, valuation standards will be redefined, existing giants may decline, and unreasonable business models will be eliminated.

This is healthy and necessary.

Cryptocurrencies will eventually become intangible. The more a company centers its business around crypto, the more fragile its business model often is. True lasting winners will embed crypto deeply into their workflows, payment systems, and balance sheets. Users should not notice the existence of crypto technology but should feel its benefits—faster settlements, lower costs, and fewer intermediaries.

Crypto should be pure and “boring.”

When capital tightens, airdrops, subsidies-driven demand, unreasonable incentives, and excessive financialization will come to an end—another inevitable cycle in history.

My basic judgment is simple: crypto applications will accelerate adoption, prices will readjust, and valuations will become rational again. Crypto is a long-term trend, but that does not guarantee your tokens will necessarily increase in value.

Who Captures the Value of Crypto Technology?

Core technology benefits consumers mainly by lowering prices and improving experience. Secondary beneficiaries are those companies upgrading their systems to leverage cheaper, faster, more programmable infrastructure.

This framework raises some uncomfortable but necessary questions:

• Visa or Circle?
• Stripe or Ethereum?
• Robinhood or Coinbase?
• A basket of Layer 1 protocols or user aggregators?
• A basket of Layer 1 protocols or DeFi?
• A basket of Layer 1 protocols or DePIN?
• DeFi or traditional stocks?
• DePIN or infrastructure stocks?

It’s not strictly a binary choice; diversification strategies are also viable. The question is about relative value and performance—who will capture the residual value created by blockchain?

I lean toward traditional and hybrid companies that connect to open settlement channels to reduce costs and increase margins. History shows they often benefit more than infrastructure itself.

But it must be emphasized that every framework has exceptions.

What I Believe and What I Don’t

I do believe that networks with real demand will eventually monetize, as the internet has proven. Facebook took years to monetize before becoming a business.

I am confident that the value of some Layer 1s will be validated as they develop, eventually matching their valuations. But I also believe most will struggle to attract users and find enough value to sustain themselves.

I believe the gap between winners and losers will widen further. Distribution, market entry strategies, user relationships, and unit economics will matter far more than first-mover advantage.

A common misconception in crypto is overestimating the early advantages of technological lead and underestimating other factors needed for subsequent development.

Returning to Reality

My outlook for the next few years’ price trends is not particularly optimistic. Adoption will continue to rise, but prices may further decline, possibly exacerbated by broader mean reversion in stocks and cooling AI hype cycles.

But patience is a major advantage.

• I am optimistic about crypto-as-a-service models
• I believe in crypto-enabled enterprises
• I am bearish on excessive financialization
• I am bearish on failed unit economics
• I am bearish on overbuilding infrastructure

Capital preservation becomes crucial. The value of cash is underestimated—not for its yield, but for the psychological immunity it provides. It allows you to act decisively when others cannot.

The market has entered an era of rapid movement and growing impatience. Today, having a longer-term perspective than most participants is itself a tangible advantage. Professional managers must frequently rebalance to prove their worth. Facing increasing life pressures, retail investors chase short-term hot spots. Institutional investors will also declare crypto dead once again.

Gradually, more traditional companies will adopt crypto technology, and more balance sheets will connect to blockchain.

One day, when we look back, everything will seem so clear. Signals are everywhere; only firm conviction makes it seem effortless—often only after prices rise.

Until then: brace for pain.

Wait for sellers to cut losses, wait for faith to collapse, but we are not there yet.

No need to rush. Markets will continue to fluctuate, life goes on, spend more time with those you care about. Don’t let your investment portfolio become your entire life.

The crypto world will operate silently, whether the market is in the dark or shining brightly.

Good luck to everyone.