Web3's massive financing does not guarantee project success; LayerZero and Zksync face market indifference.

The Real Dilemmas of Financing and Developing Web3 Projects

Recently, several well-known Web3 projects have successively launched on exchanges. However, the market response has not been as expected. Taking LayerZero as an example, despite raising as much as $260 million and achieving a valuation of $3 billion, its performance after launch has been mediocre. Even though the price has seen a recent rebound, early investors still face significant pressure, as 90% of the tokens have not yet been released.

It's not that the market is bad this round, but that historically, projects with a lot of funding often "open high and close low"

Zksync has also faced neglect. Once a star in the industry, Zksync raised $200 million in a single round of financing in 2022. However, as the technology became more widespread, its uniqueness gradually diminished. After its launch, the price of the token continued to decline, with a market value of only around $3 billion. Controversies over its airdrop strategy have also affected community and ecological project support.

It's not that the market is bad this round, but historically, projects that raised a lot of money tend to "open high and close low"

Another highly anticipated project, Aleo, has also yet to issue its tokens. As a project valued at $1.45 billion in 2022, Aleo faces the dual challenges of funding pressure and market expectations.

Historical data shows that projects with financing scales exceeding $500 million often struggle to achieve good results. Among the projects that have issued tokens, EOS dropped from a financing amount of $40 billion to a market value of $1 billion. Terra and FTX have completely collapsed, resulting in significant losses.

It's not that the current market is bad, but historically, projects that raise a lot of funds tend to "open high and close low"

The fate of projects that have not issued tokens is also not optimistic. Projects that once thrived, such as Forte and Sorare, have now fallen silent. Even NYDIG and Fireblocks, which focus on enterprise services, are facing challenges brought about by changes in the market environment.

It’s not that the current market is bad, but historically, projects that have raised a lot of money tend to "rise high and fall low"

In contrast, Moonpay, which has practical application scenarios, has demonstrated relatively stable performance. However, even Moonpay chose the traditional IPO route instead of issuing tokens.

Looking back at the financing history of successful projects, Ethereum, Solana, and others only raised relatively small amounts of funds. This phenomenon highlights the importance of early low-price investments and the potential risks of overvaluation on project development.

It's not that the current market is bad, but rather that historically, projects with high funding tend to "open high and close low"

In the Web3 industry, true value comes from practical application scenarios and continuous innovation, rather than the scale of financing. Investors need to carefully assess project potential to avoid the risks associated with buying at high prices.

It's not that the current market is bad, but historically, projects that have raised a lot of money tend to "open high and close low"

View Original
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
  • Reward
  • 6
  • Share
Comment
0/400
FortuneTeller42vip
· 14h ago
Having a lot of money does not guarantee victory.
View OriginalReply0
DAOTruantvip
· 14h ago
Financing does not represent the future.
View OriginalReply0
CompoundPersonalityvip
· 14h ago
Financing does not equal success
View OriginalReply0
BearEatsAllvip
· 14h ago
Bear Market eats people and does not spit out bones
View OriginalReply0
NotSatoshivip
· 14h ago
Burning too much money doesn't necessarily smell good.
View OriginalReply0
SeeYouInFourYearsvip
· 14h ago
What if the valuation is low?
View OriginalReply0
Trade Crypto Anywhere Anytime
qrCode
Scan to download Gate app
Community
English
  • 简体中文
  • English
  • Tiếng Việt
  • 繁體中文
  • Español
  • Русский
  • Français (Afrique)
  • Português (Portugal)
  • Bahasa Indonesia
  • 日本語
  • بالعربية
  • Українська
  • Português (Brasil)