Variant co-founder Jesse Walden: In the current bull market, you should distinguish between "signals" and "noise."
Time management is crucial in high-noise environments.Original Title: Signal to noise
Written by: Jesse Walden
Compiled by: Deep Tide TechFlow
In a rising market, both signals and noise are increasing.
For crypto players, it is important to have the ability to understand signals and noise and to distinguish between the two.
Signal
Technology is maturing, broadening possible fields
More talented teams are launching interesting projects
Price feedback leads to broader user interest, increasing usage rates
Experimentation is speeding up, with new use cases emerging
Noise
More mercenary teams are getting enthusiastic about popular narratives, copy-pasting and mass-producing projects
Everyone is launching a narrative or a token, then driving up the prices of these coins
A series of projects are raising excessive amounts of funding
Since everyone in the cryptocurrency space is, to some extent, an investor—whether through holding tokens or working at startups—it is crucial to analyze the increased trading volume by balancing short-term opportunities with a strict view of long-term prospects.
When I invest, I try to adhere to a few principles:
Short-term token prices do not predict long-term success.
Projects that heat up in the short term are more likely to experience black swan events.
In a high-noise environment, time management is crucial: measure the time investment in short-term versus long-term investments. Confusing the two is dangerous, and worse, getting them wrong.
It is important to understand the primary direction of your partners (short-term or long-term) when working with them.
Over the past decade of cryptocurrency development, I have consistently chosen long-term investments. That said, sometimes the best way to understand the game is to participate in it. There are signals within the noise. But don’t lose your way; engage wisely with your investments.
