The crypto world has experienced dopamine fatigue; how can the market rescue itself from short-term stimuli?

Source: Galois Capital X account

Author: Galois Capital

Compiled by: Shenchao TechFlow

It seems that since the change in Twitter's default algorithm, the narratives in the cryptocurrency space have become less intense, thanks to AlokVasudev's reminder. I suspect that about half of the crypto Twitter users are still stuck in the "For You" feed, which promotes TikTok-like interactions.

With the elections approaching, this feed often showcases more controversial political topics. The other half of the users are in the "Following" feed, which may or may not have had its algorithm changed.

In any case, when attention is so fragmented, it seems harder for long-term narratives to form. Therefore, nothing seems to be able to sustain itself, and the cycles of narratives appear very brief and lacking in permanence.

Moreover, as we vaguely sense an oversupply of infrastructure and a lack of killer applications, with few projects truly achieving product-market fit, we are in a phase filled with imitation behavior.

DriftProtocol has launched a prediction market with the success of Polymarket. Meanwhile, sunpumpmeme and ethervista are also imitating pumpdotfun.

From one perspective, the industry seems to have run out of ideas for application innovation, so choosing to replicate those projects that have already succeeded is the best strategy. From another angle, Polymarket and pumpdotfun may unexpectedly benefit from the changes in Twitter's algorithm.

The controversial political topics in the "For You" feed may have increased the willingness of users to pay attention to Polymarket. You might think that this phenomenon intertwines with the fact that the upcoming elections are considered one of the most important for the industry.

I can't help but wonder if this is a reflexive mechanism. Perhaps greater political polarization and attention to cryptocurrency lead to more political donations, which in turn prompts politicians to pay more attention to and discuss cryptocurrency, ultimately drawing more crypto Twitter users into politics.

In other words, is it possible that as the industry increases its focus on politics, politics also invests more attention in the industry?

From another perspective, the changes in the algorithm that prevent long-term narratives from forming may inadvertently benefit pumpdotfun and its short-term narratives.

As attention becomes fragmented and time shortens, complex mechanism design issues seem overly cumbersome for those influenced by dopamine. At the same time, people's gambling tendencies increase, similar to the situation when Robinhood gamified trading and stocks rose.

This raises two questions:

1) How do we return to a better era?

2) If we cannot go back, which cryptocurrencies will perform well in the context of crypto Twitter users' ongoing attention deficit?

For the first question, I believe that due to the influence of accelerationism, we have begun to feel dopamine fatigue. Once this situation ends, I can foresee that people will turn to higher-quality choices, rejecting modernity and returning to authenticity. This could be a moment of new reactionism for cryptocurrencies.

For the second question, while we wait, we might as well look for some simple and stimulating projects that offer short-lived pleasures. In this case, you may need to act quickly to avoid falling into the trap of addiction.