But does this herald the beginning of a new bull market, or is it just another bubble waiting to burst? A little bit of both, according to a Twitter thread posted July 24, by Simon Dedic, co-founder of crypto research house, Blockfyre.
Big bulls are back
The current climate in the crypto landscape is in many ways reminiscent of 2017’s ICO boom. A whole host of new projects are popping up, with token sales selling out in hours, especially in the decentralized finance arena.
Established projects, or the strongest of them at least, are seeing triple digit increases to their token values, leading to Chainlink being dubbed the “Tesla” of cryptocurrency. Talking Tesla, head honcho Elon Musk has been shilling Dogecoin (DOGE) again, along with the perhaps more unlikely champion, social media app, TikTok.
The cream always rises
Dedic agrees that the latest DeFi craze is reminiscent of the ICO-mania in 2017, and feels that it is likely to play out in a similar way:
“It’s a narrative. Many interesting concepts arise that might change the financial sector. However, many useless cash grabs will as well.”
The strongest projects will survive, however, and Dedic sees the current money pouring into Chainlink and VeChain as vindication of this:
“Both projects were around in 2017, had an initial hype phase (such as DeFi currently has), then the bear hit and they just quietly focused on building their product.”
Of the current crop of DeFi projects, the ones to catch Dedic’s interest have been DMM Dao, Aleph, DecentR and DeFiPie. Whether they will all be successful long-term remains to be seen, but “all of these projects have very interesting approaches of disrupting the space of decentralized finance.”
FOMO is on its way
With fresh money coming into the market, Dedic believes that we will see another strong bull market, and that it has already started, if slowly.
“For now the majority of the money is educated and careful, due to the recent bear market. But [people] have started to throw it around less carefully.”
What follows is likely to be “a big retail FOMO wave that will pump the entire market.”
With a recent one-day 4,000% gain on a token whose creator described it as “worthless”, this may be closer than expected.
However, this will inevitably lead to another bubble burst, according to Dedic, so caution is required, as it usually is in the crypto world.