Written by: Dao Shuo Blockchain
Yesterday, several well-known media outlets in the crypto ecosystem reported a piece of news, which I have divided into three parts:
The $1 billion Ethereum DAT plan led by Li Lin, Shen Bo, Xiao Feng, Cai Wensheng, and others has been shelved, and the funds raised have been returned. This plan was the largest DAT led by Asian investors.
Regarding the reason for shelving, the relevant news reported as follows:
Industry insiders speculate that the main reason for shelving is the bear market after the 1011 incident, and recently, the stock prices of many DAT companies have also plummeted.
As for subsequent plans, the news reported as follows:
Regarding whether the plan will be restarted, relevant parties said that the interests of investors will be put first, and the market will be observed for now, going with the flow.
I have been following the news about these celebrities preparing this Ethereum DAT company since it first came out. There are two main reasons:
First, in my impression, some of these people are able to focus on long-term interests and reject short-term behavior.
Second, some of these people have made significant contributions to the early growth of Ethereum.
With such people leading the formation of this Ethereum-based DAT company, I see it as a relatively rational company, able to avoid being swayed by market sentiment and capable of making independent judgments.
Moreover, their investment target is Ethereum. In my view, in the long run, this choice is undoubtedly correct, and from the perspective of target selection, the risk is quite controllable.
Therefore, this DAT company is worth paying attention to, at least much more rational than some Ethereum DAT companies that mindlessly shout that Ethereum will reach XXX dollars by the end of this year or next year.
The only doubt I had at the time was:
Entering the market when Ethereum had already risen to over $4,000 (at that time), was that timing appropriate? Could a better entry point be found?
Of course, from a longer-term perspective, entering at $4,000 is also acceptable, but the whole team may have to withstand market pressure in the short term.
Now, recently, the market has been flooded with news of plunges every day — I've been waiting for this day for months.
I check every day to see if Ethereum has dropped below $2,500, and whether the S&P 500 index has been hit hard.
And then I happened to see the news above, which I divided into three parts.
The reason I divided the news into three parts is that each part is worth thinking about and exploring.
Let's look at the second part first, which can be summarized as: the reason for shelving the plan is the bear market.
According to common sense, if you are optimistic about a target in the long run and believe in its future potential, shouldn't you enter during a bear market, and be greedy when others are fearful?
I can't say whether entering at the current price of $3,000 is great, but it's certainly better than entering at $4,000 a while ago, right?
Why is it that now the price has dropped, but people are afraid to enter?
Is it because Ethereum's fundamentals have changed?
I don't seem to have seen any news proving that Ethereum's fundamentals have changed.
I also thought of another explanation: the team thinks the current price is still not good enough.
But if that's the case, they could just wait longer for a lower price, and there's no need to return the funds to investors now. In fact, they should be raising more funds at this time and telling investors: the price is low now, it's a better time to enter, and we need more money to seize the opportunity.
So this explanation doesn't seem to make sense either.
The third part seems to explain the deeper reason for shelving the plan, which can be summarized as: wait and see, go with the flow.
What does "go with the flow" mean?
What comes to mind is the "trading mentality" of the vast majority of people:
The market is rising now, so I (no matter what method I use) judge that the market will continue to rise in the future, that is, I have the ability to predict that the market will continue to rise for some time. That's when I buy.
Conversely, if the market is falling, I judge that it will continue to fall, so I can't buy.
Actually, if you want to follow this "trading mentality," there are countless meme coins in the market where this approach can be used. There's really no need to target Ethereum — if you can predict the market's next move, why not pick a more volatile target?
There's another sentence in the third part that's even more intriguing: "Relevant parties said they will put investors' interests first."
"Put investors' interests first"?
Isn't buying a long-term potential target at a lower price the best way to put investors' interests first?
Or is it that buying when the market is soaring is putting investors' interests first?
I suspect what this sentence really means is not "putting investors' interests first," but "putting investors' emotions first."
Why?
Because most investors care more about emotions and short-term market feedback. If you buy something and it doesn't go up in three days, they get anxious. If you tell them what will happen in a few years or even a year, they have no patience to listen. They want to know why it hasn't gone up in three days. If you can't comfort them, that's a problem.
And the current crypto ecosystem is facing such an environment.
In a less-than-ideal market environment, if you enter now and Ethereum's price drops further, what if investors get emotional?
So it's better to shelve the plan and avoid the risk of investors' money facing possible short-term losses. As for the long-term potential and future prospects that were once envisioned, there's simply no way to explain that to investors at this time, and even if you did, it might not help.
This situation with funders is a problem that many fund managers face.
Recently, I saw an interview with Lin Yuan, where he talked about this issue.
In the interview, the reporter asked him: What do you do if your investors have opinions about your investments?
He answered bluntly: Why bother with them? The agreement is already written.
The reporter asked again: How do you explain to them?
He answered just as bluntly: I don't explain.
As for Lin Yuan, I appreciate many of his views, but some of his opinions seem to me to be a mix of good and bad.
But after watching this interview, I genuinely think he's a very interesting person.
Buffett and Munger have also shared very tough views on how to deal with investors.
Someone asked them why they don't split Berkshire Hathaway's stock to lower the price per share and allow more investors to participate.
The two gentlemen answered bluntly (paraphrased): We don't want a lot of investors buying our stock; we want to maintain this threshold. Investors who don't agree with our approach should sell our stock and find other investors.
Later, because too many Wall Street groups were issuing a bunch of "copycat" stocks in the names of the two gentlemen, they were forced to issue some B shares. But after that, there were no more stock splits.
Whether it's Lin Yuan or Buffett and Munger, their meaning seems very similar to me: fund managers should not be swayed by the emotions of funders. And the best approach is to screen funders strictly from the start. If their philosophies and values are different, you shouldn't take their money, and there's no need to work together. Such people can't possibly work together to reach the shore of victory.
