Most crypto projects struggle to create sustainable products, says Rosie Sargsyan.
Most crypto projects struggle to create sustainable products as they constantly adapt to new narratives to attract investors, according to Rosie Sargsyan, Head of Growth at Ten Protocol.
The expert emphasized that this is not a personal choice but a systemic issue that “makes it structurally impossible to develop something enduring.”
Sargsyan coined the term “sunk-cost-maxxing” to describe the situation where projects immediately change direction at the first sign of difficulty. Unlike the usual advice to avoid sunk cost fallacies, the new norm in the crypto industry is to chase new trends.
“No one sticks to one direction long enough to see if it works. First difficulties — change course. Slow user base growth — change course. Funding challenges — change course,” she explained.
The product cycle has shrunk from 3-4 years during the ICO era to the current 18 months. According to Sargsyan, this is mainly due to the following factors:
“The problem is that nothing truly valuable can be created in 18 months. Developing a full-fledged infrastructure requires three to five years. True product-market fit is achieved through years of consistent improvements, not a few quarters of work,” the expert stressed.
The situation is exacerbated by incentive mechanisms. Airdrops and token sales attract attention, but without a well-thought-out strategy, users quickly leave after listing.
Sargsyan believes that the most resilient crypto projects were created during “periods of industry indifference.” Bitcoin emerged long before the venture frenzy, and Ethereum before the sector realized the value of smart contracts.
“Most startups that emerge during hype die with it. What is built between cycles has a better chance. But no one develops during these times: there’s no funding, attention, or exit liquidity,” she noted.
According to the expert, tokenization has created ideal conditions for early exits by investors and founders. As long as there is an opportunity to profit before development is complete, it will be exploited:
“Information spreads faster than products are created. By the time you finish, everyone already knows if it worked or not. The crypto industry is inherently geared towards speed. Asking it to slow down is asking it to become something else.”
The crypto market is structurally incompatible with long-term planning, Sargsyan concluded. A founder who remains true to the original idea and resists endless narrative shifts is likely to “find themselves isolated without investment and a team.”
There is no solution to this problem, the expert emphasized. She suggested that the main invention of the crypto industry is not a technological breakthrough but the art of extracting profits from unfinished projects. In this paradigm, the process of changing strategies becomes the end product.
The co-founder of the DeFi platform Comdex, known as Siddarth, suggested that the issue lies not only in short product cycles but runs much deeper:
“By its nature, the crypto industry is finance-oriented; thus, most users and use cases are primarily linked to speculation. When all participants are looking for the next 100x growth, attention will always shift faster than real value is created.”
Managing partner of the venture firm FinTech Collective, Sean Lippel, agreed with Sargsyan’s view, adding that some founders and investors consciously resist solutions that promote long-term planning.
“At a recent industry meeting, a group of investors, operators, and DC lobbyists looked at me like I was crazy when I supported A16z’s proposal for a five-year vesting of tokens in new market structure legislation. It’s insane how many founders have gotten rich without creating anything lasting,” he shared.
Some found positive aspects in the industry’s focus on changing narratives. A user under the pseudonym ika called the renewed excitement around Zcash “inspiring”:
