Cryptocurrency adoption will continue to accelerate, but market prices may remain stagnant for the long term. This contradiction between price and application is not a flaw but a necessary stage in the market’s maturation, and investors need to be psychologically prepared. This article is adapted and compiled from Santiago Roel Santos, founder of Inversion Ventures, in his piece “The Most Uncomfortable Phase of Crypto Has Begun,” organized by PANews Tim.
(Previous summary: The market destroyed me and also reshaped me: My awakening during 540 days in purgatory and the philosophy of crypto pain)
(Additional background: Investors’ pain intensifies, analyzing the market with 9 key data points: Are the bottom-fishing funds laying out?)

Table of Contents

• The Price and Adoption Paradox
• Application Popularization Sparks Bubbles
• When Infrastructure Wins, Who Will Be the True Winner?
• Price Cycles and Application Cycles Are Two Different Things
• Corrections Are Healthy
• Who Is Capturing the Value of Crypto Technology?
• What I Believe and What I Don’t
• Returning to Reality

The Price and Adoption Paradox

Crypto adoption will continue, but market prices may not rebound for a long time.

This contradiction between accelerating real-world adoption and market price lag is not a defect but a necessary feature of the current stage of crypto market evolution.

If you view the crypto market with a ten-year horizon, its prospects are very attractive. However, maintaining this long-term perspective is psychologically challenging. You should be prepared for: adoption rates expanding while prices stagnate or slowly decline; and witnessing others profit in other sectors (artificial intelligence, stocks, or the next hot trend), while crypto seems to be forgotten.

It may feel unfair, and the process can be agonizing. But price lag is inevitable. Fundamentally, many crypto assets no longer deserve their previous valuations.

The market does not care about actual adoption until prices crash and it starts to care again.

Application Popularization Sparks Bubbles

In the early stages of application adoption, bubbles may form. This is the pain of value discovery; when real usage demand cannot support inflated valuations, the market will recalibrate, which is essential for long-term healthy development.

As crypto infrastructure scales, it becomes clear that external capital far exceeds actual demand. Application adoption will test business models rather than validate value. Some projects will fade away in silence, others will survive but at valuations far below their peak visions.

Crypto is gradually moving from the spotlight to the background, becoming a bystander. From excitement to ordinariness, this is the necessary path from chaos to maturity.

This is a good thing.

This scenario is not new. During the dot-com bubble burst, the NASDAQ plunged about 78%, while internet users tripled, and broadband infrastructure was fully deployed. It took years for the market to recover, and now the internet has quietly reshaped the world. While investors are still licking their wounds, software has “consumed” the entire world.

Infrastructure technology does not reward those who seek quick profits.

When infrastructure wins, who will be the real winners?

Market transitions can make many participants uncomfortable. Builders who have dedicated years to maintaining open-source codebases will see others copy their work and reap most of the economic benefits; early investors in infrastructure crypto funds will see traditional VCs capturing more value; retail investors buying tokens instead of equity may feel marginalized, as companies benefit from the ecosystem but do not return corresponding value to token holders.

Some are structural issues; others are self-inflicted dilemmas.

The market is self-adjusting. Open networks will develop rapidly, incentives will change, value capture mechanisms will improve, but not all models will survive to benefit from these changes.

Crypto adoption is quietly progressing, but the market has not yet fully recognized it. It may take years for the market to re-establish value relationships and realize that crypto technology is a core operating system, not just a speculative asset.

Price Cycles and Application Cycles Are Two Different Things

Price cycles are driven by market psychology and liquidity.

Application cycles are driven by utility value and infrastructure.

While related, they are not synchronized. Historically, prices often lead applications, common in early technological revolutions. Today, applications are beginning to dominate, and prices are lagging.

Currently, marginal buyers of crypto assets are elsewhere, chasing the AI wave. This phenomenon may continue or reverse, beyond our control.

What we see is a world increasingly difficult to imagine—without stablecoins, transparent capital channels, or 24/7 global instant settlement.

The deepest lesson from cycles is: the time lag between application and price may be much longer than expected, and if you want continuous compound growth, you must remain rational even when patience wears thin.

This is not an advocacy for HODL.

Many crypto projects will never turn around. Some have fundamental flaws from the start, some lack moats, and some have been completely abandoned. New winners will emerge, with stars falling and a few true comeback stories.

Corrections Are Healthy

We are entering a different regulatory and economic environment. This creates opportunities to address long-standing issues: weak product revenue, insufficient asset disclosures, mismatched equity and token structures, and opaque team incentives.

If the crypto industry truly wants to become what it aspires to be, it must first present itself properly.

I believe anything is possible. My most confident view is that within the next 15 years, most companies will adopt crypto technology to stay competitive. By then, the total market cap of crypto will surpass ten trillion dollars. Stablecoins, tokenization, user scale, and on-chain activity will grow exponentially. Meanwhile, valuation standards will be redefined, existing giants may decline, and unreasonable business models will be eliminated.

This is healthy and necessary.

Crypto will eventually become intangible. The more a company centers its business around crypto, the more fragile its business model tends to be. True lasting winners will embed it into their workflows, payment systems, and balance sheets. Users should not notice the existence of crypto technology but should feel its benefits—faster settlements, lower costs, and fewer intermediaries.

Crypto should be pure and “boring.”

As capital tightens, airdrops, subsidies-driven demand, unreasonable incentives, and over-financialization will come to an end—another inevitable cycle in history.

My basic judgment is simple: crypto applications will accelerate in adoption, prices will adjust, and valuations will become rational again. Crypto is a long-term trend, but that does not mean your tokens will necessarily go up.

Who Is Capturing the Value of Crypto Technology?

Core technology mainly benefits consumers by lowering prices and improving experience. Secondary beneficiaries are those companies upgrading their systems to leverage cheaper, faster, and more programmable infrastructure.

This framework raises some uncomfortable but necessary questions:

• Visa or Circle?
• Stripe or Ethereum?
• Robinhood or Coinbase?
• A basket of Layer 1 protocols or user aggregators?
• A basket of Layer 1 protocols or DeFi?
• A basket of Layer 1 protocols or DePIN?
• DeFi or traditional financial stocks?
• DePIN or infrastructure stocks?

This is not an absolute binary choice; diversification strategies are also viable. The question is about relative value and performance—who will capture the residual value created by blockchain?

I lean toward those traditional and hybrid companies that connect to open settlement channels to reduce costs and increase margins. History shows they often benefit more than the infrastructure itself.

But it must be emphasized that every framework has exceptions.

What I Believe and What I Don’t

I do believe that networks with real demand will eventually monetize, and history has proven this. Facebook took years to commercialize.

I am confident that the value of some Layer 1 protocols will be validated as they develop, ultimately matching their valuations. But I also believe most will struggle to attract users and lack sufficient value to support their valuations.

I believe the gap between winners and losers will widen further, with distribution, market entry strategies, user relationships, and unit economics being more important than first-mover advantage.

A common misconception in crypto is overestimating the early advantage of technological lead and underestimating other factors needed for subsequent development.

Returning to Reality

My outlook for the next few years is not particularly optimistic. Adoption will continue to rise, but prices may further decline, possibly exacerbated by broader mean reversion in stocks and a cooling AI hype cycle.

But patience is a major advantage.

• I am optimistic about crypto-as-a-service models
• I am optimistic about crypto-enabled enterprises
• I am bearish on excessive financialization
• I am bearish on failed unit economics
• I am bearish on overbuilding infrastructure

Capital preservation becomes crucial. The value of cash is underestimated—not for its yield, but for the psychological immunity it provides. It allows you to act decisively when others cannot.

The market has entered an era of rapid pace and growing impatience. Today, having a longer-term perspective than most participants is itself a tangible advantage. Professional managers must frequently rebalance to prove their worth. Facing increasing life pressures, retail investors chase short-term hot spots. Institutional investors will again declare crypto dead.

Gradually, more traditional companies will adopt crypto technology, and more balance sheets will connect to blockchain.

One day, when we look back on this period, everything will seem so clear. Signals are everywhere; only steadfast conviction often appears effortless after prices rise.

Until then: wait for the pain to come.

Wait for sellers to cut losses, wait for faith to collapse, but we are not there yet.

No need to rush into action; markets will continue to fluctuate, life goes on, spend more time with those you care about. Don’t let your portfolio become your entire life.

The crypto world will operate silently, whether the market is in the dark or brightly lit.

Good luck to everyone.