Looking at encryption Twitter, there is no longer a Money Effect.

Author: Lauris

Compiled by: Deep Tide TechFlow

Welcome to the era of “Post-Encrypted Twitter”

The “Crypto Twitter” (CT) referred to here refers to the Crypto Twitter as a market discovery and capital allocation engine, rather than a general reference to the entire crypto community on Twitter.

“Post-Crypto Twitter” does not mean the disappearance of discussion, but rather that Crypto Twitter, as a “mechanism for coordination through discourse,” is gradually losing its ability to repeatedly create significant market events.

A single culture will not be able to continuously attract the next wave of new participants if it can no longer produce enough significant winners.

The “significant market events” mentioned here do not refer to situations like “a certain token's price has tripled,” but rather to the focus of most liquidity market participants being concentrated on the same thing. Within this framework, Crypto Twitter used to serve as a mechanism that transformed public narratives into a coordinated flow around a dominant meta-narrative. The significance of the “post-Crypto Twitter” era lies in the fact that this transformation mechanism is no longer functioning reliably.

I am not trying to predict what will happen next. To be honest, I don't have a clear answer either. The focus of this article is to explain why the previous models worked, why they are declining, and what this means for how the crypto industry can reorganize itself.

Why did crypto Twitter work in the past?

Crypto Twitter (CT) is important because it compresses three market functions into one interface.

The first feature of Crypto Twitter is narrative discovery. CT is a high-bandwidth significance mechanism. “Significance” is not just an academic term for “interesting” but a market term that refers to how the graph converges on current things worth paying attention to.

In practice, Crypto Twitter has created a focal point. It compresses a vast hypothetical space into a small subset of “actionable” objects at this moment. This compression addresses a coordination problem.

To put it more mechanically: Crypto Twitter transforms decentralized, private attention into visible, public shared knowledge. If you see ten credible operators discussing the same object, you not only know of the object's existence, but you also know that others are aware of its existence, and that others know you are aware of its existence. In liquidity markets, this shared knowledge is vital.

As Herbert A. Simon said:

“The abundance of information leads to a scarcity of attention.”

The second function of encrypted Twitter is to act as a trust router. In the crypto market, most assets do not have the characteristics to provide a strong intrinsic value anchor in the short term. Therefore, capital cannot be allocated solely based on fundamentals, but rather flows through people, reputations, and continuous signals. “Trust routing” is an informal infrastructure that determines whose claims can be believed early enough to have an impact.

This is not a mysterious phenomenon, but rather a rough reputation function calculated continuously in public by thousands of participants. People infer who the early entrants are, who has good foresight, who has resource channels, and whose behavior is associated with positive expected value (Positive EV). This layer of reputation makes capital allocation possible without formal due diligence, as it serves as a simplified tool for selecting counterparties.

It is worth noting that the trust mechanism of crypto Twitter does not solely depend on the “number of followers.” It is a composite result of the number of followers, who follows you, the quality of replies, whether credible people interact with you, and whether your predictions withstand real-world validation. Crypto Twitter makes these signals easy to observe and at a very low cost.

Cryptocurrency Twitter has public trust, but over time, certain communities have gradually formed a tendency to place more emphasis on private trust.

The third function of encrypted Twitter is to transform narratives into capital allocation through reflexivity. Reflexivity is the key to this core loop: narratives drive prices, prices validate narratives, validation attracts more attention, and attention brings more buyers, with this loop continuously reinforcing itself until it collapses.

At this point, the microstructure of the market comes into play. The narrative does not abstractly drive the “market,” but rather drives the order flow. If a large group is persuaded by a certain narrative to believe that a certain object is “key,” then marginal participants will express that belief by making purchases.

When this cycle is strong enough, the market will temporarily prefer to reward behaviors that align with consensus rather than the ability for deep analysis. In retrospect, Crypto Twitter is almost like a “low-IQ version of Bloomberg Terminal”: a single information stream that merges significance, trust, and capital allocation.

Why has the era of “single culture” become possible?

The reason the era of “monoculture” can exist is that it has a repeatable structure. Each cycle revolves around an object that is simple enough for large groups to understand, yet broad enough to attract the attention and liquidity of most of the ecosystem. I like to call these objects “toys.”

The term “toy” here is not derogatory, but rather a structural description. It can be understood as a game—easy to explain, easy to participate in, and inherently social in nature (almost like an expansion pack for a massively multiplayer online role-playing game). A “toy” has a low barrier to entry in terms of participation difficulty and a high degree of narrative compression; you can explain what it is to a friend in one sentence.

The “Meta narrative” (Meta) is the expression that occurs when “toys” become a shared game board. Meta refers to the dominant strategy set and the dominant object around which most participants revolve. The reason why a “single culture” is powerful is that this meta-narrative is not just “popular,” but a shared game that spans users, developers, traders, and venture capital firms. Everyone is playing the same game, just at different levels of the stack.

@icobeast once wrote a wonderful article about the periodicity and changing nature of “trendy things,” which I highly recommend reading.

The market system we are experiencing requires an “inefficiency window” that allows people to quickly earn “incredible wealth.”

In the early stages of each cycle, the market is not completely efficient because the infrastructure for large-scale participation in the meta-narrative is not yet fully established. While opportunities already exist at this time, the niche space in the market has not yet been fully filled. This is very important because widespread accumulation of wealth requires a window period that allows a large number of participants to enter the market, rather than facing a completely hostile environment from the outset.

As George Akerlof said in “The Market for Lemons”:

“Information asymmetry between buyers and sellers can lead the market away from efficiency.”

The key is that in order for this system to operate, you need to provide a highly efficient market for one group of people, while for another group, this market is a typical “lemon market” (i.e., a market full of information asymmetry and inefficiency).

A single cultural system requires a large-scale shared context, and Crypto Twitter (CT) provides this context. Shared contexts are very rare on the Internet because attention is usually dispersed. However, when a single culture forms, attention tends to concentrate. This concentration can reduce coordination costs and amplify the effects of reflexivity.

As Hayek (F. A. Hayek) stated in “The Use of Knowledge in Society”:

“The information from the situations we must leverage has never existed in a centralized or consolidated form; it is merely scattered in the hands of individuals as incomplete and often contradictory fragments of knowledge.”

In other words, the formation of a shared context allows market participants to coordinate actions more efficiently, thus promoting the prosperity and development of a singular culture.

Why was the “single narrative” once so credible? When the fundamental constraints on the market are weak, salience becomes a more important constraint than valuation. The primary question in the market is not “How much is it worth?” but rather “What are we all focusing on? Is this trade already too crowded?”

A rough analogy is that popular culture used to be able to focus attention on a few shared objects (like the same TV shows, music on the charts, or celebrities). Nowadays, attention is dispersed into various niche areas and subcultures, and people no longer share the same reference set on a large scale. Similarly, Crypto Twitter (CT) as a mechanism is also undergoing a similar transformation: the top-level shared context is diminishing, while more localized contexts are beginning to appear in smaller circles.

Why is the era of “Post-Encrypted Twitter” coming?

The emergence of “Post-CT” is due to the gradual failure of the conditions that support a “single culture.”

The first failure lies in the fact that the “toys” were cracked faster.

In previous cycles, the market has learned the rules of the game and industrialized them. Once the rules of the game are industrialized, the inefficiency windows close faster and their duration becomes shorter. The result is that the distribution of returns becomes more extreme: there are fewer winners, while structural losers are increasing.

Memecoins are a typical example of this dynamic. As an asset class, they are effective because of their low complexity and extremely high reflexivity. However, it is this very characteristic that makes memecoins easy to mass produce. Once the production line matures, the meta-narrative will turn into an assembly line.

With the development of the market, the microstructure has changed. The median participant is no longer trading with other ordinary people, but is instead in opposition to the system. By the time they enter the market, information has already been widely disseminated, liquidity pools have been “pre-buried,” trading paths have been optimized, insiders have completed their layouts, and even exit paths have been calculated in advance. In such an environment, the expected returns for the median participant are compressed to a very low level.

In other words, in most cases, you are just becoming someone else's “Exit Liquidity.”

A useful mental model is that the order flow in the early stage of a cycle is mainly dominated by naive individual investors, while the order flow in the later stage of the cycle increasingly exhibits confrontational and mechanical characteristics. The same “toy” can evolve into a completely different game at different stages.

A single culture cannot sustain itself if it cannot produce enough significant winners to attract the next wave of new participants.

The second failure lies in value extraction overwhelming value creation.

Here, “Extraction” refers to those actors and mechanisms that capture liquidity value rather than create new liquidity.

In the early stages of the cycle, new participants can increase net liquidity while benefiting from it, as the pace of market expansion outstrips the harvesting speed of the value extraction layer. However, in the later stages of the cycle, new participants often become net contributors to the value extraction layer. When this sentiment becomes widely recognized, market participation begins to decline. The decline in participation weakens the intensity of the reflexive cycle.

This is also why the changes in market sentiment are so consistent. If a market no longer offers a broad and clear path to victory, the overall sentiment will gradually deteriorate. In a market where the median participant's experience is “I am just someone else's liquidity,” cynicism is often rational.

To understand the overall market sentiment of current retail participants, you can refer to this post by @Chilearmy123.

The third failure lies in the dispersion of attention. When there is no single object capable of capturing the attention of the entire ecosystem, the market's 'discovery layer' loses its clear significance. Participants begin to differentiate into narrower fields. This dispersion is not only cultural but also brings significant market consequences: liquidity is dispersed across different segments, price signals become less intuitively visible, and the dynamic of 'everyone is making the same trade' fades away.

In addition, there is another factor that needs to be briefly mentioned: macroeconomic conditions can affect the intensity of the reflexive cycle. The “single culture” era coincided with a period of strong global risk appetite and liquidity conditions, making speculative reflexivity appear to be a kind of “norm.” However, when the cost of capital rises and marginal buyers become more cautious, narrative-driven capital flows become more difficult to sustain in the long term.

What does “Post-Encrypted Twitter” mean?

“Post-CT” refers to a new market environment where Crypto Twitter is no longer the primary coordinating mechanism for capital allocation across the entire ecosystem, nor is it the central engine around which on-chain markets concentrate around a single meta-narrative.

In the era of “single culture,” Crypto Twitter repeatedly and extensively linked narrative consensus and liquidity concentration. In the era of “post-Crypto Twitter,” this connection has become weaker and more intermittent. Crypto Twitter still holds significance as a discovery platform and reputation metric, but it is no longer the reliable driving engine that synchronizes the entire ecosystem around “a transaction,” “a toy,” or “a shared context.”

In other words, crypto Twitter is still able to generate narratives, but only a few narratives can be transformed into “shared knowledge” on a large scale, and even fewer “shared knowledge” narratives can further be transformed into synchronized order flow. When this conversion mechanism fails, even if there are still many activities happening in the market, the overall sentiment will appear “quieter.”

This is also why subjective experiences have changed. The market now appears slower and more specialized, as widespread coordination has disappeared. The emotional shift is primarily a response to changes in expected value (EV) conditions. The market's “quietness” does not mean there is no activity, but rather a lack of narratives and synchronized actions that can resonate globally.

The Evolution of Crypto Twitter: From Engine to Interface

Cryptocurrency Twitter (CT) will not disappear, but its functionality has changed.

In the early market system, crypto Twitter was upstream of capital flow, to some extent determining the direction of the market. In the current market system, crypto Twitter is closer to an “interface layer”: it broadcasts reputation signals, surfaces narratives, and helps route trust, but actual capital allocation decisions are increasingly happening in higher trust “subgraphs.”

These subgraphs are not mysterious. They are dense networks with higher information quality and frequent interactions among participants, such as small trading circles, communities in specific fields, private group chats, and discussions between institutions. In this system, crypto Twitter acts more like a superficial “facade,” while the real social and trading activities occur in the underlying social network layer.

This also explains a common misconception: “Crypto Twitter is declining” usually actually means “Crypto Twitter is no longer the main place for ordinary participants to make money.” Wealth is now more concentrated in places with higher quality information, limited access, and more private trust mechanisms, rather than through public and noisy trust calculations.

Nevertheless, you can still achieve considerable earnings by posting on crypto Twitter and building a personal brand (some of my friends and nodes have done this and continue to do so). However, the real value accumulation comes from building your social graph, becoming a trusted participant, and gaining more access to opportunities in the “back end”.

In other words, while surface-level brand building remains important, core competitiveness has shifted towards the construction and participation in a “backend trust network.”

I don't know what will happen next.

I will not pretend that I can accurately predict what the next “monoculture” will be. In fact, I am skeptical about whether a “monoculture” will form again in the same way, at least under current market conditions. The key is that the mechanisms that once nurtured the “monoculture” have degraded.

My intuition may be somewhat subjective and contextual, as it is based on the phenomena I currently observe. However, the formation of these dynamics actually began to manifest earlier this year.

Currently, there are indeed some active areas, and it's not difficult to list those categories that attract attention. However, I will not mention these areas as they do not provide any substantial help to the discussion. Overall, apart from pre-sales and some initial allocations, the trend we are seeing now is that the most overrated categories are often those that are “adjacent” to crypto Twitter (CT), rather than directly driven by crypto Twitter itself.

Argument

We have entered the era of “Post-Crypt Twitter” (Post-CT).

This is not because crypto Twitter is “dead,” nor because discussions have lost their significance, but rather because the structural conditions that support the repeatedly emerging systemic “single culture” have been weakened. The game has become more efficient, the value extraction mechanisms have matured, attention has become more fragmented, and the reflexive cycles have gradually shifted from systemic to localized.

The crypto industry is still ongoing, and crypto Twitter still exists. My view is more narrow: that particular crypto Twitter, which could reliably coordinate the entire market into a shared meta-narrative and create an era of broad, low-barrier, non-linear gains, has at least come to an end for now. Moreover, I believe the likelihood of this phenomenon reoccurring in the next few years is significantly reduced.

This does not mean that you cannot make money, nor does it mean that the cryptocurrency industry has come to an end. This is neither a pessimistic viewpoint nor a cynical conclusion. In fact, I have never been as optimistic about the future of this industry as I am now. My point is that the future market distribution and significance mechanisms will be fundamentally different from those of the past few years.