About Farcaster's growth, innovation, speculation

Author: Albiverse Source: mirror Translation: Shan Oppa, Golden Finance

In this article, my aim is to shed light on the events leading up to Farcaster's recent developments, emphasizing the interplay between:

1. Memecoin speculation - represents financial capital

2. Product innovation - represents production capital

3. Product innovation - represents production capital

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The dance between money and product innovation in technology

As economist Carlota Perez points out in her book on the subject, the dance between productive and financial capital is at the heart of “technological revolutions.” As new technologies emerge, entrepreneurs envision new possibilities and are supported by investors who provide the necessary resources to realize these visions.

A recurring pattern emerges: Bubbles occur when financial capital overshadows productive capital, thereby inflating the value of underdeveloped productive assets. This is especially true when retail investors join en masse in excitement about new technologies and speculative financial activity.

However, actual product innovation is inherently slower. That is, building tangible technology cannot keep up with the speed of speculation or imagination of what the technology might achieve.

Consider the dot-com bubble, using the Nasdaq index as an example. It demonstrates the decoupling of financial and productive capital that took Nasdaq 20 years to reach the heights it reached in the late 1990s.

This was the Dow Jones crash of the 1930s. It took the market 25 years to recover.

Farcaster’s mini-tech revolution

This bubble phenomenon happens in cryptocurrencies at any scale And happens any time, multiple times a week or even a few days. Each cycle provides funding for infrastructure and product experimentation, although bubble dynamics may wane over time as markets mature and investors later recognize their investments in these technologies and products during the deployment phase of true value.

Farcaster's recent growth has been driven by a number of factors:

• Product Innovation: The introduction of Frame applets opens up new avenues for developers and entrepreneurs.

• Financial assets for speculation: including $DEGEN, $FRAMES, Frame NFT and Farcats. Allows the Farcaster community to "adjust the bank" as the network evolves

After a period of growth and exploration of Frame technology functions, despite the achievements Significant progress has been made, but excitement is being readjusted to the reality of Farcaster's development status.

Surprisingly, the $DEGEN memecoin chart now closely resembles a typical cryptocurrency bubble chart.

A series of events that led to the growth of FC

Farcaster's daily active users (DAU) grew completely Attributions to product innovation or speculation are false. In fact, these two factors are closely linked. A timeline of key events shows how Farcaster's growth has been driven:

• Farcaster team over time Over 3 years, the protocol, network and Warpcast client were developed, and the community was gradually established.

• In the summer of 2023, Warpcast launched "Channels," similar to Reddit subfeatures.

• By October 2023, Warpcast has launched an off-chain points system and an in-game currency called Warps, making it non-transferable and intentionally prevent speculation.

• But soon, as the memecoin became more and more popular in the Solana ecosystem, the Farcaster community began to express its desire to create its own Interest in meme coins.

• The launch of the Rainbow Wallet off-chain points system prompted the Farcaster community to launch $points. In just 24 hours, $points’ price action resulted in re-engagement from leading crypto Twitter (CT) personalities and influencers on Farcaster.

• A number of other meme coins followed, including $WOWOW, $SPAM, and others.

• Among various memecoins, $DEGEN stands out with a stronger design and team and becomes the top memecoin on Farcaster.

• On the product side, the Mod team's embedded mini-app demo inspired the Farcaster team to develop the Frames feature, turning Warpcast into a The platform, a potential super-app where users can interact with third-party apps directly in the Warpcast feed and settings, is exploding.

• The price of $DEGEN rises simultaneously as speculators view it as the top token on Farcaster (Warps is off-chain , centralized and non-tradable).

• The price increase has attracted more influencers, developers, and users to try this exciting new Frames feature and participate in FC of excitement and bet on $DEGEN, $FRAME and other speculative assets issued by Frames.

As Jacob points out, memecoins are like beacons in the crypto noise, attracting attention through their price charts , and spark conversations around the project. Influencers and enthusiasts from crypto Twitter (CT) and the tech community quickly joined the platform, eager to be part of the trend.

Finally, according to Spindl’s Frame analysis, about half of the Frames retweeted and liked so far are related to meme coins and airdrops. The other half is created by a range of projects such as Layer3, Seam, Coinbase, PartyDAO, Perl, Base, Syndicate, and individual developers.

Financial speculation is a key component of cryptocurrency growth, and this is nothing new. I feel like the relationship between Deggans and the builder is worth highlighting given the discussion I've seen about Farcaster's recent growth, and I've enjoyed applying Carlota Perez's research to the crypto space, especially since I first wrote Since my master's thesis on this topic.