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January 3, 2025, marked the 16th birthday of Bitcoin (BTC), the world’s first-ever cryptocurrency. It has come a long way since—inspiring an entire industry of rival cryptocurrencies, exchanges, digital wallets, and trading apps, all of which contributed to a blockbuster year for the crypto sector in 2024.
Interest from the retail and institutional sectors were major drivers of this growth, but the emergence of new forms of cryptocurrency, such as memecoins and “rug pull” scams, where developers pull the plug on an upstart crypto project, leaving investors high and dry, have discouraged retail investors in particular from pursuing their interest in crypto investment.
The launch of the HAWK memecoin in early December 2024, associated with the viral social media personality Hailey Welch, is just one example of how badly things can go wrong. Having initially soared to a $490m market capitalization, the HAWK memecoin’s value dropped by around 90% within hours of its December 4 launch date. A group of investors has since filed a lawsuit against the creators of the memecoin, accusing them, among other things, of engaging in misleading market practices. Subsequent mainstream media coverage of the issue has only added to a growing feeling of unease and skepticism, deterring investors from entering the market.
The cost of inexperience
At the heart of the problem lies a pronounced lack of experience from crypto founders in the web3 space. While many founders hold a degree of technical proficiency in blockchain development, they lack the business acumen and commercial savvy needed to launch a successful crypto product and gain real world enterprise adoption—anything from proper customer discovery sessions in order to understand pain points and use cases, negotiating deals, brand identity building, marketing, promotion to PR support.
These supplementary skills are a foundational part of building and sustaining a successful business venture. Their absence has resulted in a proliferation of memecoins that are able to raise huge sums of money, occasionally propped up by a high-profile celebrity, but are ultimately unable to deliver on their promises. By not focusing on establishing a strong business foundation, too many of these projects are often doomed to fail.
From innovation to incubation
To address the problem, we need to look outside the industry and shift our focus from innovation to incubation and adoption. Specifically, non-crypto native incubation hubs hire experienced professionals from a range of industries, from software as a service (SaaS) to business development, marketing, and branding.
Collectively, this knowledge would be used to evaluate, review, and vet cryptocurrency projects for their financial viability. This crucial outsider perspective, where individuals from a wide range of backgrounds evaluate proposals free from the hype that often clouds new product launches in the crypto space, will help put an end to all the fake promises of founders who are merely looking to make a quick buck at the expense of investors. Instead, these hubs would be able to determine which crypto products have genuine potential, restoring trust and security to a sector that has been tarnished by a combination of inexperience and ineptitude.
Strategy is everything
The crux of the matter is any successful business venture depends on a fusion of not only ideation and innovation but also strategy and execution. That means creating a strategic roadmap that fuses market positioning, growth projections, and approaches for long-term value creation with risk management considerations, particularly when it comes to mitigating possible “rug pull” events associated with cryptocurrency launches.
The integration of non-crypto native expertise through incubation hubs is a powerful way to nurture a more stable and trustworthy crypto ecosystem, marrying both the innovative spirit of the crypto ecosystem with robust tried-and-tested business principles. Only then can the industry move beyond the era of hype-driven fads towards products that provide tangible real-world utility and deliver on the promise inherent to decentralized technologies.
