Industry "Stagnation," New User Growth Plateaued, How Can Project Teams Find a New Breakthrough?

Original Article Title: GETTING NEW USERS IN CRYPTO IS HARDER THAN EVER (WHAT TO DO)

Original Article Author: Emily Lai, Hype CMO

Original Article Translation: Deep Tide TechFlow

Crypto marketing work is dizzying: from choosing the right channels, to messaging, to team coordination. Should you invest in hosting an event? Do you need to launch an ambassador program? How should hackathon incentives be designed? There's always something to be done.

Great marketers will streamline the process, create plans, execute tasks, and help you save on budget.

Image: An effective marketing strategy can help you navigate what seems like a complex situation

However, crypto marketing at the current stage has become increasingly challenging.

What exactly is happening?

As founders, builders, and marketers, what can we do?

Why? There are three reasons: No new users!!!

Reason One: Intensifying Competition

The entire crypto ecosystem from chains, infrastructure, to dApps (decentralized applications) is saturated, with every project vying for attention with its own token.

Image: Data source: On-chain data provided by @defillama, dApps and token data provided by @alvaapp

Image: For example, my friend @mumufengg has never used an on-chain product (no hot wallet, nor touched dApps), but his first experience reflects the confusion of new users

According to @DefiLlama's data, there are currently over 356 blockchains.

After a talk, I had a conversation with @cattybk (from @thirdweb) who told me they have individually worked with over 2000 EVM chains. So, I checked @coingecko's data:

· Over 8700 L1 chains

· Over 5200 L2 chains

In addition, there are:

· According to @cookiedotfun, 1500+ AI agents

· According to @pumpdotfun and @Dune, over 50,000 new tokens are added daily

44 narratives tracked by @KaitoAI

The question is, are there new users flooding in to support these new chains, infrastructures, dApps, and tokens?

In terms of Total Value Locked (TVL), this cycle's performance is similar to the last cycle, and aligns with the Google search trend for the word "crypto" — a cyclical decrease in searches indicating waning interest from mainstream users.

Even with new users coming in, they are faced with the overwhelming choice of hundreds of chains, not to mention hundreds of wallets. This is more confusing than ever.

Figure: Data from @defillama showing TVL trends comparison

Figure : Google Trends displaying global search trends for "Crypto"

Reason 2: Diversified Target Audience

The crypto space has a diverse audience, each group with different motivations, further intensifying market fragmentation.

· Developers and Builders:

If you are a developer of a blockchain/network/ecosystem, you need to attract developers to build applications that can attract new users.

This requires developer marketing and onboarding. Developer motivations may include: wanting to realize a unique idea using your tech stack, receiving development grants, or seeing higher chances of success based on network effects and distribution capabilities.

· Customers and Users:

If you are a protocol, dApp, middleware, or service provider, you need to attract users to generate revenue.

For the ecosystem, the dApp team may be seen as customers.

It is important to note that users are not always the same as token holders; sometimes token holders may only be speculators and may not actually use your product.

· Venture Capitalists, Angel Investors, and other Investors:

These groups provide you with funding, and their motivation is to achieve a return on investment (ROI), usually through tokens, where the token's performance is not always directly related to the technology, user count, or developer count.

· Retail and Token Speculators:

These individuals may or may not be your users. Their goal is also a high ROI through token trading.

· Technical Partners:

These are typically other infrastructure or middleware projects. The growing demand for blockchain in terms of speed, security, and cost has spawned an entire middleware infrastructure area, including chain/wallet abstraction, cross-chain bridges, interoperability, modularity, etc.

In addition, there are service providers, not limited to custodians, but also including blockchain explorers, ad tech, unlocking software, etc.

These partners usually require a broad audience to target, which is why Business Development (BD) is so popular in the industry.

· Listing Partners:

This includes exchange platforms, launchpads, market makers, intermediaries, and KOL trades, among others. The performance of these groups directly impacts the success of your token, and their motivation is usually also linked to ROI.

· Regulatory Agencies and Institutional Investors:

These audiences can bring significant liquidity but may also lead to your company's downfall.

Beyond all these types of audiences, the globalization of the crypto industry further exacerbates market fragmentation. This means understanding cultural differences, coordinating information flow across different time zones, and managing localized marketing efforts.

All of this has made marketing in the crypto industry even more challenging. In contrast, Web2 marketing is more direct, information is conveyed more clearly, and motivations are more aligned.

For example:

· Selling Health Supplements: Targeting health-conscious individuals, the elderly, and high-income individuals.

· Selling Winter Jackets: Targeting people in cold climates, skiers, hikers, and snowboarders.

· Selling Protein Powder: Targeting fitness enthusiasts and bodybuilders, excluding vegetarians (if it's whey protein).

Reason Three: Immature Technology and Damaged User Trust

According to statistics, since the birth of Bitcoin, the media has declared its "death" 415 times. Furthermore, the crypto industry has gained a notorious reputation due to scams, money laundering, and crime.

Image: Some news headlines about crypto that might make your mother worry about your career choice in this industry

In 2021, the boom of NFTs and the metaverse attracted a large number of new users. Many celebrities also jumped in at that time. If you were working in the industry back then, you probably received many inquiries from old friends.

However, all of this came to a halt after the following issues emerged: high Gas fees, token price crashes, and users' painful loss experiences. These issues all led to a crisis of reputation and trust.

Mainstream users left the market, and we entered a phase of construction (a bear market), while also welcoming thousands of new chains and middleware.

Image: The industry's focus swings between "we need more applications" and "we need more infrastructure" (Inspiration from @jillrgunter's visualization)

So, why do you still stay here?

I don't know. Take a deep breath, calm down, and tell me your reasons (I genuinely want to hear your story, and it's crucial for your marketing too).

For me, I fell down the "rabbit hole" of Bitcoin in a university dorm in 2013 because I loved its values of sovereignty and self-sufficiency.

Since then, I have also seen cryptocurrency widely adopted in countries like Argentina, Indonesia, and Turkey.

For instance, in Buenos Aires, Argentina, I witnessed firsthand how people rely on a cryptocurrency stablecoin to survive amidst the country's hyperinflation:

Furthermore, many companies are leveraging blockchain technology, abstracting it away entirely.

A shoutout to @benLLS from @octantapp, who mentioned @jia_DeFi, a company helping emerging markets unlock capital and opportunities, and Hala Systems, dedicated to reducing harm, enhancing security, and stabilizing communities.

Then there are companies like @bombocommunity, ensuring the security of music ticketing through NFTs while abstracting away the crypto jargon. @cattybk also highlighted some blockchain-based casual games that are gaining significant user traction beyond Crypto Twitter.

Additionally, @mariashen (from @electriccapital) releases a developer report annually. Despite a slight decline in developer count compared to the previous cycle, Web3 developers are overall growing, indicating that we are not attracting net new users.

The Reality Is: Despite being 16 years in, we are still in the early days

Image: Classic chart of early adopters from the book Cross the Chasm

We have crossed the chasm; the mainstream market with high risk tolerance has embraced Bitcoin and sees cryptocurrency as an asset class.

But we have not yet conveyed to them the why: why we need thousands of blockchains, let alone an application that can get them to use it daily, surpassing the adoption speed of platforms like Instagram, Twitter, TikTok, WhatsApp, or ChatGPT (whose adoption has far outpaced the crypto industry).

What does this imply? Are we not building what people need? Or... is it just not mature enough yet?

I believe there are many kind-hearted individuals in this industry who are willing to drive social progress. I know some of these people. For example, @vijaymichalik, @arlery, @motherpredicte, @divine_economy, @alipaints, to name just a few.

If you are approaching the crypto industry with good intentions, what are the marketing fundamentals you need to master and apply?

These are two slides that I often showcase in my "What is Marketing" presentation, essentially condensing marketing strategy into four words.

You can see me delve deeper into this in a video I collaborated on with @modenetwork: click to watch.

Additionally, there is another version shared at the last India Blockchain Week (@ibwofficial), primarily discussing founder/personal brand background, using @megaeth_labs as an example: click to watch.

Three Key Tips for Acquiring Crypto Users

The crypto space has seven audience types spread across multiple geographical regions. Furthermore, your internal team members (business development, product, marketing, creative, legal, etc.) also need to collaborate.

In one of @moremarketsxyz's AMOS series episodes, hosted by @xkonjin, where I and @reka_eth participated, we had @jaambutties (CMO of @nillionnetwork) share how he coordinates brand activities.

This coordination can involve all stakeholders, amplify your marketing efforts, and help break through to capture the scarce and valuable attention in this space.

Ultimately, due to the early stage of the technology and the industry's extreme saturation, we do need to do some unscalable things. This includes individually guiding newcomers, personal involvement, and educating them.

While I very much enjoy showing @pumpdotfun to friends who have never been exposed to the crypto space, I also have to give major props to @a1lon9:

What's even better?

To break the cycle of attention deficit, you need consistent messaging and content output to maintain relevance.

This is why founders reply to tweets, why they engage in AMAs, and even show up in live videos.

This is also why teams record at events.

Engage with users, developers, investors, customers, and tell their stories.

At the same time, you also gain valuable product feedback.

My friend @shayyydz chose her first crypto wallet. As of writing, this post has garnered 5200 views because she chose @rainbowdotme.

Lastly, if you are a founder or a builder — this is most important:

Let's go back to the "why are you still here?" mentioned earlier and do some self-affirmation

No one knows your "why" better than you do. Tell us why you are building, why it matters. These stories are not only the vision you convey to the team but also the core of how you recruit new members, attract investors, and build a community.

Continually reiterate these stories, try different content formats.

Thank you for reading this far. If you're willing, please also share with me your story.

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