Sunk-Cost Maximization Threatens Crypto’s Long-Term Growth
Sunk cost maximization has led crypto projects to chase new narratives at the first sign of friction. According to Rosie Sargsian of Ten Protocol, product cycles have compressed from four years to just 18 months. This rapid narrative shift aligns with a 60% drop in VC funding in Q2 2025. Traders should be aware that token launches and airdrops often spark short-term hype but result in dump-and-abandon cycles without long vesting schedules. Sunk cost maximization undermines genuine infrastructure, which requires at least three to five years of iteration. Crypto traders must note that chasing short-term narratives can inflate prices temporarily but hinder true value accumulation and long-term market stability.
Bearish
This news highlights aggressive short-term narrative pivots and a significant drop in VC funding, indicating market uncertainty. In the short term, token launches and airdrops may drive price spikes, but the lack of long-term development and vesting schedules could lead to rapid sell-offs. Over the longer term, sustained infrastructure delays may undermine project credibility and investor confidence, weighing on price stability. As traders react to narrative fatigue and funding constraints, the broader market is likely to remain under selling pressure, making the overall impact bearish.