When it comes to the threshold of the crypto industry, many investors who are deeply involved in the currency circle must have a deep understanding. From the early market focus on mining, to the later ICO and currency issuance, to the current rise of defi and nft, in fact, each industry progress is constantly accumulating its own protective wall, which blocking many people who have no foundation and are not good at learning.

In 2017, many people was using their wallet to transfer coins to participate in ICO. In 20-21, people also learn to plug-in wallets and interact with smart contracts, but also understand cross-border transactions. Chain, DeFi impermanent loss, AMM Swap and mint NFT, etc., are basically unfriendly to most of the novices who have no basic financial knowledge, so when the big guys are having fun on the chain, the new people have chosen the way to exchange speculative coins, so a large number of MEME coins began to go crazy, which also accelerated the market correction.

The first thing an ordinary person needs to learn when entering the circle is the basic knowledge of wallet, transfer, public and private keys, etc. However, the actual situation is not the case, most newbies are still willing to enter the centralized exchange to buy and sell their tokens. Many people I contacted still do not understand the use of wallets, smart contract and chains like polygon, Celo, Avax, BSC, HECO, etc., thus They are immersed in the comfort provided by the centralized exchange.

There are actually two types of thresholds

The first is the novice’s lack of understanding of basic financial knowledge, and the other is the inability to keep up with the learning progress caused by the outbreak of emerging knowledge.

The basic knowledge of this market is concentrated in the field of Defi. Defi uses a lot of modern financial knowledge systems, such as deposits, loans, transactions, etc., and applies innovation on it. Another direction is GameFi, which is used in traditional web games, etc. Gamefi adding financial attributes to the game, so that players can earn money but the players must need to learn certain game skills to earn money. This part is actually not very difficult, and it is relatively easy if you want to understand.

The explosion of emerging knowledge is actually a headache for most newcomers and even some veterans at present, emerging knowledge is often narrow in scope, such as a comprehensive analysis of a specific project, hot spots of new concepts, and new gameplays appearing in the market. These knowledge systems are often fragmented, and there is no specific transmission path. Even if there are corresponding tutorials in the market, they are mixed, and a mature system has not been formed. Therefore, it often takes a lot of time, energy and money to learn this part, and it is not possible to step on the pit, so this blocks most people.

Result of the threshold

The increasing barriers to in-depth understanding of the cryptocurrency industry make it difficult for many people to truly understand the cryptocurrency industry, which can lead to the following results:

1. Some people mainly focus on research in a specific direction, and it becomes more difficult to fully understand the industry. For example, some people study defi, some people mainly focus on NFT, and some people have been paying attention to web3.0. In this way, to a certain extent, you can have many investment opportunities in the industry, you can only focus on a specific scope under the premise of limited personal energy, which can greatly improve the probability of finding high-quality projects.

2. Another part of investors is more focused on token speculation in exchanges, and regards token speculation as behavior similar to stock investment, so they are more focused on technical analysis such as K-line, because this part does not require too much research or too much crypto knowledge, so the threshold is relatively low. For example, our direct impression is that the trend of cryptocurrency and the trend of U.S. stocks in the past year have become more and more correlated, which also shows that some Wall Street investors are allocating stocks and other assets. When the stock assets fall, they also sell some crypto assets to reduce the overall position risk.

Some people think that the increase of the industry threshold will affect the development of the industry. In fact, this is not the case. For example, the dividends of the big data, artificial intelligence, Internet of Things and other industries in the past few years have always existed, and even there will be no signs of decline in the next few years. However, it is obviously difficult for individuals to intervene in these fields, which also shows that the development of the industry mainly depends on market recognition and social needs, rather than thresholds.

The increase in the industry threshold has slowed down the speed of newcomers understanding of the industry to a certain extent, but it is also an effective screening method. The crypto industry is not only for investment, but also has a lot of infrastructure, and affects many Internet-based segments.

Finally, for now, the threshold for the crypto industry is not particularly high. There are still many channels for learning, and newcomers are not necessarily better than early ones. The main problem is that the knowledge system is relatively fragmented, and a large number of investors think that they understand crypto industry. The main reason why the field is harder to understand is that they are not willing to spend the energy and time.