Emin Gun Sirer, CEO of Ava Labs, has highlighted the pink flags customers ought to contemplate earlier than investing in new L2 tasks within the upcoming cycle. In accordance with Sirer, ignoring these pink flags may result in an end result just like what occurred with Sam Bankman-Fried, whom many individuals adopted based mostly on superficial traits.
Hey y’all,
All of us ignored the massive pink flags related to SBF as a result of “he seemed sensible” and “he made some huge cash.” Then it turned out that he was dumb as rocks, was a sociopath, and was simply stealing our cash.
The following cycle goes to be much more noisy, with even…
— Emin Gün Sirer🔺 (@el33th4xor) March 23, 2024
Sirer listed the pink flags by way of a current put up on X, noting the absence of a story that matches the mission tech as the primary sign of unsustainability. For example, he believes centralized sequencers and L2s that lack fraud proofs are unsustainable and are at odds with crypto.
The Ava Labs founder doesn’t help tasks that promote tokens now to lift cash to do the work that may result in one other expertise later. In accordance with him, the third prong of the Howey Check qualifies such workout routines as Safety Choices.
In continuation, Sirer in contrast founders who dump private tokens pre-launch with Bankman-Fried. He believes their traits are related, with probably the identical outcomes. He additional famous that 8-figure gross sales pre-launch to “thank the workers” are about the identical as Bankman-Fried stealing customers’ cash as a result of he’s an “efficient altruist.”
Sirer thinks tasks with low-float tokens are dangerous and unsustainable. He cited Bankman-Fried’s sample of manipulating low-float token valuations and borrowing in opposition to them for example customers ought to study from. Moreover, the blockchain skilled suggested customers to not overlook founders’ behavioral patterns. For example, “founders complaining that they’re operating out of cocaine” is a sign nobody ought to take evenly.
The Ava Labs founder defined how crypto customers can check new tasks for authenticity. He famous crypto has only a few genuine blockers at a time. For example, scalability and efficiency had been the excellent issues within the final cycle, and Avalanche and Solana supplied two approaches to deal with them.
Sirer believes the blockers for this cycle blockers should do with supporting a number of use instances on the identical platform and integrating with TradFi. He suggested customers to probe new tasks to see if they create one thing game-changing to deal with the numerous points going through crypto.
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