Following my last thread, a few people have asked me about my opinion of $strong. Fwiw, here are my two cents: 🧵

1/ The below tweet, and the one after it, capture my thoughts. And @VirtualKenji has also summed this up beautifully: “how sustainable nodes will be in the future has a lot to do with them finding product-market fit for their next pivots”

2/ Strong’s main plan for revenue is in creating a new L1 blockchain. The success of strong nodes - or rather the sustainability of strong emissions - will clearly depend on the success of Strongchain. I.e. it all depends on whether Strongchain will find PMF.

3/ I have three questions: (1) What is the main value-add of Strongchain? Why would developers choose to build on Strongchain rather than/in addition to other L1s (e.g. $FTM / $AVAX)? (2) Would the dApps / protocols on Strongchain be compelling enough for people to use them?

4/ (3) Can Strongchain be deployed and sufficient revenue be obtained quick enough, so that they can move away from ponzinomics to pay out emissions to node holders?

5/ The longer it takes for them to obtain revenue from Strongchain, the longer they need to rely on ponzinomics to pay out emissions. The longer ponzinomics is relied on, the more likely it is that we see downward pressure on prices.

6/ This is because people invest in projects to make profits. The more time that has elapsed, the more people there are who have compounded nodes, covered their initials and are therefore regularly selling $strong to take profits.

7/ Nevertheless, the takeaway here is to ask yourself the three questions in the third tweet of this thread. If you’re confident in the answers, it means that you’re confident in the team’s ability to find PMF in a 2nd domain. If not, perhaps wait until more info is released.

8/ If you’re interested in doing some more research into Strongchain, @baconesq has put together a useful thread of the info we currently know:

9/ And if you liked this, give us a follow @economiserly where I examine DeFi through an econ lens.

Bonus thread: some additional thoughts on Node protocol sustainability

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