Cold thinking: How can the project party find the right "ecological niche"?

Author: Haotian

What should a good project’s “ecological niche” be like? Recently, after deep discussions with some bosses, I found that most projects have not identified their ecological niche correctly:

1. The technical threshold is high, but there must be deep application scenarios. For example, ZK zero-knowledge proofs can be used for zkVM, cross-chain bridges, and verifiable computing, but considering the overall cost and efficiency, currently only zk-Rollup layer 2 scaling has been successfully implemented. Other directions do not have deep application scenarios; no matter how advanced the technology is, it remains a castle in the air.

The FHE technology of Mind Network seems to have a high threshold, but in reality, there has been a lack of application scenarios. Most projects working on ZK co-processors also face this issue.

2. Market demand must be grounded in reality, not driven by assumptions. Some projects often hypothesize that if 1% of users use our product, the commercial potential will be enormous. However, in reality, even this 1% demand may be fabricated.

Huma focuses on accounts receivable and cross-border payments in PayFi, and given the compliance background, it seems reliable. But those projects claiming to create a “decentralized Stripe,” what is wrong with traditional payments?

3. The business model should be able to bridge between B2B and B2C. Pure B2C enjoys the Fomo dividends but cannot survive the winter; pure B2B leaves retail investors feeling excluded, with high marketing costs. The smartest approach is to have both sides involved, with institutions paying and retail investors recognizing value, in order to navigate through cycles.

Backpack wallet + exchange + NFT community, catering to both institutions and retail investors. Particle’s blockchain abstraction + application products also consider both B2B and B2C. In contrast, those projects that purely focus on infra, often needing to build a full-chain DA layer, can only rely on institutional blood transfusions;

4. The business vision only needs to be “unfalsifiable”, don’t be greedy. What does it mean to be unfalsifiable? You won’t be able to prove me wrong anytime soon. Some Layer 2 projects always say that “it only takes one wave of mass adoption to explode”, and the prospect of such a grand vision that cannot be verified in the short term is equal to no prospect.

KaitoAI may not actually be an AI company, but it has tapped into the business gap of attention economy for KOLs and project parties, which gives it a certain unfalsifiability. Stop casually saying you want to “redefine XXX”;

5. Timing is crucial. The intersection of the three variables: technological maturity, market education, and competitive landscape, is the time window. Why is AI Agent popular now? LLM is sufficient, TEE has matured, and user acceptance has risen. Three years ago, discussing AI disrupting everything was purely motivational talk.

Amid the Solana MEME craze, there are still projects focusing on GameFi, hoping to attract attention through sector rotation. Considering the operational logic behind MEME, it’s clear why projects like games, which have slow implementation and long cycles, fail to get into the spotlight.

6. The ecosystem must have self-growth attributes and cannot rely solely on operations for promotion. Airdrops attract users, and grants subsidize developers; these are merely starting tactics. The true network effect is that the more users there are, the greater the value, and the more developers there are, the stronger the ecosystem.

Where are the real users of those layer2s that maintain their popularity through point battles, from zkSync, Scroll to Linea, after getting rid of the token grabbers?