Chapter 11: Vetting a New Blockchain Protocol Or Project

“In the short term, the market is a popularity contest. In the long term, the market is a weighing machine.” - Warren buffet

“A good decision is based on knowledge and not on numbers.”


Not all blockchains protocols or blockchain projects are anywhere near the same level of quality or decentralization. Not all “blockchains” protocols are even really decentralized blockchains in the real sense of the word. The term has often been used indiscriminately, deliberately misleading users into a false sense of safety and security with a potential investment. It is quite common for development teams to label a protocol or a project as a “blockchain” - even when, in reality, it is a highly centralized operation controlled by a single company or handful or individuals.

The purpose of this chapter is to break down the marketplace and provide a useful set of tools we call the Blockchain 2035 Rubric for analyzing and evaluating various blockchain projects and protocols. We’ll start where most people new to blockchain and cryptocurrency start: market capitalization and how misleading this metric is in the blockchain industry.

The Market Cap Fallacy

Quite often, the first metric people use for evaluating a blockchain when they are new to this space is the simple US dollar amount associated with a projects’ market cap valuation. They go to and look at the top 10 or 20 projects thinking they must be the best projects to invest in and start there. While this approach seems simple and straightforward, it is a massive blunder for newcomers to make...

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