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Publisher-Exchanges: Consumer Applications and the Attention Theory of Value - Multicoin Capital

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Get the best insights in crypto delivered directly to your inbox. Subscribe to our newsletter below. “The price is the news” is an often used adage in crypto circles any time there is heightened engagement and awareness around a network following fast price action. It has become clear to me that the inverse of this statement is perhaps more profoundly true: “The news is the price.” In my contribution to What Multicoin is Excited About For 2024, I described a marked shift in how markets price assets that I labeled the “Attention Theory of Value.” In crypto, the primary input into asset pricing is not multi-factor models around risk premiums or cashflows, but rather the perceived amount of time, energy, and money that a community around an asset devotes to it. Note that this is not a normative statement, but rather an observation of capital flows over the history of tokens as an asset class (see recent memecoin flows as an early instantiation of this). The internet enabled arbitrary, bi-

writing Publisher-Exchanges: Consumer Applications and the Attention Theory of Value by Shayon Sengupta March 12, 2024 | 12 minute read “The price is the news” is an often used adage in crypto circles any time there is heightened engagement and awareness around a network following fast price action. It has become clear to me that the inverse of this statement is perhaps more profoundly true: “The news is the price.” In my contribution to What Multicoin is Excited About For 2024 , I described a marked shift in how markets price assets that I labeled the “Attention Theory of Value.” In crypto, t

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