The economist Benjamin Graham, known to some as the father of value investing, once compared the market to a voting machine in the short run and a weighing machine in the long run. While Graham likely would have been skeptical at best about crypto and its built-in volatility had he lived to see it, his economic theory nevertheless applies to certain aspects therein.
Since the emergence of altcoins, the blockchain space has operated almost exclusively as a “voting machine.” Many projects have, by and large, been financially unsuccessful and even detrimental to investors and the space at large. They have, instead, turned crypto into a memelord popularity contest, and their success on that front can hardly be understated. Sometimes that competition is based on who promises the best future use case — but whether that future actually arrives is another issue altogether. Often it’s based on who markets themselves best, through sophisticated-looking infographics or ridiculous token names and a series of associated “dank” memes. Whatever it is, the success of the majority of projects is based on speculation and little else. This is what Graham was referring to as that “voting machine.”
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