Naval Warns That ‘Getting Rich Too Early’ Dooms Many Crypto Startups

• Naval notes early wealth hinders crypto founders’ ability to recruit and sustain growth.
• Many crypto projects lack practical utility, challenging long-term user adoption and relevance.
• Technical and marketing issues are major barriers to scalability and user engagement in crypto.

The crypto market keeps growing and changing. But, leading Silicon Valley investor Naval Ravikant says most crypto projects will fail. In a post on X (formerly Twitter), Naval said many crypto projects fail because founding teams get rich too quickly.

This early success can make it harder to attract new talent, which hurts a project’s chances for long-term success and innovation. Responding to Naval, Kyle Samani, founder of the venture capital firm Multicoin, said the best founders are driven by vision, not money.

Naval Ravikant is a big name in Silicon Valley. He has invested in major platforms like Twitter and Uber. He also founded AngelList, an equity crowdfunding platform that helped many successful startups.

Many crypto projects fail because they aren’t useful. Many tokens launch with big promises but don’t have a clear use or purpose.

This lack of real-world use makes it hard for projects to build a strong user base. This leaves them exposed in a volatile market. Without a sustainable business model or a clear vision for how their tokens will help users, many projects can’t stay relevant.

Read also: 2017 ICO Retrospective: Winners, Losers, and Lessons for Investors

Also, projects that rely only on initial coin offerings (ICOs) or speculative investments usually don’t last. These strategies can bring early attention and funding, but they often don’t create lasting value.

Scaling a blockchain project to handle lots of transactions, ensure security, and provide a good user experience is tough. Many startups struggle to achieve this level of technical sophistication.

Marketing is also key to the success of crypto projects. The market is competitive, so a strong marketing strategy is essential for building awareness and getting users.