The 3 crypto narratives

BASE LAYER // Issue #14
Clarity for long-term crypto holders.

GM everyone.

Let’s play a game.

Open Twitter (or your favorite crypto source) and scroll for 30 seconds.

Now count how many “narratives” you see.

ZK rollups.

AI x Crypto.

Modular chains.

Decentralized physical infrastructure networks (whatever that means today).

Welcome to narrative season—where every protocol is solving “the future of the internet” and every founder just dropped a new Medium post that will “redefine the web.”

Here’s the issue:

Most of these aren’t narratives.

They’re noise with better design.

And if you don’t know the difference, you’ll chase trends that vanish faster than your L2 airdrop vesting schedule.

So, what is a real narrative?

Let’s define it cleanly:

A real narrative has three ingredients:

1. Market Alignment

   People want it. The demand exists now or is clearly emerging.

2. Capital Flow

   Builders, VCs, and users are putting real money behind it—not just vibes.

3. Time Horizon

   It’s durable enough to last beyond a two-week Twitter sprint.

Without all three, you’re just speculating on attention, not conviction.

So after years of chasing (and missing) more cycles than I care to admit, I break them down like this:

🫧 1. Momentum Narratives

These are fast, loud, and look amazing—until they collapse.

You know them by:

• Insane price movement with little product

• Influencers aping in on day 3

• Telegram groups that hit 10K overnight

They make you feel like you’re missing out right now.

They rarely last more than a few months.

Example: Most meme coins, AI x Crypto tokens, Layer 1 rotations

✅ Good for: short-term plays if you know the game

⛔ Bad for: holding past the hype cycle

🔁 2. Rotational Narratives

These cycle in and out—DeFi, NFTs, L1s, L2s, etc.

They’ve got staying power but also seasons of hype and dormancy.

The trick with these is timing.

They’ll always come back around, but if you enter at peak euphoria, you’ll ride the downtrend for months.

Example: L2s in 2021 → quiet → back strong in 2024

✅ Good for: buying when they’re boring

⛔ Bad for: buying after everyone else already has

🧱 3. Structural Narratives

These are the quiet ones—the ones that don’t pump immediately.

They’re infrastructure plays, base layer bets, and things people don’t appreciate until they’re essential.

Example: ETH staking. Rollup tooling. On-chain data availability.

✅ Good for: long-term conviction bets

⛔ Bad for: impatient traders who need action now

So, every time you’re tempted to chase a coin, ask yourself:

• What type of narrative is this?

• Am I treating it like it’s structural when it’s actually momentum?

• What’s my edge in timing this move?

If you can’t answer those, don’t enter yet.

Crypto is full of people buying narrative coins based on the wrong narrative type.

That’s how you end up holding exit liquidity thinking you’re early.

Here’s a quick rule of thumb.

If the coin is already up 5x and everyone is tweeting about it:

It’s probably a momentum narrative, not a thesis play.

If no one’s talking about it and the chart looks like a flat line:

It might be a structural narrative—one worth studying deeper.

Most importantly:

Don’t pretend your trades are investments.

Call it what it is, and make your strategy match.

P.S. If you’ve been nodding along, you’ll love the full framework I lay out in the Crypto Clarity Protocol — especially Module 7, where we dig into the asymmetric bet strategy that doesn’t rely on hype to work.

– Alex
Founder, Base Layer