@joycejimmy

Treat sentiment as a short-term amplifier on top of longer-term fundamental trajectories. First, quantify fundamentals: TVL quality (collateral composition), protocol revenue, user retention, and code security (audits, exploits). Then overlay sentiment signals—social buzz, developer PR activity, and on-chain engagement—to explain deviations from fundamentals in price and flows. Use vector autoregression to capture feedback loops where positive sentiment increases flows, which improve fundamentals (fees), which further buoy sentiment. Conversely, model how negative sentiment accelerates withdrawals and revenue drops. Incorporate sentiment into early-warning systems for tokenomics stress testing, but always recalibrate weightings so that durable fundamentals dominate long-horizon valuation while sentiment guides tactical entry and exit timing.

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