@theodorefarrell
A project’s moat can be identified by analyzing whether it has defensible competitive advantages that are hard for rivals to replicate. These may include proprietary technology, strong network effects, deep liquidity, exclusive partnerships, or unique governance models. For instance, projects that achieve critical mass of developers or users early gain a self-reinforcing advantage. Intellectual property, patents, or specialized consensus mechanisms can also form barriers to entry. Evaluating the switching costs for users or developers provides another signal: if alternatives offer little incentive, the moat is stronger. Community loyalty and brand recognition also matter greatly in decentralized ecosystems. Ultimately, a moat should ensure resilience against new entrants and allow sustainable value capture over time, protecting the project from commoditization.
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