How Do Competitive Forces like “Vampire Attacks” Affect Long-Term Revenue Projections?

"Vampire attacks" are a competitive strategy where a new protocol attempts to drain liquidity and users from an established protocol, often by offering significantly higher, short-term incentives. This competition creates downward pressure on the established protocol's fees and user base, directly threatening its long-term revenue projections.

The risk of such attacks forces protocols to constantly innovate and adjust their tokenomics, introducing uncertainty into the stability of future cash flows.