Here's what happens when you have dramatic money and asset value expansion
Founders start inventing narratives
The earliest investors assess whether or not a "founder package" can be sold to the next buyer
As venture becomes decoupled from traction, usage, and cash flows
Players in the game of capitalism gravitate away from the more difficult game of creating a good or service that businesses or consumers buy
Players begin gravitating toward the game of package "greater fool equity/tokens hot potato"
Even if 10 teams have the same idea, market, etc
The initial investors are looking for some mix of
(1) traction (ideal but difficult so if there's too much money chasing too few projects with traction then...)
(2) potential traction (operational ability, or belief in founding team to reach 1 traction)
(3) signal and momentum (the "package" can be sold to the next buyer)
As money supply becomes a multiple of money demand for entrepreneurial value creation
More money enters toward 3 on the spectrum 1-2-3
As money becomes more "loose," more money enters toward (2) and (3)
And the focus becomes what looks "good" to the next buyer
This will often be either things that indicate past operational ability (repeat founders) or credentialing (Big tech, Ivy leagues, etc)
The fact that this happens and is happening propagates from sophisticated investors to less sophisticated
This game can keep going so long as [1] there's a bet there is a greater fool or [2] the expansion of money and low interests makes money allocators believe that money will continue to seek risk at ever higher valuations
Until the game is found out by all players
At which point (3) becomes less viable
And people return to back (1) and (2)
There's no one to "blame" here per say, because all the players in the game are just playing the capital game, generate the most capital for the least cost and effort