Talking about Buterin’s paper, a16z encryption market status report and web3’s LinkedIn platform

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I read two web3 related reports this week, one is Decentralized Society: Finding Web3’s Soul ; the other is a16z’s “ 2022 Crypto Market Status Report Introducing the 2022 State” of Crypto Report” , briefly summarizes the essence of the report.
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– The current web3 focuses on asset transactions and financialization, but does not focus on addressing trust issues in social relationships. But the vast majority of our core economic activities, such as unsecured lending and building personal brands, are based on lasting and non-transferable social relationships. Buterin proposes to launch “soulbound tokens (SBTs)” in the future, which are NFTs that are never transferable and will permanently exist in your Soul wallet as proof of participation and reputation.

– E. Glen Weyl, co-author of the paper by Buterin, said that SBT will be put into use in the market by the end of 2022, and will usher in an upward cycle in 2024.

– What is the practical significance of NFTs that are never transferable? ①Universities can offer SBT degrees to graduates, which cannot be transferred or sold. ② A company is trying to hire someone who has attended X conference, because X conference issued SBT badges to attendees, and no one can buy badges on the open market. The company can then screen and verify candidates for meeting X. ③ The DAO community can airdrop SBT to participants. Attendees and graduates of environmental projects.

– Buterin and his team believe that web3 scammers and counterfeiters emerge in an endless stream, and having real on-chain credentials is the key and soul of building a “Decentralized Society (DeSoc)”. And SBT will enhance governance mechanisms, encourage trust and cooperation between communities, while protecting the network from capture and domination. With this enhanced sociality, web3 can abandon the current over-financialization and opt for a more transformative and diverse future.

Butterfly Report Full Version: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4105763

#1 We are in the middle of the fourth “price-innovation cycle”.
Markets have rhythms, and cryptocurrencies are no exception. While cryptocurrencies are volatile and chaotic for the time being, as a16z partner Chris Dixon and cryptocurrency engineer Eddy Lazzarin first pointed out in 2020, there is an underlying logic to cryptocurrency market cycles.

Whereas in many industries price tends to be a lagging indicator of performance, in cryptocurrencies, price is a leading indicator, acting like a hook to raise interest and drive cryptocurrency projects, which in turn drives innovation, which we call this This feedback loop is the “price-innovation cycle”. The cycle has been a powerful engine that has propelled the cryptocurrency industry since the inception of Bitcoin in 2009.

As legendary investor Benjamin Graham once said, it’s best to ignore “Mr. Market,” who often gyrates between exuberance and euphoria and despair and depression. So in the current market situation, the best response is to “build the Build”. Think of the founders who swore off tech and the internet in the early 2000s because of the dot-com bubble, missing out on the best opportunities for the next decade: cloud computing, social networking, streaming video, smartphones, etc. Wait. Now is the time to think about what similar cases will be in web3 and what founders and creators can stand up to the pressure and continue to build what they think will work.

#2 web3 is so much better for creators than web2!
After data statistics and analysis, the a16z team found that in 2021, the primary sales of Ethereum-based NFTs (ERC-721 and ERC-1155) and the royalties paid to creators for the secondary market sales of OpenSea totaled $3.9 billion, with an average of $3.9 billion per creator. Those who can earn $174,000. While Spotify and YouTube pay creators more in absolute numbers ($7 billion and $15 billion, respectively), the per capita gap is staggering, with Spotify paying an average of $636 per artist, YouTube averaging Paid $2.47 per channel. Although the current web3 creators are still small, they are extremely powerful.

#3 Cryptography (Crypto) is having a huge impact on our real world.
Compensation for creators is just one example of the benefits of cryptography, let’s look at the financial system again. According to the World Bank report, more than 1.7 billion people in the world are unbanked, and 1 billion of these people have mobile phones, and cryptocurrencies provide them with access to financial services.

Encryption technology can also solve the problem of information transparency and traceability. People no longer need to rely on centralized large enterprises as intermediaries, but can actively master their own data and information, and are no longer under the control of giants such as Google and Meta. At the same time, the birth of the Decentralized Autonomous Organization (DAO) shows us how strangers can coordinate and cooperate to achieve their goals through smart contracts. Encryption is far more than a financial innovation, it is a social, cultural and technological innovation.

#4 Ethereum dominates web3 but also faces competition.
Ethereum’s lead has a lot to do with its early start, and it also has a healthy and growing community. Ethereum currently has the most builders, with nearly 4,000 monthly active developers, followed by Solana (with nearly 1,000) and Bitcoin (about 500).

Ethereum’s overwhelming dominance may explain why users on average are willing to pay more than $15 million per day to use the Ethereum blockchain. But its popularity is a double-edged sword. Since Ethereum has historically focused on decentralization rather than accelerated scaling, other blockchains such as Solana, Polygon, BNB Chain, Avalanche and Fantom will attract users with better performance and lower fees.

At the same time, we have also seen the rapid development of cross-chain transactions and second-layer technologies. The current blockchain technology is like personal computers in the 90s and broadband in the 2000s. There is still a lot of room for development and innovation, and more winners are bound to emerge in this field.

#5 Yes, we are still in the early stages.
Although it is difficult to know the exact number of web3 users, it is possible to estimate the approximate size. According to various on-chain metrics, there are around 7 million to 50 million active Ethereum users today. In analogy to the development of the early commercial Internet, we seem to be around 1995, and the Internet reached 1 billion users in 2005. Just as web2 was starting to take shape, future giants like Facebook and YouTube were just beginning to emerge. If our predicted trends are correct , web3 will reach 1 billion users by 2031. In other words, if you are already in web3 now, you are ahead of the vast majority of people, we still have a lot of work to do, let’s keep building!

a16z report full version: https://a16zcrypto.com/state-of-crypto-report-a16z-2022/

I still remember that when I was a graduate student, I followed the advice of my mentor and set up a complete LinkedIn page , which was discovered by the headhunters of Air New Zealand and got a job offer right after graduation. After ten years, I have watched the number of contacts on my LinkedIn increase day by day, and everyone is “showing off” their work achievements. This platform that helped me at the beginning has now evolved to be the same as FB and IG, full of With superficial relationships and whitewashed life trivialities. Our world is changing at an alarming rate, but traditional web2 platforms have not been able to keep up, especially in the workplace. Our work is becoming more and more personal, and there are countless hidden talents around us. In the ecological environment of web3, is there a workplace platform like LinkedIn that can discover high-potential talents and find them in their place? To establish a link between?

Last year, I discovered a project called Talent Protocol (hereinafter referred to as TP, the founder hopes that TP can become the LinkedIn of web3), by introducing the concept of social token (Social Token), it helps talents to create personal resumes on the chain, And get financial support by selling personal tokens (saying my $CAM token has now exceeded the thousand-yuan mark, welcome to support hahaha). The project is only a year old and has raised $2.65 million (company valuation around $50 million) from funds such as Protocol Labs and Flori Ventures and angel investors such as Alex Masmej and Rene Reinsberg.

At present, there is a widespread problem of talent abuse in Western society. Many talented teenagers have to carry heavy student loan debts, work day and night as an intern in investment banks, and waste their creativity and unlimited potential. The meaning of TP’s existence is to find these young people with subjective initiative, through community investment and a series of incentive measures, to liberate them from traditional work, and to do what they are interested in without worrying about their livelihood. s project.

Last month, TP provided free airfare and room and board to more than 20 young people active on web3 to attend the Celo Connect conference in Barcelona. I was also fortunate to meet a group of young entrepreneurs from Russia, Brazil, Canada, the United States, Portugal, Spain and other places. In the process of talking with them, I was always impressed by their professional ability and vigorous vitality. One of the 19-year-olds also gave me some advice on running a media company and invited me to speak to his community. In the world of web3, there are no age and national boundaries, and everyone has a common aspiration to create a better future in the process of collaboration. TP will sponsor web3 practitioners to attend the EthCC conference in Paris in July this year, free application form?
https://talentprotocol.typeform.com/talenthouse2?typeform-source=t.co

According to Filipe Macedo, co-founder and chief marketing officer of TP, Talent Tokens are a form of social tokens whose value is linked to the issuer’s influence and community support. For example, let’s say Ronaldo issued $CR7 tokens, he can stipulate that people with 10 $CR7 can get autographed photos, people with 100 $CR7 can get game tickets, and people with 1000 $CR7 can and He talks face to face.

In 2021, the total market capitalization of all social tokens in the world will exceed $303 million, a 500% increase from the same period last year. Talent tokens are all about treating individuals as joint stock companies, and through financing, both talent and their backers receive dividends over time. Launching a talent token is like an initial public offering (IPO), raising money to finance a project or pay off student loans, with the ability to say “F*** off” to a pesky boss. As a supporter of talent, investing in other people’s tokens in addition to unlocking exclusive benefits ( when the talent you invest in is successful, their benefits will also become more valuable, and the value of the token will increase) , your reputation It will also increase, just like Peter Thiel’s early success investing in FB and LinkedIn, you can gain a reputation for investing in talent. Anyone who launches a talent token on TP will appear on the homepage and promote it to relevant investors, and the platform will also use incentives to recruit talents in the community. If you find the next Ronaldo around, you will also Get rewarded for referring this person.

Over the course of one year of TP’s operation, more than 1,000 investors have invested $450,000 in 310 talents. At present, the talent pool is still in the internal testing stage, and applications are not open to the public. There are still several major problems to be solved:

– People are a particularly big change factor, and the stability of talent tokens will also be affected because of this. When a person fails to achieve the plans and goals he assured investors, will their tokens face collapse? Do talents face personal danger because of broken trust?

– All financial products have speculation and risks. How to design a mature financial product around talent to create the greatest positive impact is also an issue that TP is exploring to ensure that supporters buy talent tokens with good intentions, while Not to make quick money.

Log in to https://www.talentprotocol.com/ for specific information about the project or join Discord for a private beta invitation.