Thread by @panekkkk

Thread.

If I were building a mega crypto-incubator, my investment targets would be:

✅Core dev
✅Clients
✅Tooling/doc/education
✅Security/auditing
✅Wallets
✅Fiat ramps/banking
✅OpFi dapps/protocol infra
✅Indexing/querying (e.g., Infura)
✅Ontology/data
🙅‍♂️dapps/ICOs

Such investment requires the mindset of the definite optimist.

It aims for success measured over half-decades not quick wins.

And it requires heavy investment in base layer protocol tokens (particularly for tokens w/ monetary potential) to comprise the majority of future ROI.

Imagine where Ethereum would be today if this was the prioritization of mega-incs on day 1?

Of course, this list comes w/ the benefit of hindsight.

And to Ethereum's credit, the Ethereum "blob" (my term for distributed community) has coalesced/amoeba'd in this in direction.

There are however counter-arguments against such a strategy. @usv argues that apps and infra evolve in responsive cycles, not distinct, separate phases.

This might suggest that focusing largely on infra today is a mistake.

usv.com/blog/the-myth-…

But it's important to ask "where are we in the evolution of the infra stack?".

I believe we're still quite early.

But I also believe that the idea that these cycles are visibly distinct is seemingly correct only in retrospect but in reality incorrect, particularly today.

Reality is messier.

The apps and infra that failed are never shown on historical timelines.

And in a hyper-connected / agile tech / post-Internet world, the window b/w apps and infra cycles is shrinking and thus blurred.

When the Internet first launched, nobody could imagine how it might evolve.

But now we have a model for forward-thinking about such tech.

We've seen how platforms evolve.

We can therefore better forecast the growth of new protocols earlier and with better accuracy.

Cycles will still appear on historical timelines but only because there will be somewhat random periods where successes summed into meaningful bursts of utility.

So why invest in infra?

1. We're still early

Without scale and composability, meaningful apps are limited to OpFi and a few other narrow use cases.

2. I believe in fat protocol/monies

Most ROI of such an incubator will come from the rise in those base assets w/ monetary potential.

https://twitter.com/panekkkk/status/1030877109512749056

3. Web 3.0 is large and complex -- the ocean is too big to boil

Focusing on both infra and apps is likely too broad to manage successfully.

I'll end w/ a prompt:

Why is it that all mega-incubators are launching on new chains?

We need more definite optimists to take the risk of mega-incubating incumbent chains like Ethereum or Bitcoin.

There are decades of infra and app improvements to come and plenty of opportunity for ROI.

But for some reason it's unsexy to seek new frontiers on old platforms.

Instead, we glorify breaking virgin ground.

In the short-term, maybe this fetish proves correct, but in the long-term, it seems likely there will be many mega-incubators that wished they had been brave enough to build new things on old grounds.

One thing to add to "why infra?" list:

4. The stakes of getting the infrastructure "right" are much higher than other platforms because base layers like Ethereum lay the foundation of a new money/value transfer protocol. Security/decentralization/scale are paramount.