Governance tokens represent the power to change the rules of the system.

As cryptonetworks grow the value of governing that resource also increases.

Some thoughts on the importance of governance and how the value changes over time. 🧵

1/
2/ Governance tokens typically accrue value in a few ways
• Draw cash flows or fees from the protocol
• Determine protocol incentives and parameters (e.g.
setting inflation/rewards)
• Control key assets on a network (i.e. algorithms, capital, other utility value)
3/ There’s clear value in governance, but, there are currently no clear predictive models for pricing governance tokens without cash flows. It's especially hard to value governance in early networks.

Governance largely holds intangible value, which is hard to accurately price.
4/ As governance becomes more complex, protocols will inevitably require protocol politicians or influencers who advocate for individual tokens in a pool.
5/ Not all governance occurs on-chain – proposals, economic designs, and improvements must happen off-chain before being voted on and implemented. This presents a possible scenario where the value of protocol governance remains off-chain.
6/ The value of governance is clear even if the specific valuation of governance tokens remain uncertain.

As protocols develop and accrue significant capital and users, there will be various parties that fight for control of the systems of tomorrow.
7/ I'm excited about the potential for governance to be more accurately priced into systems and protocols that govern society.

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More from @masonnystrom

1 Feb
Web3 – the decentralized internet – requires democratizing many of the existing services and infrastructure.

Key services include:
• Web Hosting and Data Storage
• Domain Name System
• Internet Access

A thread on the protocols creating Web3👇🏻👇🏻👇🏻
messari.io/article/the-or…
In this piece, I examine the existing challenges to decentralizing the internet and specifically the Internet Infrastructure Stack.

Continue in the thread as I briefly review the existing services and protocols tackling these issues, or jump to the piece for the full story.
1. Data storage and web hosting are vital services for companies.

AWS is the elephant in the room, accounting for about 32% of the market. Beyond the concentration, once AWS revokes hosting services other cloud and storage providers are also likely to reject the entity/website.
Read 16 tweets
22 Jan
Investing like a venture capitalist in crypto has never been easier.

The world of investing in open-source software means public portfolios.

Beyond investors advocating for their projects, their portfolios and active participation strategies can be tracked on-chain.
At a glance, @placeholdervc is one of the largest portfolios tracked on Nansen with over $55 million in tokens.

Many of Placeholder's investments have performed well especially, numeraire ($NMR) since Placeholder invested in NMR in both Mar 2019 and Jun 2020.
The era of on-chain portfolios is only beginning.

As more data becomes available, funds will likely start to make their portfolios more available in order to control their investment narrative and participate in crypto communities.

messari.io/article/invest…
Read 5 tweets
19 Jan
The Creator Economy - is starting its transition to the Community Economy.

The Community Economy – enabled by cryptonetworks and social tokens – incentivizes early followers to use their underutilized skills and assets to support a community or individual.

A quick thread 👇🏻 Image
While the creator economy benefited the lives of millions of creators, the Community Economy will reward early contributors and create the long-awaited middle class of the creator economy. messari.io/article/the-co…
There are two primary issues with the Creator Economy of today:

1️⃣ Early fans that initiate the flywheel of a creator’s community provide greater value to the creator’s growing community than fans who arrive later. Also, newer fans detract from the value that older fans receive. Image
Read 6 tweets
15 Jan
A physical Mickey Mantle baseball trading card sold for $5.2 million yesterday.

What does this mean in the context of non-fungible tokens and NFT portfolio allocation?

A quick thread 👇🏻👇🏻👇🏻
NFTs are better than traditional trading cards.

NFT sports trading cards offer:
• Utility value in fantasy games
• Fractionalization and ownership by a group of collectors
• Collateral asset in smart contracts
• Potential programmed utility in future protocols
The fantasy sports NFTs (e.g. trading card) market is relatively new so let's consider the potential in the context of the legacy trading card market.

The PWCC 100 index, comprised of the top 100 trading cards by highest average market value outperformed the S&P 500 since 2008. Image
Read 6 tweets
11 Jan
All personal tokens will naturally evolve into community tokens.

Since the network size of a personal token is limited to an individual, there is a natural transition from a personal token into a community token as an individual’s audience grows and their brand matures. 1/
2/ Personal tokens transition into community tokens when:
• DAO governs tokens
• Token supply is shifted to a community treasury
• Tokens hold a direct affiliation with an organization
• Revenues from the personal token are meaningfully shared with the token holder community
3/ The point when a personal token becomes a community token is vague but will grow clearer as social token standards further develop.

The early taxonomy for social tokens is starting to form. How social tokens evolve is unknown and therein lies the market opportunity. Image
Read 4 tweets
9 Jan
The world is waking up to NFTs as an asset class.

For anyone looking to read more about NFTs here's a thread of some of my favorite pieces. 👇🏻
.@jbrukh's piece is probably the single best essay to read for understanding the potential of NFTs.
blog.coinfund.io/all-digital-co…
.@ljxie recently wrote an insightful beginners guide for NFTs on @viamirror, which will be a super exciting experiment in valuing internet content.

linda.mirror.xyz/df649d61efb92c…
Read 5 tweets

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