Thread by @jaintanay_

My biggest takeaways from @MessariCrypto's Crypto Theses '22, written by @twobitidiot :

I've also made a mindmap to help tie things together
🧵👇🏻...

*High inflation (5%) and late-year interest hikes will be good for crypto in the short term, but risky in the medium term. ⚖

(note - tweets starting with * are predictions made by @twobitidiot which I resonate with)

"We’re going from an internet built on “rented land” with monopoly overlords, to an infinite frontier of new possibilities."

Web3 inevitability = talent x timing x capital

We seem to have all three right now ✅

NFT infrastructure, DAO tooling, and inter-protocol bridges are domains where we can see high growth in the coming year, given how underdeveloped they are. ⛏

The decoupling of cryptos - We’ve gone from “everything is a cryptocurrency” to “actually, there are currencies, fat protocols, Defi apps, distributed computing platforms, NFTs, work-to-earn markets…”

Large capital allocators are continuing to move up the risk curve amidst a negative interest rate backdrop, and most simply cannot afford to ignore crypto anymore. 💸

New capital entering the ecosystem tends to flow in and down, never out. Capital may trickle down to higher beta, emerging tokens, but when it cycles back up, it often doesn’t cycle out (except for taxes). 💰
Instead, it stops at BTC or ETH or SOL or the crypto “blue chips”.

A crypto winter (crash) is expected. Many will lose faith and won’t be able to stomach the soul crushing multi-year grind lower that is a crypto winter. Crypto can always go lower than you think, for longer than you think, and it will. ❄

Foundational web3 companies building indispensable products with big warchests will likely survive the winter.
The get rich quick crowd will evaporate, but the next cycle’s unicorns will get built during the doldrums of winter.

10 year and 10 hour thinking only.

*Bitcoin is still the 👑 and it's unlikely that ETH flippening will happen in this cycle.

Defi provided the throughput inftrastructure to enable NFTs rapid growth. NFTs + DAO growth called for more scalable L1 and L2 blockchains. This will spur growth of DAO infra in '22 🚀

NFTs provide on-chain identity 🔐 and reputation for DAO contributors; DeFi gives DAO members massive liquid pools of capital to govern; and scaling solutions will make on-chain governance economically feasible.

NFTs - digital goods of the new economy 📈
NFTs are cool because they represent verifiably scarce, portable, and programmable pieces of digital property.

NFTs can, should, and will transcend their underlying blockchains and metaverses. NFTs are still less than 1% of the physical art
market, and digital art is just one tenth of the total NFT market.
This pattern looks like early BTC days...

*The digital art / NFT market crash will eventually be even more nauseating than the 2015
bitcoin bear market

If enough people associate your digital self with a given avatar it does become part of your
identity. 💡

“Win and help win” is a good model for fans and the famous alike, and it’s something that applies to smaller
creators with much smaller audiences (“1000 true fans”) as well.

Our physical survival depends on the decentralization of hardware. The war against censorship resistance will be fought in the cloud, & how effectively we wrest control of that infra from today’s dominant monopolies will be the diff between an open internet, & a police state. ⌨

A truly decentralized internet also requires permissionless and censorship-resistant hardware networks that
support computation and networking.

DeFi 2.0 - the web3 financial plumbing 🔌

USDT is the bridge to mainstream adoption. 🌉

*The centralized exchanges’ perpetuals volumes dominate spot volumes, and I’d expect DeFi will be no different.

ETH, Layers and bridges will get these blockchains out of their silos and spur interoperability 🧩

Realise we can do this 👇🏻

JPMorgan projects that staking will be a $40 billion / year industry by 2025. But it comes with an opportunity cost- Locking assets to participate in network validation, prevents these assets from being used in other parts of the ecosystem.

We may have hundreds, or thousands of application-specific “rollups” or “parachains” or “zones”, but we won’t have hundreds of L0/L1/L2 standards. As Ramshreyas wrote, major tech platforms tend to trend towards duopolies.

DAOs - 'digitally native communities that center
around a shared mission.” 🏛 #Layer3recap

Giving communities better treasury analytics could greatly improve their governance decision making process. And not just that, there is also a lack of professional treasury managers.

The DAO production companies provide financing, project direction,
and assemble the teams. Those teams sprints on gigs, develops their personal bona fides, then disassemble, and move on to the next. 🏗

The big DAOs will be sticky employers, but most DAOs (including subDAOs to the bigger DAOs!) will be more fluid. The key difference in the Web3 “Hollywood” model is that each
contributor - no matter how small - can retain royalties tied to the product’s ongoing success.

DeFi (manage tokens) + NFTs (digital identity) + L1-L2 bridges (navigate across communities) = Reorganization of society around token governed communities 🔓

Thank you for reading this long thread! Please RT and like if you learned something new :)
Do drop me a follow as I plan to out a lot more content on twitter for 2022⚡! WAGMI 💪🏻

cc - @MessariCrypto @SahilBloom @gregisenberg @balajis @cdixon @PareenL @naval @RyanSAdams @trustlessstate @sandeepnailwal @_jdkanani @thetanmay @athrvakhrbde @Mudit__Gupta

Thank you @twobitidiot for writing this theses!

P.S - I haven't fully covered the sections on Bitcoin, USA Policy, Market Infrastructure and top 10 people to watch in this thread.

Also realise that this is a condensation of a 165pg theses so obviously there's a LOT more where that came from

Report-
messari.io/pdf/messari-re…