Yes, you can earn Crypto and NFTs by playing games in web3.
With crypto games like Axie Infinity generating multiple millions of dollars in revenue per month, it is difficult to ignore the numbers.
Whether or not you want to play games simply for fun or to earn money, wouldn’t it be great if games could optimizes for both?
Whereas Axie Infinity is considered a “Play to Earn” game, an innovative team from Australia has come up with a better model – Play to Own
Play to Own games bring a new framework to crypto and NFT gaming in which playability is taken into account before the money making aspects.
The Play to Own model seeks to establish a fun and engaging environment for players first and foremost. Without this aspect, NFT based crypto games are not sustainable.
What is Play-To-Own Gaming?
Play-to-Own games are attractive to players because it is possible to earn financial rewards within the game, as well as freely trade items and tokens outside of the game.
These unique features are enabled by blockchain technology.
Play-to-Own is different from the popular “Play-to-Earn” gaming model.
Play-to-Earn is actually an unsustainable game model because people will use the game solely to extract money.
This is bad for the game because no value is organically flowing back into the game.
Play-to-Own games are a better model because they place the in-game experience ahead of financial incentives. People before profits.
Play to own is not about making money. It’s about making memories. Steve Woody
The difference with Play-to-Own is that the game creates a place where people go just because they enjoy playing.
The ability for players to own and trade tokens and items is simply a means to enhance the game, enabling people to continue playing the game for fun. 
Of course, users can decide to cash out and sell their tokens and items if they decide to quit playing.
When players have this enhanced level of freedom to leave with their rewards at any time, game developers are incentivized to develop a truly great game where people want to stick around and interact with each other.
When the primary focus is making the game / product great, the downstream impact is a fun game with great financial incentives as well.
For a blockchain game to succeed with crypto and NFT economics, there must be a balance of players who play for the sake of enjoyment with those who play solely to earn money and convert the token into fiat.
For a play-to-own game to work, there must be an active cohort of players consistently being a part of the game and helping to build a bit of “community”.
Sunflower Land is an example of a Play-to-Own game that does a good job of this.
Sunflower Land Community:
As developers seek to maximize fun and enjoyment for gamers, communities form.
As with almost all web3 projects, value follows community, and community follows utility.
If the game is fun and engaging, a community could naturally form around the game itself.
The larger the community, the larger the network effects and thus the more valuable the entire ecosystem becomes.
Sunflower Land has a strong community where people from around the world come together to discuss the game.
GitHub: Sunflower Land has an active developer ecosystem and is thus still being developed and improved. The roadmap has quite a few exciting features on the horizon.
Discord: the Sunflower Land Discord group is extremely active and with FAQ’s describing common fixes as well as a support ticketing system for technical issues.
The bull case for Sunflower Land: Community Oriented Developers and Founders
Sunflower Land is unlike other crypto games because there was no pre-sale/pre-mine of the SFL token.
Additionally, the game is completely open source, and community run at its core.
As described by the documentation under “Tokenomics”, the team of developers have a commitment to ensuring this aspect of the game remains true:
“We are paid directly with the fees generated by the player driven economy. We succeed when people play and our goal is to design tokenomics that engage users for the long term.” 
When you purchase crypto for the first time, you will probably use an exchange.
While centralized exchanges have a number of benefits, you often do not have direct control over your digital assets when keeping them there.
Establishing your own self-custodial crypto wallet enables you to access dapps, transact in crypto, trade NFTs, as well as attain greater control and sovereignty over your money.
For this reason, its a good idea to move some of your crypto off the centralized exchange and into your own non-custodial wallet.
The next step is actually getting your first real crypto wallet setup. The good news is you can access the blockchain from any wallet provider. Think of the wallet as your portal to the world of web3. Yes, some portals are better than others, but at the end of the day they should all take you to the same place.
There are 4 wallets that stand out from the rest of the market as being the best:
Tokens Supported: Supports 53 blockchains and over 53 million different assets.
Ease of use:
Easy to use compared to most crypto wallets.
As with any new system, it takes some getting used to but there are many instructional guides available.
Includes a Dapp browser which lets you connect to various web3 tools and dapps.
Devices Supported: Mobile crypto wallet
168,000 reviews in the app store
has a very active user community with forums and comments where community members discuss topics and answer questions.
Displays images of your NFTs readily, as well as enables you to send and receive them.
Only displays NFTs from within the Ethereum Ecosystem. Not compatible with Solana NFTs, for example.
Direct Deposit: you can buy crypto using your credit card.
Staking: you can earn 11% APR on quite a few different coins.
Trust Wallet Overview:
For the general user, Trust wallet is great because it has a huge community, open forum discussion, and supports one of the largest number of different assets of any wallet on the market.
For the user looking to stake crypto, you can earn a sizable yield on your assets as well.
From owning some of the most well-known blue-chip assets, to buying and trading NFTs on the Ethereum Ecosystem, as well as browsing dapps within the web3 internet, the Trust wallet provides a well-rounded experience within crypto and NFTs for any user.
2. Best Beginner-Friendly Crypto / NFT Wallet: Coinbase Wallet
Tokens Supported: The Coinbase wallet supports popular tokens like BTC, ETH, BCH, LTC, XRP, XLM, and DOGE, all EVM-compatible and ERC 20 tokens, as well as some stable-coins like DAI. (read more)
Ease of use:
User friendly and easy to learn.
There are many instructional videos on YouTube to help new users learn the ropes.
Supports dark mode.
Devices Supported: Browser and Mobile crypto wallet
103,000 app store reviews.
One of the most popular and well-known crypto exchanges has a large team behind the product.
Publicly traded company
NFTs supported and displayed.
Direct Deposit: support credit / debit direct purchases for crypto. Easy cash on ramp
Staking: Earn interest via smart contracts.
Multisig: not supported
Anything else? view crypto price movements directly from the app.
Coinbase Wallet Overview:
One of the largest publicly traded crypto exchanges in the world has a non-custodial wallet available for download.
The Coinbase wallet is best for beginners because it enables you to link your existing account on Coinbase.com to your self-custody wallet in order to move some of your funds off exchange.
Having the big tokens supported like Ethereum and Bitcoin as well as Polygon is key. Although it doesn’t have as many coins available as other wallets, it is great for getting started.
As staking is supported, this is a good opportunity for beginners to learn a bit more about DeFi and experience earning some yield on their assets, if that is within your risk tolerance.
One of the downsides to Coinbase is that you can’t use it in some jurisdictions, like Hawaii.
3. Best Crypto Wallets for Security: Hardware Wallets (Ledger Nano X)
Ledger Nano X Wallet Specs:
Custodial / Non-Custodial: non-custodial
Hot or Cold Storage? Cold
Most secure hardware / cold storage. Open Source. Keeping your coins and NFTs offline and protected.
Tokens Supported: over 5,500 tokens supported
Ease of use: Setting up the Nano Ledger X takes less than 30 minutes.
Mobile friendly via bluetooth connection. Bluetooth enabled, access your wallet via your phone.
Install up to 100 dapps at a time.
You also have access to the Ledger Live, a browser and mobile wallet that enables you to access your funds on the go, if you don’t want to bring your physical hardware wallet with you.
Ledger wallets have thousands of reviews on Amazon.
There is a community on Reddit with over 86,000 members.
Ledger Academy provides intro information for people to learn about crypto, such as how to keep their assets safe.
NFT Compatibility: does not display your NFTs
Direct Deposit: no
Ledger Nano X Wallet Overview
Ledger, a French company, has a number of hardware products designed to store crypto and NFTs in the most secure way possible.
The only real difference among the Ledger line of products is the number of features like which assets are supported. From a security perspective, all hardware wallets are equally secure because they keep your assets offline, aka in “cold storage”.
Ledger Nano X is the most advanced, and robust wallet from the Ledger line of products.
Granted security is of top priority here, the Nano X supports the most tokens and has the best screen display for usability.
4. Best Crypto Wallets for Ethereum Ecosystem: Metamask
Metamask Wallet Specs:
Custodial / Non-Custodial: non-custodial
Hot or Cold Storage? Hot
Most popular wallet to use in the Ethereum ecosystem, enabling you to connect to web3 dapps as well as EVM powered networks such as Polygon and Optimism. Open Source. Your coins and NFTs are easily accessible.
Tokens Supported: all ERC-20 tokens and EVM compatible NFTs (ERC-721 and ERC-1155)
Ease of use: Quick setup, many tutorials online as well as instructional how-to’s in the Metamask support site. As with all self-custodial wallets, make sure you store your private key in a safe, secure location.
Browser and Mobile enabled. Access your wallet via computer or your phone.
Most popular web3 wallet to date with more than 21 million active users.
Displays your NFTs on mobile, but the functionality could be improved.
As the NFT display system is not optimized, Metamask users often find themselves going to OpenSea or Quixotic to view their NFT portfolios as opposed to the wallet display.
Direct Deposit: yes, via credit card, however transaction fees can be high.
Metamask Wallet Overview
Metamask, an open-source software wallet built by Consensys, is by far the most popular wallet by user count in web3 as of 2022.
The wallet is focused on crypto and NFTs that leverage the Ethereum protocols, ERC-20, ERC-721, and ERC-1155. Additionally, the ability to add Ethereum Virtual Machine networks to your wallet makes bridging to layer 2 rollups easy and user-friendly.
For people that want to explore the emerging world of web3 decentralized applications (dapps), using a Metamask wallet is the way to go.
One of the hottest trending topics on the internet over the last few months has been NFTs.
not investment / not financial advice. do ur own research.
NFTs are digital collectibles that usually give the owner some sort of exclusive access – whether to artwork, discord groups, or even in-person events. Anyone can create and launch an NFT, in the same way that anyone can start a business and sell a product or service, but with NFTs, the underlying value of the asset is based on rarity, utility, and social hype. Those who want to be a part of a niche community are able to prove their ownership by having the NFT.
While any industry experiencing exponential growth will attract questionable (i.e. scam) projects, those of us who are long-term bullish on NFTs and crypto focus on the fundamentals and maintain ownership in NFT projects with competent teams and strong communities.
My involvement with NFTs over the last few months has been complicated. I’ve been largely focused on my day job and, when the waves are good, sneaking out to surf while trying not to forget about my responsibilities. Investing has always been a long-term play and something I don’t feel the need to make changes to very often. Besides, everyone in the Ethereum community is patiently waiting for the Merge.
My NFT Plays:
As always, NONE of this is advice, guidance, or suggestions. Please don’t take anything here as investment advice and always do your own research.
The seven NFTs cost me $5,766.92 – and, according to estimates based on floor price, I’ve lost about $505.98 on paper when you include transaction fees.
Despite losing money in some areas, the projects below are the ones I’ve chosen to hold for the long term. Whether that means during a bear market or bull, I believe in these projects for the reasons I’ll share below.
That being said, its time to shill some NFTs:
1. Surf Punks NFT
After hearing about an NFT that gives holders access to surf sessions at wave pools around the world, I was interested. Seeing Koa Smith post something about it on Instagram as well as involvement from YouTubers like Nathan Florence made me realize there was a significant amount of hype behind the project.
Given that this would be my first NFT and mint was happening the following day, figuring out how to move funds to Metamask was a challenge of its own.
My initiation to the NFT game became hard-won when the exchange wouldn’t let me move funds. Familiarizing myself with the intricacies of web3 wallets via trial and error, I finally secured the 0.15 ETH for mint plus extra for transactions fees.
After minting surf punk 246 for 0.15 eth pre-reveal, I later purchased my second Surf Punk, number 273, for 0.69 ETH. The advantage of owning two Surf Punks is that you can bring a friend to events.
Months later and @TheSurfPunks community has been growing at a pace that feels organic. I’ve met and surfed with other holders in Hawaii, hosted Twitter spaces and spoken with the founder Andre, and the Surf Punks treasury has reserved the entire Waco, Texas wave pool for a private holder-only event in March.
2. Ranchy Rednecks
Twitter Spaces definitely become a source of edu-tainment about NFTs for hundreds of people every day including myself. One evening in December, during the Late Night Degens Twitter space, 3LAU, Steve Aoki, and like 500 other people helped 13 year old Nick sell out his NFT project in 2 hours.
The excitement that everyone had during that Twitter space was too much to not want to be part of it. So I decided to get in at mint price. Unlike my Surf Punks mint, I elected to mint two of these from the beginning.
I believe that purchasing two or three of an NFT in which you have conviction is a better move than buying just one because if it pops, you’re going to want to sell one to take profits and still be a part of the community. Owning more than one allows you to do that.
3. Ethereum Name Service (ENS) Names
After I learned that the .eth extensions would serve as your web3 username and wallet address, I immediately needed one.
As someone who builds websites and is a proponent of owning your own domain name / internet identity, the vision of ENS really makes sense, similar to the .com top level domain names of the traditional internet.
I purchased two ENS:
Epigenome.eth – after doing cancer research in college and majoring in chem, I believe in epigenetics as one of the key industries to help cure diseases and even extend human life one day.
LNR.eth – means love n respect; 3-letter ENS names are quite rare. With only 17,576 combinations, there’s a good chance that the 3-letter ENS names become more valuable as more people are onboarded to web3.
The way it works is that users pay to register and extend registration of the ENS name. Prices are currently set at $5/year for names 5 characters or longer, $160/year for names 4 characters in length, and $640/year for names 3 characters in length.
I do believe that ENS names will become much more valuable as web3 gains traction and becomes more ubiquitous – like many areas of web3, we’re still so early.
Additionally, ENS Domains were launched April 2017 – before Curio Cards and even CryptoPunks. Historical NFTs – that is, those first few NFT projects between 2015 and 2019 – are more valuable to some people because they were first and are thus are more original, more authentic, and more rare.
ENS is undoubtedly an OG NFT and depending which one you own, may become super valuable some day.
The floor price of various ENS names on OpenSea is around 0.006 eth as of 3/13/22, with sales in the last day of as much as 1 ETH.
Purposefully under-estimating the floor price as 0 in my Spending History Table at the bottom provides a realistic viewpoint and helps ensure I don’t over-inflate my own expectations of the portfolio.
4. Kooks NFT (number 69)
This NFT is unique in that it was a whitelist gift, and there was no cost or transaction fees associated with acquiring it. Additionally, it is the only NFT on the Polygon Network that I own
@KooksNft is a smaller project right now, but I was able to meet the founder during a Twitter Spaces event that I hosted and he growth of the NFT space means Kooks could serve a valuable position as helping educate people on surf etiquette and respecting the ocean.
5. Full Send Metacard
The Nelk Boys prank videos have been going viral across social media for years. Kyle’s candidness and ability to go off-script is a skill that few creators have.
Boasting 7.27M subscribers on YouTube, watching the Nelk Boys brand grow, improve the quality of the content, form partnerships with the UFC, and finally launch an NFT has been truly incredible. After bringing UFC owner Dana White onto the podcast, Dana is now a Metacard holder which is honestly so sick.
I’ve been following these guys on Instagram and YouTube but once I heard about their NFT launching, I knew that I had to jump on board.
Since I was not on the white list, my initial plan was to purchase one on secondary between the time of whitelist and the time of public sale.
I needed to think strategically.
With over 200,000 Discord members, the project was bound to sell out immediately and so the chances were almost zero that I would be able to get a Metacard during public sale.
During the Metacard minting event, with so much hype and website traffic, OpenSea CRASHED which made it impossible to purchase on secondary there.
At this point, the only way to get a Metacard was to venture into the web3 alternative exchanges – basically the real wild wild west of the internet, where you really have to watch out to protect yourself from getting scammed or having your assets stolen.
The risk of doing this is that you could easily end up buying a fraudulent NFT if you don’t verify that the smart contract and addresses are legit. After digging into Etherscan block explorers, downloading CSV files, and matching addresses, I made sure that I wasn’t about to pay for something fake.
I found a legit Metacard on secondary BEFORE the public sale started and successfully paid for and transferred it to my wallet.
With Full Send gyms on the horizon and new hilarious videos dropping every week, I couldn’t be more stoked for the future of Metacard community.
If you haven’t seen @KyleForgeard and the Nelk Boys’ YouTube videos, look them up immediately. Pranks and comedy is valuable for everyone, because we all need to laugh.
I’m still diamond-handing all of these to the moon.
Did I spend too much money on NFTs, or is this simply a healthy diversification of funds into a risky yet potentially exponential asset class?
You can analyze my spending history table below for yourself.
I’d also be curious to hear how you think NFTs will play a role in peoples’ lives over the next 3-5 years. Share a comment at the bottom and let me know what you thought.
In order to play the game on StarkNet, you need a Argent X wallet. Fortunately, Argent X is pretty easy to setup as a browser extension. 
Since the game is new and currently in Alpha development, I used the Goerli test net to try the game for the sake of experimentation, because it does not feature live transaction data.
I did notice that transactions unfortunately take quite a long time to process.
While the game is interesting and it’s exciting to see new developments on Ethereum Layer-2 scaling solutions like StarkNet, I’m not sure that featuring this particular game on a blockchain is worthwhile.
Since evolution data doesn’t need to be stored and the game is really just for entertainment and viewing the progress of the simulation overtime, users who are curious about the Game of Life are better off trying it in the web2 versions I’ve shared above.
Podcasts are one of the easiest ways you can learn more about crypto, NFTs, and blockchain because you can listen passively while doing something else.
Here are the best crypto podcasts that you will find:
The Daily Gwei
Anthony Sassano’s consistency in publishing this podcast about the Ethereum Ecosystem is unmatched – I don’t believe there’s another show that happens as regularly as the Daily Gwei. With episodes coming out at least every weekday, I’m thankful to be able to rely on this podcast for my daily dose of alpha. Additionally, Anthony Sassano does an excellent job of articulating the value proposition for Ethereum in a way that non-technical users can understand.
Where to start: start with the most recently published episode. This show is another daily-update style show, covering what’s happened in the last day in the Ethereum ecosystem.
David Hoffman and Ryan Sean Adams cover everything crypto, with a focus on the Ethereum ecosystem. The “Bankless” movement suggests the narrative that humans should have custody over their private keys, without 3rd party centralized intermediaries. The show also has YouTube videos for people who enjoy that format more.
Where to start: There are so many incredible episodes that you could honestly just pick one and dig in. Having hosted Vitalik on the show on multiple occasions, you could always start there. I also highly recommend the episode with Coinbase CEO Brian Armstrong. Lastly the “Ultra Scalable Ethereum – Modular vs. Monolithic Blockchains” episode was particularly enlightening. This is one episode you absolute must hear if you care about the future of blockchain scalability.
Internet legend Kevin Rose focuses on crypto and how it relates to the future of finance broadly.
Where to start: The episode with the Bankless guys was top-notch. Unfortunately the episodes are not published too regularly on the show, but when something is published, it is worth a listen. I’m looking forward to going back and listening to the episode with the Brave Software CEO, Brendan Eich, as well as the episode with Gary Vaynerchuk.
Into the Ether
Eric Conner and Anthony Sassano cover updates from Ethereum overall.
Where to start: given that the episode covers current events and timely updates, I would just listen to the most recent episode!
The Defiant – Defi Podcast
Camila Russo brings builders and users within blockchain technology and DeFi onto the podcast and does a really good job of asking the tough questions.
Where to start: the episode with Vitalik Buterin was particularly interesting, Camila did a great job of asking devil’s advocate style questions and we get to see how Vitalik responds.
Matthew Leising does a great job of bringing Ethereum experts onto the show and digging into not only the projects they’re working on, but also a contextual background of their lives and how they got started.
Where to start: The conversation with Meltdem Demirrors was the first episode I heard, and it was really interesting hearing about her background in bitcoin, and her story about testifying in front of congress.
Up Only: Chats with Crypto Experts
Cobie and Ledger host a show every so often where they get together and ramble on all things crypto. Both Cobie and Ledger do a great job of keeping the conversation candid and unscripted, and don’t hold back. It would be great if podcast episodes were released episodes more often, but regardless, the content is always solid.
Where to start: Anytime the founder of Ethereum appears on a podcast to share his ideas, its worth a listen. In addition to having a wide-ranging discussion about the internet and future of crypto developments, Vitalik shares his thoughts on anti-aging and life extension.
Kevin Rose focuses specifically on NFTs and artwork on the blockchain, bringing artists, collectors, and curators on the show to talk about all things non-fungible.
Where to start: I enjoyed the Particle Collection episode and hearing about the Banksy painting being fractionalized and sold as 10,000 individual pieces. Despite my best efforts, I was not able to get access to mint a Banksy Particle. Still a great show, though.
While it’s difficult not to roll your eyes the idea of a million $$$ dollar jpeg, there is a special shift happening that will fundamentally change the way that humans behave on the internet.
Crypto vs. NFTs as investments – some context:
At their best, cryptocurrencies like Ethereum have gained notoriety and traction as development platforms for blockchain applications (aka dapps).
At their worst, the ICO mania has seen many cryptos pump to extremely high valuations, to later crash back to pennies after early investors dump their holdings (aka pump and dump schemes).
NFTs, on the other hand, haven’t been around as long as Bitcoin or Ethereum. Even an NFT from as recent as 2018 is considered historical and hence more OG by groups of self-proclaimed “NFT Archaeologists”. Still, we haven’t yet seen a true bear market in the space just yet, and only time will tell if these hypothesis will remain plausible.
Regardless, the steady value accretion among communities like CryptoPunks and the Bored Ape Yacht Club provides evidence that NFTs are in fact more than just overpriced .pngs.
Wherever a person chooses to invest, one thing is for sure: NFTs and crypto are risky, and you can lose the money you put in.
Whether you should allocate more of your investments towards crypto or NFTs is dependent upon your own situation and investment goals.
That being said: NFTs and crypto have both had huge price swings in recent months. So, which might be a better investment – crypto or NFTs?
Why might a cryptocurrency like Ethereum be a better long term investment than an NFT?
As cool as NFTs are, there is a high chance they will not outperform a cryptocurrency such as ETH.
Most NFTs are built and hosted on top of the cryptocurrency protocols within the Ethereum ecosystem. Although there are NFTs built on other chains like Solana or Tezos, the largest market share by far sits on Ethereum.
Because that Ethereum powers the majority of the NFT market as a development platform and smart contract programming language (Solidity), owning ETH could feel safer than owning any one individual NFT.
After all, platforms tend to be accrue more value than the sum of all the individual items they support.
Developers are actually building new products and applications on top of the Ethereum Virtual Machine, which inherit the security and decentralization protocols of Ethereum itself.
Another property that makes Ethereum unique is that the asset is burned during each transaction, via gas fees. This reduces supply making ETH progressively more scarce as a result. This decrease in supply is one of the key tenets surrounding the ultrasound money movement.
Ethereum also has a strong development community.
The most significant upcoming item on the dev roadmap is the Merge, in which the Ethereum consensus mechanism will transition from proof-of-work to proof-of-stake. This means that new blocks are validated by nodes that have staked their ETH, instead of by doing energy-intensive computations.
Once Ethereum transitions to proof of stake, owners will be able to earn interest on their staked ETH, which could further drive the charts up and to the right.
The downside of purchasing NFTs
Given the large amount of questionable NFT projects he risk / reward ratio may not be there for NFTs. Extremely high fees mean your ETH stack is dwindling every time you make a purchase.
NFT markets are unpredictable, yet there are few sound and known fundamentals that back them up as an investment. They’re largely focused around hype, which whales are involved etc.
There is a lot that goes into deciding how to invest and which project to put your eggs into, finding high-ROI investments is an art as well as a science.
An investment portfolio is like a bar of soap. The more you handle it, the smaller it gets.
Does it make sense to own NFTs as a part of your crypto portfolio?
In my view, NFTs should not be held as investments, but for FUN and for the community.
Although NFT value increases can be quite unpredictable, a strong community is a good sign.
If you choose to hold an NFT, take your time, do your research, and find an NFT project with real world utility.
NFTs give you the opportunity to become part of a group that is focused around any specific thing.
One sign of legitimate community within an NFT project is the willingness for the founder as well as active holders to be doxxed and in the public eye, as well as seeking to build community for the long haul.
One thing that I always look for is whether or not there are in-person events or meetups happening within the community and among members from different regions around the globe.
That being said, being a member of an NFT community can be valuable because it is just fun.
Its like joining a fraternity or sorority in college, playing competitive club soccer, or joining the varsity wrestling team.
NFTs create groups of like minded individuals with stake in the focus area.
Diminishing returns: Once you purchase a few NFTs and join a few different communities, any future NFT purchases may only slightly (if at all) increase the amount of value you get from being part of the community.
Because of this, owning more than 1 NFT isn’t necessarily valuable unless you plan to flip it for profit.
Spreading yourself too thin: Being in a community means investing time and energy hanging out in discords, going on trips / attending events, and building relationships in that community.
A single person can only spend so much time. I feel that it is more impactful to be a dedicated member of a small number of communities rather than loosely tied to many different ones.
Sure, the NFT markets are fun to watch. Perhaps they’re worth keeping an eye on in case something truly special comes around that you’re dying to be a part of.
When I get the drive and conviction to own a specific NFT, I do so while making sure to maintain as much ETH ownership as possible.
Number going up is simply a by-product of being part of the group.
Most of us aren’t building the future of the internet – that’s the job of software engineers and designers. But we are the ones that will be more affected by crypto and NFTs potential use cases – we are the ones who will actually use it.
From the content we consume, to how we communicate… from how we spend money, to the career paths we choose… if blockchain technology and its applications continue to advance, the world and our relationship with the internet will be extremely different in the years to come.
Regardless if you’re allocating more capital towards NFTs, crypto, or neither, when we take a step back and look at the larger impact of this technology on our society, we should feel lucky to be around during such an exciting time.
Most people don’t understand blockchain, let alone Ethereum.
What is Blockchain?
Blockchain is basically a database that everyone shares.
Anyone can write to the database.
Blockchain enables users to attain self sovereignty over their money and wealth. To do so, all you need is a non-custodial crypto wallet.
What is Ethereum?
Ethereum is a decentralized world computer.
Ethereum possesses all the key tenets of decentralization, security, and cryptography, which are fundamental to blockchain.
Beyond that, Ethereum is fully programmable, where any application can be built.
The investment case for Ethereum (and hence ETH) is that it will become the most liquid token in a digital economy built atop of a Turing-complete decentralized computer that can execute smart contracts.
How do most people view Ethereum, and what are they missing?
Ethereum means many things to different people.
To some, it is a cryptocurrency… a token and you can buy and sell and speculate on, just like any stock or asset.
To other people, Ethereum is the entry point into the world of DeFi, and the slightly shady world of lending, borrowing and yield farming.
Some people use Ethereum buy into web3 projects like NFT’s or other crypto tokens.
To others, Ethereum is like a cousin of Bitcoin with high-transaction fees.
All of these various “identities” that Ethereum might take on express the magic of the Ethereum Virtual Machine.
When you combine all these applications of Ethereum, you start to see the big picture:
Ethereum is more than a cryptocurrency – it is programmable money.
Of course, the first use case of blockchain was the Bitcoin cryptocurrency, and it is extremely valuable because it solves the double spend problem.
But the principles of blockchain that enable currency can be applied in many other unique and creative ways. This is what Ethereum focuses on.
Solving the double spend problem is just the first of many.
However, in order to apply blockchain tech to problems in the world and on the internet, we needed a way to build apps and systems that has blockchain technology built in.
We needed a blockchain software development platform.
This is why Ethereum was invented.
Ethereum is a Platform Where Any Application Can Be Built
Ethereum is first and foremost a computer built on the technical fundamentals of blockchain.
Remember computers in the 90s and 2000s and even the ones we have now aka smartphones?
Well, the Ethereum computer is like that but its built on a new architecture using blockchain.
The technical fundamentals of Ethereum are sound. Its a distributed computer, meaning it runs on a network of linked nodes instead of a single motherboard and processor.
And blockchains fundamentals of decentralization, cryptography, and security have been built in… so its different from other computers because of this.
Given that Ethereum is a computer, this means that Ethereum can serve as a platform that allows applications to flourish. Ethereum it provides the tools for this.
Solidity is the Programming Language for Ethereum
By tools, I’m talking programming languages, developer documentation, Github repositories, communities, etc.
Ethereum actually has a programming language called “Solidity” that allows any developers to write code and build an application using the Ethereum blockchain as a platform.
Doing so allows developers to build the front-end that users interact with, while maintaining the solid technical fundamentals like decentralization that Ethereum promises.
Since 2017 when I first learned about Ethereum, this is by and large the biggest reason that I believe in its future.
I wanted to invest in a technically sound project that was seeking to re-engineer the internet and the way computing can be architected.
A technically sound blockchain platform would ensure that software engineers and developers would be driven to use it.
And in technology, if developers use it, then the business people will follow.
As Polynya describes on the linked Medium article, in order to ensure decentralization, it is important for a significant number of average users to be able to run a validator node.
A validator node is a someone with a computer within a peer-to-peer network that ensures consensus and validates transactions on the blockchain network. This prevents falsification and fraudulent activity, ensuring the blockchain remains trustworthy and tamper-proof.
To increase decentralization, blockchains must not create barriers or restrict / limit anyone’s ability to serve the community as a validator node.
Blockchains also need a way to incentivize users to become validator nodes. Today, ethereum does this by something called “proof of stake”, where validator nodes earn interest for their work.
And while validator nodes on ethereum technically require 32 ETH, users can join a staking pool to participate with a small group.
How is a decentralized community of validator nodes structured?
To ensure that ethereum continues to have as many validator nodes as possible, it needs to be easy for people to serve as nodes.
Users with consumer laptops/hardware and novice technical acumen should be able to participate in the community as a validator.
Compare the two possible blockchain architectures below and how they might affect the average person’s ability to serve as a node:
Scenario A: Low computing power is required for validation. Someone with a regular laptop (the kind you can buy from best buy or costco or apple) is able to run a node on the network and act as a validator.
Scenario B: High computing power is required for validation. A network full of a high-performance servers, or million-dollar supercomputers acting as nodes.
The model described above in Scenario A is decentralized because there can be a LOT of validators and nodes ensuring that no bad actors try to take over.
In Scenario A, while maintaining decentralization, the tradeoff with having a culture of small validator nodes means the blockchain is unfortunately inefficient and less scalable than a centralized system can be.
Scenario B is way more centralized because there are fewer people that will be able to serve as a node on the network.
The small number of nodes in Scenario B could in theory work together to take advantage of some portion of users at any given time.
Although Scenario B will be highly scalable, lower cost, and will enable the network to run faster, having such a structure defeats the purpose because the whole reason blockchains are valuable in the first place is to enable decentralization.
Scenario B could be less-favorable for end users because you cannot trust the few large-scale validator nodes from acting out of self interest.
To maximize decentralization, as many people as possible should be able to serve as a validator node on the network.
With present technology, true decentralized systems are great for establishing trust and avoiding but not so great for scalability.
The good news is that Ethereum will release data sharding which will increase scalability, but the risk is that, by Polynya’s estimates, it may take until 2023.
This is the world we’re living in today with Ethereum.
As Polynya describes below, based on the current state of the internet, I’m not so sure whether or not users truly do care about decentralization.
“there’s plenty of evidence from the web2 world, where the most adopted services are the ones that are most convenient, despite their overwhelming problems with privacy.” Polynya on Medium
Polynya on Medium
Perhaps some people simply want to use the most convenient blockchain with the lowest fees.
However, this partially misses the point.
In traditional models, as in Apple’s app-store, users experience fees on the backend, where the centralized entity takes a percentage cut of all app-generated revenue.
This idea came from BelugaWilliams’ tweet below.
The advantage of decentralized cryptocurrencies, albeit stressed with high-gas fees, is that creators and developers can maintain ownership of whatever they create.
What does this mean for ethereum?
Given that some users inarguably do prefer networks with lower fees, one possible outcome is that ethereum is overtaken by another, more centralized blockchain.
Although this may feel unlikely, it would be naive to ignore it as a hypothetical future scenario.
Today, ethereum does feels like the dominant chain.
More projects are built on top of ethereum than anything else.
Ethereum has created a rapidly growing application ecosystem.
From NFTs to layer 2 blockchains to lending and borrowing apps, as of right now Ethereum has more developer usage and user adoption than any other blockchain.
NFT’s, for example, while largely containing hype infused projects, also contain projects building a genuine community for their members. Surf Punks NFT, for example, is a community centered around surfing, and is even throwing a few wave pool surfing events.
Decentralized apps like Sorare enable enable fantasy futbol, powered by ethereum. What’s amazing is that all fees, transactions, and blockchain jargon is abstracted behind the scenes, so that all people experience is a user friendly fantasy sports game with their friends.
Ethereum’s current state is not without risks. The fact that sharding will take until 2023 to implement means that scalability will continue to be a challenge, although layer 2 chains may help segway some of the demand off-chain.
Given Ethereum’s strength, an unknown and unforeseen up-and-coming chain is unlikely to takeover without anyone realizing.
Sure, it is technically possible, but probably unlikely as the network effects of ethereum are growing rapidly.
However, while the new dapp ecosystem is focused on Ethereum, perhaps someone in the world is working to build a true Ethereum killer that will arise from out of nowhere and take us all by surprise.
Between 2013 and 2021, Cryptocurrency has followed the Hype Cycle exactly as expected. Let me explain.
What is the Hype Cycle?
The Hype Cycle, coined by Gartner, is a law that describes how humans accept new and emerging technologies and adopt them into our everyday lives
Its a generalized way of estimating and predicting the rise and fall of a new technology and the way people react to it.
The curve above is a graph of TIME on the x-axis, and EXPECTATIONS on the y-axis.
In cryptocurrency, expectations is quantified by looking at the price or market cap of cryptocurrencies. For years, the price of cryptocurrency was not interesting. Price was flat.
Hype Cycle Phase: Technology Trigger Pre-R&D
Crypto wasn’t being discussed all over Twitter. It was a nerdy, boring conversation.
Cryptocurrencies like bitcoin were only being used by a few small groups of people, and was nowhere near mainstream discussion or adoption.
Just look at the market cap of Bitcoin between 2013 and 2017 below. Relative to where it is now, this is extremely insignificant
Bitcoin’s price and adoption wasn’t even relevant at this point. Compared to the Hype Cycle phases in Figure 1, cryptocurrency wouldn’t have even been on the charts.
But while the public vernacular and mainstream media ignored cryptocurrency, engineers and enthusiasts were quietly building. On the Figure 1 Hype Curve, at this point crypto is leading up to the R&D phase; it still early.
This is why venture capitalists like Marc Andreessen are famously interested in “what the nerds do at night“. By recognizing emerging tech trends before everyone else, you have the opportunity to invest in them at a favorable discount… when the technology principles have been proven, but the applications have not quite been built, they are not user friendly yet, and the mass majority of people aren’t even aware of the technology.
Vitalik Buterin was funded by Peter Thiel in 2015 to found Ethereum. As the potential applications of Ethereum started coming into light, a buzz started happening within tech circles.
Hype Cycle Phase: Early Adopters Investigate
People started to understand the power of this thing called blockchain, and could envision the possible smart contracts and more.
While Bitcoin was built to serve as digital gold, Ethereum was built as a platform from which blockchain applications would grow.
Coinbase.com became the de-facto place to purchase Bitcoin and Ethereum. It was easy to use and wasn’t that different from purchasing stocks at a place like Fidelity or Charles Schwab.
Working a desk job at a cubicle during this time, it felt like colleagues in the office were all starting to think about crypto and were considering buying it on Coinbase.
A few viral memes and Twitter conversations happened and before you know it, the prices of Bitcoin and Ethereum, the two big flagship cryptocurrencies, were pushing all time highs almost every day.
I hate to include a disclaimer here, but as you can tell, I’m going to be generalizing a lot in this post about the crypto community. I mean no disrespect. I love blockchain technology and the projects it has enabled… I want nothing more than what’s best for crypto as a whole. As an owner of bitcoin, ethereum, and other coins, I’ve seen the emotions of early adopters around me have experienced when the prices rise extremely fast (and inevitably fall just as quickly).
Hype Cycle Phase: Inflated Expectations
Towards the end of 2016 and into 2017, everyone started buying crypto. If you took a 10 minute uber ride across town, you would almost undoubtedly hear your driver mention something about the price of bitcoin.
Crypto millionaires were created. A friend of mine even managed to pay off his student loans from selling his stake in Ethereum, which he had acquired just months earlier.
At some point, it felt like people didn’t necessarily care about the applications of blockchain technology. Your average person was interested in trading, buying and selling, getting rich quick and only focused on the price rather than the underlying technology.
At the peak of inflated expectations, a few things can happen:
Engineering and developer teams tend to over-build. More crypto’s launched between the end of 2016 and early 2017 than anyone could keep track of. But the projects being built were not being used by anyone. The projects had no customers…
What the projects DID have, however, were investors. There was an abundance of over-eager individuals looking to throw $100 bucks into any coin with a slim chance of making it in hopes of returning 1000X on their investment.
The problem with this is that there are more people in the crypto community who are focused on making money from the technology than there are users and customers who are actually using the technology for the value it brings into their lives.
As more cryptos were launched than there were users or customers, the over-inflated expectations started to become apparent.
The thing is, no one knows just how HIGH the peak of inflated expectations might go.
In order to capitalize on investments in crypto, the smart ones on Twitter and Reddit communities preached the importance of holding onto the investments, not selling, and riding out the wave.
The thing is, this is a tricky thing to do. It is easy to decide to sell at the top, and even easier to decide to call it quits as an investment tanks and you lost 80-90% of your the value of your portfolio.
In some cases, those that sell at the top end up exiting while they’re ahead. In other cases, people with intentions to sell at the top end up waiting too long, and end up making an emotionally drastic decision to exit their crypto position at the worst possible time, during the trough of disillusionment.
Because the trough can last for years. In the case of Bitcoin and Ethereum, it lasted from the beginning of 2018 through late 2020.
The thing about cryptocurrency and blockchain technology (at least so far) is that the rise and fall of price of different cryptocurrencies are heavily correlated with each other.
As bitcoin rises, ethereum usually is rising also. As bitcoin enters the trough of disillusionment, ethereum was too. The same can be said for the other crypto’s that made it through the trough.
Bitcoin didn’t really start to enter the next phase until the coronavirus pandemic was in full swing mid to late 2020.
Hype Cycle Phase: Enlightenment to Productivity
Between late 2020 and today, the market cap of all cryptocurrencies has continued to push all time highs.
The reason for this may partly have been accelerated by the pandemic, but there’s more to it than that.
Within the crypto community, there is a large amount of funds going into projects that are receiving mainstream adoption.
NFTs (non-fungible tokens) are one example of an application that is seeing close to mass adoption.
Although it is still a fringe hobby, NFT collectibles have some resemblance to the enthusiasm around collectible sports cards and even Pokemon cards.
People are creating NFT masterpieces using artificial intelligence and listing them for sale as unique, one-of-a-kind tokens on websites like OpenSea.
This is just one example. There are a number of other projects being built on top of Ethereum and discussed but we for many of these applications, it seems we still have a long way to go before mainstream adoption.
So as we’re pushing all time highs in almost every cryptocurrency, my question for the world is: are we entering another peak of inflated expectations? Or is this time for real? Are we truly in the Plateau of Productivity?
And this brings up a few follow up ideas and questions about the future… because at the end of the day, we can’t truly predict the future, we can only form hypothesis based on historic trends, proven laws, and observable principles.
Final Thoughts and Additional Questions
Could a technology go through the various phases of the Hype Cycle more than once?
Will cryptocurrency enter another trough of disillusionment?
How might other technologies follow the hype cycle?
Are there examples of technologies that do NOT follow the hype cycle?
As a technology follows the hype cycle, will the peak of inflated expectations ever over-extend the value of the technology as it reached the Plateau of Productivity?
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