The blockchain – and crypto in general – is infrastructure and infrastructure is a means to an end. Infrastructure should be "boring"; when I say boring, I mean it doesn't provide aggregate value by itself. The blockchain's intrinsic value is the rails by which wealth can be transferred and the underlying contracts. It's a way to optimize the movement of assets and automate the exchange of value.
What you build with it, though, can add a lot of compounded value to users in the form of end-user applications or further layers and abstractions to the blockchain for other developers to build value on top. Roads are useless without cars.
So far, I've seen very few practical, mainstream, valuable applications of blockchain technology. I'm not interested in exchanges, NFTs, custom tokens, or anything of the like. I'm interested in the first wave of companies that will use the blockchain under the hood, with mainstream user bases, and not a single mention of crypto or the blockchain in their marketing.
I'm interested in financial disintermediation and decentralization, fast movement of funds, and automated distribution of funds based on contracts. Real asset interest distributions, royalties, intellectual property, dividend distributions; the list is endless.
I'm still waiting, and I got time. Unfortunately, most applications out there on the blockchain today are largely useless or, at worst, grifts. We've gone through a few fads in the last 5 years; we started with ICOs and an explosion of tokens, which is the real-life equivalent of creating Schrute-bucks, and we ended with NFTs.
I just got my first NFT – I think it's an NFT? – through Reddit and supposedly I can use it to display it on my profile and maybe sell it afterward, for which they'll get 5% of the proceeds. It's a baseball card? Except worse because it has no physical representation? Maybe it's short-sighted of me to think of the lack of physicality as a limitation, but truth is, mainstream users outside the tech bubble are certainly not going to care about a stamp they can't admire in person.
A problem with incentives
The underlying technology behind the blockchain, and its multiple variations, with or without smart contracts, is actually not that complicated. I do feel, though, like the investment world has hyped it to be something it isn't, and that has created misguided structures of incentives. Everyone else has followed suit.
To this day, no one has proven the long-term, mainstream value of crypto. The closest attempt has been Coinbase, and their stock is down 80% since IPO. I'm sure a lot of people have gotten, and will get, rich by speculating in the private markets and dumping before reality hits, but we haven't seen long-term sustainable projects. This doesn't mean they don't or won't exist; I'll keep my eyes peeled because I'm a big believer in the power of a technology like the blockchain, especially smart contracts. It's possible these projects already exist and they're buried in a sea of hype and big funding rounds.
If you're working on an amazing crypto project that you believe adds long-term value to society, hit me up.