Nov 14, 2021 • 10M

Ep 37. Crypto: It's 1998!

Crypto adoption. Web 3.0. Diversity.

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Some say Crypto is a scam. Others swear it's a breakthrough technology. But which is it? Join us, as we explore Crypto in real life (IRL).
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Hey friends!

I want to invite you on a trip down memory lane. Can you guess which year these events happened?

  • President Clinton is engulfed in a sex scandal

  • Titanic becomes the first movie to gross over $1B

  • The word’s largest company is born when Exxon acquires Mobil for $74Bn

It’s 1998. Gosh, I feel old :-)

Crypto continues to march ahead at a dizzying rate. I took a couple weeks off as I completed a Product Management certification while also working on a couple other things. Stay tuned, more updates to come.


Ruminations

1. Crypto in 2021 = Internet in 1998

  • My dad is a tech nerd. In the late 1990s, we lived in a small town in Nigeria. My dad would occasionally go on business trips abroad. He would ALWAYS excitedly return home with a new gadget to play with.

  • It must have been around 1998 when he plopped my sister and I down in front of his computer to create our first email accounts. I remember choosing my yahoo domain name. He said we could use our new email accounts to send messages to our friends. Trouble is, most of our friends wouldn’t get online for a couple more years :-) Dad was early but he was right. Thanks Dad!

  • Some fresh analysis suggests that crypto adoption today is where internet adoption was in 1998. That’s crazy early! 1998 is more than 5 years before Facebook was established. Uber and Airbnb came along 10 years later. With this in mind, it’s entirely possible that the killer applications of Web 3.0 / crypto have not even be created yet. That’s wild!

  • Let’s also remember that back in the late 1990s, many people thought the internet was a fad. Nobel-prize winning economist, Paul Krugman, famously said that by 2005, it would be abundantly clear that the internet’s impact on society would be no greater than the fax machine. Ouch! That did not age well.

2. Crypto crystal ball

  • I don’t know if anyone in 1998 accurately predicted how deeply the internet would transform our lives. Today, we find love online. We learn online. We shop online. We work online. It’s difficult to imagine our lives without the internet.

  • Web 1.0 was the first wave of the internet. The focus was connecting information. The killer application was search. Suddenly a teenage girl in rural Malawi was no longer limited to the 11 books in her school library. Now she could Google questions and gain insights gleaned from around the world.

  • Web 2.0 was the next wave. This connected people. Social media was the big kahuna. It started with MySpace then Facebook, Instagram, Snap and bunch of other platforms. Long lost family members reconnected decades after separation. Corporations built advertising fortunes off our digital footprints.

  • Web 3.0 is coming. It will connect information, people, places and devices. It will be decentralized as opposed to the current structure where data ownership is concentrated in large organizations. Users will no longer just be a commodity. Rather, users will be owners. It would also leverage advances in artificial intelligence and machine learning to offer a more intelligent internet experience. The metaverse will be part of Web 3.0. It’s a big enough deal that Facebook went ahead and renamed itself Meta.

  • Now, I am still wrapping my head around Web 3.0 and the metaverse. The best way to learn is by exploring. Dive in and tinker away. The metaverse is a virtual environment for play and work. It is enabled by a suite of technologies including virtual and augmented reality, blockchain, cryptocurrency, NFTs and more.

3. Young guys are leading the way

  • I love data. There is a ton of data out there but it’s of varying quality. One has to sieve through to separate the facts from the “alternate facts”. The Pew Research Center is a highly respected purveyor of good data.

  • A recent Pew study found that 16% of Americans (~51M people) have dabbled in crypto. Unsurprisingly, the proportion decreases with age. Older techies like my dad are few and far between. Interestingly, 43% of young American men (18-29 years old) have invested, traded or used crypto. However, only 19% of women of the same age have. That’s a huge gap.

  • I was surprised to see that racial minority groups (Asian, Hispanic, Black) are outpacing the majority in crypto exploration. However, this is not mirrored in the crypto labor force. Rare, do I see leaders in the industry who are from minority groups. These groups are often under-represented among the rank and file of leading crypto firms.

  • If crypto is going to be a building block for Web 3.0. Then it’s essential that a broad-section of society is involved in shaping that future. Ideally, the crypto labor force would mirror society. Crypto is a big tent. There is room for you, whoever you are.


    News

    1. Crypto Capital: New York vs Miami

    • Eric Adams, the newly elected Mayor of New York plans to take his first 3 paychecks in Bitcoin. He wants New York City to be the center of crypto

    • Mayor Saurez of Miami announced that residents would be eligible to receive bitcoin dividend from the city’s crypto project

    • I love this friendly rivalry between these two cities. A lil friendly competition helps drive the industry forward.

    2. Presidential advisors say stablecoins could drive efficiencies

    • President’s Working Group on Financial Markets released a report finding that stablecoins can drive significant efficiencies

    • However, they need more regulations to safeguard consumers. They recommend only FDIC insured institutions issue stablecoins.

    • I think this great. Regulation is a marker of growth. Clarity enables even more growth.

    3. Robinhood: Crypto results plummet

    • Robinhood’s crypto revenue fell 78% from Q2 ($233M) to Q3 ($51M) as the number of monthly active users (MAU) slipped from 21.3M to 18.6M.

    • Q2 was exceptional due to dogecoin hysteria and broader crypto bull run. Would love to understand how this performance compares to the likes of Coinbase and Square’s CashApp.

    • All is not lost, Robinhood’s Crypto COO recently shared that they have 1.5M people on their waitlist to use their new crypto wallets.


That’s all folks! Thanks for sticking with me. As always, I’d love to hear your thoughts. Have a great week!