Giving Thanks for Idea Sex š
EDITION NĀ°14 | 25 November 2021
Today is a significant day in another event-packed week. Today we give thanks to all our readers - thank you for continuing to follow DeFi Insights! š
Today we also wanted to give thanks for the Idea Sex [aka Collaborative Masterminding]. Without it, we wouldnāt be typing this article to you about DeFi, NFTs and the Metaverse. So, yes, another solid semana. From burgeoning ecosystem pirouettes to VC prowess and Bitcoinās Square promise, itās been a big 7 daysā¦ Letās do this š¦
1. Sexy-Time [for ideas]
Ever read Packy McCormick? If not, weād recommend stopping by his Substack for a bit of enlightenment/alpha. Earlier this week, Packy outlined the concept of āIdea Legosā, drawing parallels to a16zās Chris Dixonās observations on composability:
In a seemingly emerging mental model, Packy observes that innovation spawns a whole ecosystem of ideas that can be progressively stacked upon each other to pivot the paradigm. This principle dominates in Web3 as smart-contract composability defines opportunity; the foundations are laid with the blockchain, itās just a case of building out the rest of the protocol citadel, forking and iterating portions of code to pull together the new āAsset-Lego-Frankensteinā.
This thought leadership reminded us of another prominent thinker, Anne-Laure Le Cunff who discusses ācombinational creativityā in her recent piece on āIdea Sexā š, a concept that was initially born in 2010:
āCombine two or more ideas ā¦ to see what interesting new idea may come out of the experiment.ā
Also:
So when ideas have sex in the crypto world.. It was lending $ETH that evolved into DeFi 1.0, graduated to DeFi 2.0 and is now paving the way for 3.0. Either way, hackathons seem to be a great way to achieve this and DAO structures assist in coordinating and delegating capital for project communities. On that note, read Kelsie Nabbenās piece on the evolution of DAOs as crypto-cities & states and how these stand to compete with corporations in the Metaverse. In addition, have a glance at Goldberg, Kugler and SchƤrās paper on valuing virtual land in Decentraland.
2. All things bright and VC-funded
We spoke last week about the tsunami of investment šš° thatās been flooding the digital asset ecosystem over the past year(s). VC spend continues to drive northwards and as Deribit point out in their article, this makes for an optimistic outlook for āour industryā in the coming years. On that note, congratulations to Celsius who expanded their Series B ecosystem raise to $750 million from $400 million [now at a $3.25 billion valuation]. And of course, Moonpay, who successfully raised $555m at the end of last week.
The question remains, are we now firmly planted in a supercycle or suspended in a somewhat overblown bubble?
Time will tell, but from Coinsharesā fund flows report on Monday, even a choppy week in the markets hasnāt assuaged investorsā thirst for digital assets. Even Fidelity, UBS, and State Street are scoping out the crypto fund space with a view to launching their own products. The degens will tell you to watch out for corporates using cryptonative memes/phrases; the bell will be ding-a-ling-a-linging when TradCorps launch Ā« WAGMI (š¦,š¦) š¦§ IYKYK Ā» campaigns.
Oh wait..
Except this is by no means a bad thing. This is how niche goes mainstream; along with celebrity adoption, corporate adoption is key. S l o w l y a t f i r s t then allatonce.
3. āæitcoin
Yes, there has been some price volatility of late, but Bitcoin isnāt going away any time soon, especially as Squareās new TBD division unveiled their white paper for a decentralized exchange using bitcoin, fiat and other real-world goods.
āThe tbDEX protocol facilitates decentralized networks of exchange between assets by providing a framework for establishing social trust, utilizing decentralized identity (DID) and verifiable credentials (VCs) to establish the provenance of identity in the real world.ā
This is a major undertaking and the impact could be significant; building out smart-contract functionality for BTC, unlocking the potential for IRL good tokenization that could outrun the efforts of Centrifuge et al. Dorsey is the CEO for Square & Twitter - who recently enabled Bitcoin tipping on their platform - so it isnāt difficult to imagine the roadmap. Either way, it would be a scary trade to short Bitcoin, especially as El Salvador signalled its intentions to build a/the Bitcoin Cityā¦ at the base of a volcano. š
It sure is an interesting time to be alive.
And now, time for CZ on Bloomberg.
If youāre not already familiar with CZ, the CEO of Binance, then you will be soon. His most recent PvP with Elon Musk on Twitter was interesting although just tame enough not to be alarming [CZ 1, Musk 0]. Binance have been very much in the press recently and Bloomberg did a great job bringing him in to talk technology innovation on this program. Enjoy!
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