In fact, most blockchains are businesses. Some people don't like to hear that, but that's the truth.
Last week, we published an article on this topic, which was met with some blowback from the community. In particular, Chris Burniske of Placeholder VC wrote in a blog post :
I respect Flipside and the work that he is doing on Basic Crypto Asset Scoring (FCAS), but I am concerned that the idea of encouraging the agreement to see itself as a business entirely will first thwart the agreement's promise.
The agreement provides the structure for the business, but not the business itself. They are a logical system for coordinated exchanges between service providers (enterprises) and consumers. As the coordinator of the transaction, the agreement should be the minimum profit, but the company is motivated to maximize the profit (that is, profit, the value of an enterprise is a multiple of its profit).
To further clarify this topic, we will introduce the 0.1%, 0.9%, and 99% rules of the blockchain.
0.1% -0.9% -99% blockchain rules
The following is the thinking about the structure method of the blockchain field: 0.1% of the blockchain adheres to the concepts of complete openness, freedom, complete peer-to-peer, and decentralization identified in the Satoshi Nakamoto white paper . Bitcoin is committed to doing this.
The 0.9% blockchain is directly focused on trying to implement this framework, funding development through experiments such as inflation funds ( Decred , Zcash ), volunteer funds ( 👹Moloch , Grin ), and community-recognized dilution.
99% of projects follow the traditional philosophy: operate like a business. They have employees, they have some form of funding, they have developed some technology, and they have adhered to some concepts about blockchain commitments (such as immutability), but the rest have changed.
This 99% needs revenue to fund operations. They have employees who need to be paid to work. This means that they need customers who use the agreement and generate revenue. If there are no customers, no revenue, and no sustainable business model, then there will be no employees.
Adapting traditional growth indicators to the new encryption model
Since the vast majority of 99% own tokens , they need to consider growth, whether it is the smallest or the largest profit . Growth means operating like a business.
The protocol not only needs to track the speed or volume of transactions over a 24-hour period, but also to see what users are doing over time. Only by doing so can we truly start trying to enter the customer channel cycle and meaningfully drive growth. "If we establish an agreement, customers will come" mentality is wrong, trading speculation is unsustainable, and the addition of new terms such as "agreement" will not eliminate the need to develop core business indicators. To operate like a business, they will need:
- Know that their users are at different levels (protocol level, network level, application level, consumer level)
- Segment those users (developers, operators, customers, consumers)
- Track the growth of each community (coverage, activity, engagement loss, life cycle),
- Track user behavior (transaction volume and frequency over time),
- Track cumulative asset flows (expenses, savings, transactions) across the network,
- Track overall asset growth (price and economy)
Many in 99% of companies will fail (as most start-ups fail), because most companies do not have the perseverance to develop sustainable business models, but many companies will thrive and become large enterprises.
Venture capital in the agreement
Many venture capitalists invest in agreements. From the perspective of how VC works, this usually means that the agreement is the company. Without business, venture capitalists would not invest.
Venture capitalists investing in the agreement will make a simple consideration: how can they ensure that their investment will generate a return?
Since many of the 99% blockchain projects will not get enough attention, venture capitalists will do their job: they will do everything in their power to help them find a way to do so without the constraints of 0.1% The next transition to income-generating activities. 99% of the projects will charge for the activities, … generating revenue from customers … so that they (and their VCs) can realize the value of the company.
0.1%, 0.9%, and 99% of the value will all play a role in the blockchain ecosystem-of which 99% of the value is most likely to break through and be adopted on a large scale. BTC (0.1%) has done it, but few other companies have this viability without transforming into a mature company.
Smart cryptocurrency organizations have begun to operate like traditional businesses. As the cryptocurrency market matures, the requirements for understanding customers, revenue drivers, and success metrics increase.
Blockchain: building a business model or going bankrupt.
Original link: https://etherscan.io/address/0x38b97bf431a02d71428360231c2e9d4257f75d4f#tokentxns
Original author: Flipside Crypto compile: true Satoshi translation group -SHOU