Coinbase CEO If I start a business in 2023, I have ten cryptocurrency ideas.

Coinbase CEO has ten cryptocurrency ideas for a business in 2023.

Author: Brian Armstrong, Founder and CEO of Coinbase; Translator: LianGuai0xJS

Sometimes people ask me, if you were to start another cryptocurrency company today, what kind of company would you start? The crypto space is still in its early stages. Five years from now, many entrepreneurs will look back and wish they had started a cryptocurrency company in 2023. The bear market is the time to build, so why not start today?

I have decided to share my top ten ideas in the hopes that someone will take them and turn them into reality. Ideas are cheap, it’s the hard work and determination to execute that is challenging. Coinbase has resources to do a lot of building in the crypto space, but we don’t have time to build everything and want to help the ecosystem around us. We have already invested and partnered with some great teams who are executing on these ideas. Others are still unexplored. We need more people to join us.

Coinbase Ventures will be hosting a hackathon in October, and we hope to invite a small group of top founders or projects working in or around these idea spaces to come together and collaborate.

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Now let me introduce my top ten ideas in no particular order.

*Note: Coinbase Ventures has already invested and will continue to invest in many startups in these areas. Below are some examples (not all).

Flatcoin

Bitcoin is the gold standard of the internet, which is a great idea for money. But it still has a lot of room to grow and many people aren’t comfortable using it as currency. It still needs some growth. A stablecoin backed by a legal guarantee is a good intermediate step, but they are subject to inflation and freezing, just like fiat currency.

What would a better form of currency look like created through cryptographic technology? It could be fully decentralized (resistant to censorship) and track consumer prices (like the US CPI) to maintain purchasing power, or come close to that goal. It may need to be backed by a basket of assets to track the CPI, or use algorithmic methods. For example, services like Truflation even provide a way to track inflation on-chain, further decentralizing it. Companies or protocols that help build better forms of currency in the crypto space will have a huge impact.

Reference projects: Ampleforth/Spot, Nuon, Truflation

Onchain Reputation

We now have decentralized identity verification using ENS, but how do we know who is trustworthy? How do we know if a merchant is reputable? Or if we are sending to the real artist?

We can create a decentralized protocol that assigns a reputation score to each address or ENS name based on an on-chain data graph. This is similar to how LianGuaigeRank ranks websites based on inbound links and associated metadata graphs. This can be used for lending (decentralized FICO scores), merchant ratings (Yelp), fraud prevention (wallets can warn me before sending to risky addresses), airdrops for VIPs, etc. It needs to be a decentralized protocol to prevent capture or abuse.

Onchain Ads

In Web 2, the best business model is advertising. It is reasonable to speculate that some form of advertising will be popular in Web 3. Developers and startups in Web 3 will be increasingly willing to pay for distribution, but can we surpass the traditional advertising model? In Web 2, the biggest innovation was the transition from CPM (cost per thousand impressions) to CPC (cost per click). In Web 3, perhaps we can transition completely to CLianGuai (cost per purchase or on-chain action).

Imagine that any smart contract can publicly disclose metadata about how much it is willing to pay to guide users to a function call. The function call can receive a referrer address and pay a certain commission. Indexing all smart contracts that support this advertising standard will create an ad inventory. Now, wallets and applications with a large user base can choose which ad or referral link to route requests to and share profits when delivering users. Real-time auction mechanisms will help find the optimal price. There may be other variations of advertising in Web 3, but the above is just an example.

Reference projects: Spindl, HypeLab

Onchain Capital Formation

The ICO frenzy has faced significant challenges, including fraud and unregistered securities. But for some reason, there was once a frenzy: global capital formation still has excessive friction. And the distribution is uneven. If you are an entrepreneur living in Budapest or Bangalore, your chances of accessing capital are lower than those living in Silicon Valley or Cleveland. If it were easier to raise funds, we would have more startups (not just startups: ordinary people raising funds for apartment buildings or anything else).

What might the next generation of ICOs look like, both legal and trustworthy? Imagine combining Stripe Atlas and AngelList in Web 3, not only helping you register your company or idea (in each country, by submitting documents, or as a DAO, pseudonymously), but also helping you raise funds for your idea. Each idea can have a pitch deck or video, discussions and ratings, participant reputations, and transparent on-chain fund flows. Democratized fundraising can unleash enormous potential for entrepreneurship globally.

Job/Task Marketplace for Crypto

Only a limited population globally has enough disposable income to invest in cryptocurrencies. However, almost everyone needs to make a living and spend income on basic needs. The main barrier to a more global and free labor market is the difficulty of cross-border payments to individuals. Why not create a more global and free labor market by allowing the posting of jobs and tasks that can be paid in cryptocurrency and helping employees and contractors find them?

Reference Projects: Braintrust, Earn.com

Privacy for Layer 2

Layer 2 solutions have started to help scale cryptocurrencies, which is great. However, most transactions still occur on the public chain. There are many cases where transparency is a feature, but people don’t want most economic transactions to be public. How can privacy be introduced in layer 2 solutions, and can a business be built here?

Reference Projects: Aztec, Polygon, zkSync

P2P Exchange Fully Onchain

P2P exchanges for cryptocurrencies provide important entry and exit points in emerging and underdeveloped markets. However, P2P exchanges are operated by centralized entities that can be pressured to shut down. Is there a way to build a fully onchain decentralized P2P exchange with custody, reputation, and arbitration functions?

Reference Projects: Onboard

Onchain Games

I’m not an expert in building games, but I feel like we’re just getting started with the intersection of cryptocurrencies and gaming. How can players truly own the items they collect and use in games? How can these items exist in a persistent world (or dare I say metaverse) to create more complex interactions and economies? Early examples like Dark Forest are exciting.

Perhaps more games can be built using Loot. These games don’t have to be large-scale bestsellers. Even simple games like A Dark Room can be adjusted to use NFT virtual items owned by players in a shared persistent virtual world with other players.

Reference Projects: Azra Games, Horizon Blockchain Games, Immutable, Plai Labs, Yuga Labs

Tokenizing Real World Assets

1:1 backed fiat currency stablecoins like USDC are the first validated, scalable, and onchain representations of “real world assets.” We believe that over time, many forms of assets can and will be represented on open, permissionless blockchain networks, creating new financial primitives with programmability, composability, global liquidity, and settlement with minimized trust.

Many projects today (including some in our portfolio) are exploring approaches in this area, involving debt instruments, treasury bonds, commodities, accounts receivable, and even high-end luxury goods.

Reference Projects: Goldfinch, Centrifuge, MoHash, Naos, Mountain Protocol

Software To Start and Manage Network States

“The Network State” (by Balaji Srinivasan) has accelerated the development of startup cities and network nations. More network nations will be created, and they will need tools for managing voting, governance, fundraising, citizenship rights, taxation, and service provision. With some thought, this software could be useful for many different types of startup cities and communities.

Apply to Attend the Coinbase Ventures Summit

Coinbase Ventures will be hosting a summit later this year, bringing together 20-30 top builders and aspiring builders in the crypto field. Whether you already have an ongoing crypto startup or just have an idea, we invite you to apply.

Attendees will be asked to give a brief presentation to the team, introducing their ongoing work or things they are interested in within the crypto field. These presentations will be followed by in-depth discussions centered around a few selected ideas. There will also be some social time and unexpected guests joining me.

Coinbase Ventures may potentially invest in some of the attending companies or form partnerships as a result of the summit.

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