Will the next bull market bring about cryptographic projects that surpass Bitcoin and Ethereum?

Will future bull markets bring new crypto projects that outperform Bitcoin and Ethereum?

The fascinating thing about the blockchain field is that there are always small projects that are initially overlooked, underestimated, and looked down upon, but suddenly become big and turn into a monster in a matter of months, spawning countless follow-up projects and forming an ecosystem for the field. That’s why there are countless people joining in. Moreover, Bitcoin, Uniswap, and Ordinals are not created by companies supported by huge venture capital investments. Any successful project goes through a process from an ugly duckling to a swan, and when it is born, it is very ugly and no one thinks it will become valuable. That’s what’s appealing about the crypto world. If a world is divided and formed by vested interests, it will be lifeless.

Airdrops have now become the most explosive way to activate users. I even have a judgment that the evolution of the coin release paradigm is the direction of the evolution of the blockchain, from the earliest hardware mining, then to 1C0, and then to DeFi liquidity mining. The next bull market may be airdrops. Of course, the airdrops in the next bull market will be different from those scattered airdrops in the past. There may be a standard version, and large blockchain networks will have their own standard versions. The main purpose, of course, is to resist the witches, and a reliable and usable DID is a necessary prerequisite for the standard airdrop mode of the next bull market.

In the past, blockchain networks did not build a DID system, such as Ethereum, where ENS domain names themselves cannot be used for decentralized identity transfer. However, a trend in the future is that large blockchain networks will build a DID system. I still emphasize that from the earliest hardware mining (which stimulated the skyrocketing of Bitcoin) to ICO (which stimulated the prosperity of Ethereum), to liquidity mining (which stimulated the rise of DEX), the token release paradigm of the next bull market will evolve into an airdrop paradigm, and the premise for forming this trend is the formation of a truly reliable large-scale DID system. In the future, new large-scale blockchain networks may design DID systems from the beginning, and even bind the consensus mechanism with DID, which may achieve perfection in the future.

My ideal unified domain name decentralized identity system, where all domain names with different suffixes and prefixes can transfer and communicate with each other, rather than just ENS domain names to ENS domain names, is very similar to uniswap creating trading pools, which ignited the first shot of decentralized finance. Non-financial applications will be the top stream of the next bull market, and decentralized identities and account abstractions are not isolated from each other, but are naturally integrated into one. All domain names with different suffixes and prefixes can become usernames for future Web3 social or gaming applications, and the future applications of domain names with different suffixes will be countless, not just one or a few. The domain name suffix does not necessarily represent a certain public chain. Even the bored monkeys of today can see this trend when they release domain names. In the future, a DAO will release domain names and a game platform will release domain names, which will be very common. In the future, it should be normal for ENS domain names to be transferred to bored monkey domain names. In a game, it is not surprising that people with ENS domain names and people with bored monkey domain names compete against each other.

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Even bored apes are starting to issue domain names, but unfortunately it did not pass the proposal. Bored apes are IP, but since the number of NFTs is too small, they are going to issue domain names in order to expand their user base infinitely. In addition, combining domain names with NFTs is a perfect match. I think there will be countless domain name suffixes in the future. The meaning represented by a certain domain name suffix may no longer be that of a certain chain, but that of a certain DAO or community. This is a change in the application paradigm of domain names, and it is the inevitable trend of natural evolution of the market, rather than being concentrated in one or a few domain name applications. UNIDID, which is bound to the soul (currently only bound to ENS domain names and NEW free domain names), will provide identity identification for all web3 usernames (which will be domain names with different suffixes) and PFP avatars for decentralized social and game users in the future. Domain name unification is a must-have and a necessity.

Currently, the most successful model in the currency circle, whether decentralized or centralized, is the platform-merchant-user model, such as Ethereum, smart chains (Bitcoin is not even among them), or exchanges such as Binance and Coinbase. These two types have a common feature, which is that there must be merchants on them, and then users. Decentralized applications on Ethereum are merchants, and various CEX exchanges are even more so. Those tokens are all operated by merchants. As a platform, whether on Ethereum or on Binance, they are the most powerful. They are similar to Taobao, where Taobao is a platform, there are merchants on the platform, and then there are users. Pinduoduo and Didi are the same. They all belong to the platform economy model. Only the charging models are different. Some do not charge merchants, while others have alternative charging models that are essentially charging. This is like Ethereum and Binance, which actually charge fees. Only this model can form a stable cash flow system. Others are following the trend, and even top-tier projects cannot form a stable cash flow, even going to zero during the bull-bear cycle.

The future valuation of the largest decentralized social network will basically have a market value similar to that of the number one cryptocurrency, and at some point it may even exceed the market value of the number one cryptocurrency, just like this year’s capital chasing AI. Because capital is a global, all-perspective view, it will not only focus on cryptocurrency, and capital always pursues the latest and strongest fields, not necessarily in the cryptocurrency field.

Decentralized social networking itself doesn’t necessarily have to do with cryptocurrency. It can be unrelated or related. In other words, decentralized social networking and cryptocurrency are actually two different things. There is a trend now of various cutting-edge fields “merging” with each other, and there may be a super giant explosion. For example, AI, decentralized social networking, nuclear power, brain-machine interfaces.

Blockingradigm, which was deeply incubated by Uniswap and became famous in one battle, has now undergone a paradigm shift. They are no longer only focused on cryptocurrency/Web3. Their official website has quietly changed the homepage to “Blockingradigm is a research-oriented technology investment company” and deleted expressions related to cryptocurrency/Web3 such as “We believe cryptocurrency will define the next few decades.”

It can be said that in the most promising fields, cross-border integration may produce new super giants in the future, whose future market value may be more than ten times that of the largest project market value we see today. AI and decentralized social networking are both likely to be valued more than today’s Apple and Bitcoin.

The estimated value of the largest decentralized social networking site in the future can basically be the same as the market value of the number one cryptocurrency, and even surpass the market value of the number one cryptocurrency in a certain period of time, just like capital chasing AI this year. Because capital is global and all-perspective, it will not just focus on cryptocurrency, and capital always chases the newest and strongest. It doesn’t necessarily have to be in the cryptocurrency field. If AI makes great progress, capital will turn to the strongest AI project. If a decentralized social networking site makes great progress (the sign is that the monthly active users are consistently over one million), capital from all over the world and all perspectives will shift to the decentralized social networking field. Therefore, the largest project in this field may not be smaller than the market value of Bitcoin.

In the bull market of 2017, ICo was matched with Bitcoin halving, and countless capital gathered in the blockchain field. In the bull market of 2021, DeFi was matched with Bitcoin halving, and a large amount of capital entered the blockchain field. So what about the next bull market? Under the concept of Bitcoin halving, on the one hand, Ethereum’s innovative technology will stimulate the increase of new users, such as account abstraction, decentralized identity, L2, etc. For new users, it is simpler, faster, and cheaper to use (because the complexity of operations now blocks a large number of ordinary people from entering the cryptocurrency field). On the other hand, there may be a large influx of funds brought about by Bitcoin network innovation (compared to now, it is just meme speculation), such as Bitcoin NFT or others. The transfer of assets and identity mapping between Ethereum and Bitcoin will also become a rigid demand.

The Ordinals protocol was officially launched on December 14, 2022. The Ordinals protocol does not require any centralized or trusted parties to participate, nor does it rely on any Layer 2 or sidechain solutions. It fully complies with the rules and security of the Bitcoin network. It is particularly suitable for storing large asset BTC NFTs, making BTC NFTs highly likely to be high-priced projects.

Similar to Bitcoin’s situation in the first two bull markets, Ethereum may lose its dominance in the blockchain field in the next bull market (not in terms of market value, but in terms of adoption by more people).

Cross-domain integration is the future direction of blockchain development. Cross-domain blockchain projects will prosper, even more than traditional blockchain projects.

I have been emphasizing for the past two days that capital is a global and cross-domain perspective, and will not only focus on the cryptocurrency field. With the rise of artificial intelligence, large capital will naturally shift to newer directions. There are still many emerging fields in the future, such as decentralized social networking, brain-computer interfaces, nuclear power applications, space technology, and so on. Recently, artificial intelligence has taken the attention of capital.

Cross-domain integration may be the integration of decentralized social networking and cryptocurrency, or the combination of artificial intelligence and blockchain, or even the combination of brain-computer interfaces and blockchain. They all have the possibility to replace Ethereum and seize the new dominance of the future blockchain field. The most likely is the combination of decentralized social networking and blockchain, and the combination of artificial intelligence and blockchain. One possible achievement of cross-domain integration is to break through the barriers between different blockchains with “alternative paradigms”, rather than being limited to the original blockchain category to solve the problem of asset cross-chain and identity cross-chain of different blockchains.

So, Ethereum’s successor may not necessarily be a pure blockchain project that we think it is, but more likely to be a cross-domain fusion project with more users and activity, and higher capital liquidity, which is the indicator. The market value is small at the beginning because it is also just starting and needs to grow. Bitcoin and Ethereum have both been developed for many years.

Aside from Bitcoin and Ethereum, the next big thing in the upcoming bull market could be Uniswap, a decentralized exchange (DEX) that has the potential to become a crypto giant like Binance. It is even normal for a Dapp’s revenue to surpass that of the Ethereum public chain. This is actually a battle between DEX and CEX. Similar to the beginning of CEX, personal address security is now the top priority (problems like wallet theft and lost private keys require more perfect solutions), and related infrastructure needs to be improved.

The four main decentralized social protocols currently in use are Nostr, ActivityPub, Farcaster, and Lens Protocol. I have the most confidence in Nostr. Farcaster is too complicated, with an extra layer of ID, and the real users are not the actual “deep users” at the bottom, but rather VCs with low usage frequency. It will be difficult for this kind of product, which is obviously VC-driven, to become the future Facebook or WeChat. Lens has no innovation and is just a hype for socialFi, which is just a flash in the pan.

Web3 social networking will develop from the bottom up, which is different from what we see today with DeFi. DeFi projects are driven by large-scale capital, and even so-called community-driven ones are actually driven by large capital, even without VC control. The financial sector is dominated by large capital, and centralized social networks are dominated by big players. However, decentralized social networks need to develop from the bottom up, which is why Twitter’s founder is pushing for decentralized social networking.

The following paragraph is from Matti:

Identity first, application second, and you don’t need to be locked into one platform to get identity. Our blockchain (mainly ETH) addresses are gradually becoming our user profiles. This is the way in which the interaction between users and networks will slowly reverse, with identity (address) becoming the primary and applications becoming secondary. The network will become the native social network, and users will not have to rely on closed social media platforms to facilitate contact with other users. Enabling token clusters is one way of defining communities. With the surge of non-fungible, verifiable identifiers (also known as soul binding), we may enter a Cambrian explosion of tags that makes social activities possible. This means that encrypted “Web 3 social” will develop from the bottom up.

The essence of all technology is to gather energy and information through communication. In fact, the essence of art is also communication. Art is easier to communicate than pure symbols. The memes we know are in the form of images, not abstract symbols, and music is easier to resonate and spread.

So memes are essentially the same as technology. Don’t underestimate them.

Art that cannot be spread is not art.

This is my judgment of art. Don’t talk about how beautiful a painting is, that’s ignorance. If it cannot be spread, it cannot be called art. Art itself is meant to resonate, the more people resonate, the better. From vulgar art to elegant art, almost all so-called elegant art starts from vulgar art.

Artists who are good at capturing the trend of the times may produce influence for hundreds or even thousands of years, such as Wu Daozi, Xu Wei, Van Gogh, and Picasso. In fact, Van Gogh’s extensive dissemination was done by his descendants.

The artists who are most likely to have an impact on the future today are definitely not what we learned from textbooks in the classroom. Whether it is abstract or freehand brushwork, it is impossible to create something that will affect the future. The most likely to create something that will affect the future is in the blockchain field, or perhaps in the field of artificial intelligence. For example, Beeple’s artwork sold for over $60 million. No matter what you do, the most fearful thing is to have a limited perspective and always think that the past is the best. The things that can be left in history are those that keep up with the times.

If the whole world is a zero-sum game, then now is the same as ten thousand years ago. The characteristic of human beings is that they can create “new” things. If the new things have the function of gathering energy and information, then it is evolution. The overall global wealth is added, not zero-sum.

Bitcoin may not necessarily be the largest in the future. Before Ethereum surpasses Bitcoin, new cross-border and integrated encryption projects have emerged.

This is my latest view.

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