Web3 Will Change The World
Here’s How It Can Change Yours
By Ezra Fuller
I was first introduced to Bitcoin in 2017 as a freshman in college. Computers were always a big interest of mine, so when I discovered I could earn passive income by mining Bitcoin, I wanted to learn more. For those unfamiliar, mining Bitcoin means having a computer running 24/7, crunching numbers to secure the Bitcoin network. As a reward for the computer’s hard work, you earn Bitcoin.
The following weeks changed my life forever… I learned that Bitcoin was much more than a simple passive income stream. Bitcoin, and the cryptos it inspired, are unlocking a new sector of financial possibilities. From a worldwide decentralized store of value, to the next generation of community building, cryptocurrency is quickly transforming the internet as we know it. And you, reading this right now, are standing on the ground floor.
Over the next 10 years, we’re going to watch the internet transform from a web of information, to a web of ownership. Your research is the key to unlocking its opportunities while we’re still early. The next generation of internet ownership allows you, and the creators you follow, to create an entirely new economy around content. The decentralized network of global money has a lot to offer. Opportunities range from 20%+ APY earned on interest, to turning the creator revenue model upside down. Current creator revenue models rely on ad revenue from the platform their content lives on and collaborations with companies.
With the new opportunities crypto has, anyone on the internet can raise funds directly from their biggest fans and give major benefits directly to them with no middlemen.
Many creators that do this offer a limited supply of their digital assets. So as the creator gains popularity, the demand for their rare digital asset goes up. Collectors receive benefits directly from creators they love while the price of the asset they bought has the chance to go up in price. This means collectors benefit directly as the creator they love gains popularity. Investing in individual creators and platforms means you can turn your expertise in a niche subject into tangible investments.
Think of it this way… All social media platforms rely on user generated content. Every time you post on Facebook and Instagram, your content is contributing to their ability to capture consumer attention. Shouldn’t you be better compensated for the content you create?
Crypto offers the solution for creators to be compensated in a fair way, where they get to retain the value. It offers the same thing for collectors, because the creator’s success gets passed onto the collectors.
The opportunities the crypto landscape offers are so revolutionary, new opportunities are being created everyday, and many of the world changing ideas haven’t been implemented, or even thought of yet…
At the time of writing, Whatsapp has the most users of any app in the world. Whatsapp was created in 2009, 44 years after the first email was sent. It takes time for technology to be created & adopted. It often happens slowly, then suddenly.
We can imagine the apps in the cryptocurrency ecosystem being like the first email being sent, or iBeer, the app that made the iPhone seem so cool in 2008.
In other words, it’s hard to imagine what will be possible in the crypto ecosystem, because the tech is so new. The networks need time to mature and become more robust. The developers need time to create complex apps, All we need is patience and a keen ear to innovation in the space.
But before exploring ALL the opportunities crypto has to offer, let’s start with the basics. This article is a primer on the largest cryptocurrency, Bitcoin, and the second largest cryptocurrency, Ethereum. Along the way, I’ll offer a few examples to spark your imagination and help you find areas of crypto you’d like to learn more about.
Bitcoin As A Hedge Against Inflation
My exploration of Bitcoin taught me more about traditional finance than any classroom did. The first idea that sold me was using Bitcoin as a hedge against inflation.
Being born and raised in America, I’ve been fortunate to live in a country with one of the most stable economies. The American dollar has been the world’s reserve currency since WWII, used to issue and settle debts across the world. In some countries, the U.S. Dollar is more sought after than the money their government issues.
And yet, because saving rates are lower than inflation, American citizens lose purchasing power everyday their money sits in a savings account. With current events during COVID, over 18% of all dollars in circulation were printed in 2020 alone.
The Dollar used to be backed by gold, allowing you to redeem gold for every dollar you held. But in 1971 President Nixon took us off the gold standard allowing the dollar to be printed on a promise of paying it back later.
After reading Rich Dad, Poor Dad by Robert Kiyosaki, I learned that people make their wealth by having their money make money. The idea of using a savings account to create wealth was thrown out of the window.
Let’s talk about how Bitcoin offers you and everyone in the world a hedge against inflation and centralized money systems.
Bitcoin’s Supply
Bitcoin is deflationary, meaning there is a limited amount that will ever exist. 21,000,000 Bitcoin to be exact. This means out of all 7.8 Billion people in the world, if you own .0026 Bitcoin ($158 as of writing), you have more Bitcoin than the average human can. And for the record, you don’t have to buy a whole Bitcoin. You can buy as little as a $1 worth of Bitcoin on platforms like Coinbase and CashApp. There’s a common saying in the crypto community… ‘Not your keys, not your coins’. It’s generally a good idea to send your coins to a wallet where you hold the Secret Recovery Phrase, especially if your holdings get to a significant amount ($1,000+)
You may be wondering… How do we know there will only be 21,000,000 Bitcoin? Remember when I talked about mining Bitcoin in the beginning? This is where the rules of Bitcoin supply are enforced.
Miners run a piece of software to secure the Bitcoin network using a Proof of Work algorithm. The concept of Proof of Work is a beautiful and complex system. If you’re tech savvy, I urge you to deep dive into the Proof of Work algorithm because it’s truly a beautiful system.
Simply put, the Proof of Work algorithm connects thousands of computers across the world, all working on a complex math problem. This math problem is designed to use electricity, and all the miners who want the block reward must participate. In the process of spending electricity to solve the math problem, the network of computers ensures the sender of Bitcoin has enough bitcoin to send, and ensures the receiver gets the Bitcoin.
As a reward for using computing power to secure the network, miners receive brand new Bitcoin, adding new Bitcoin to the overall supply. Once 21,000,000 coins are mined, there will be no more Bitcoin produced, but the current Bitcoin will still be available to purchase on the market.
The number of new Bitcoin that miners receive follows a schedule. The number of new Bitcoin rewarded to miners gets cut in half every 4 years until the total supply of Bitcoin reaches 21,000,000, as shown in the Bitcoin subsidy chart below. The chart doesn’t show it, but the last Bitcoin will be mined in the year 2140, about 120 years from now.
Source: CoinDesk
This is how the Bitcoin supply is determined and capped at 21,000,000 Bitcoin. This capped supply is why Bitcoin is a deflationary asset. With entire countries adopting it as their legal tender, we see there’s demand for a decentralized, global payments network hosted & secured on the internet. At the time of writing, around 18,855,000 Bitcoin have already been mined. That’s ~90% of the maximum supply.
So what happens after all Bitcoin has been mined? For every Bitcoin transaction, there’s a miner’s fee. The higher the fee on your transaction, the more likely you are to have your transaction included in the next block of transactions in the blockchain, resulting in a quicker settlement of your Bitcoin payment. Eventually, the fees that miners receive per transaction will be worth more than the Bitcoin rewarded to miners. This means the miners will still be incentivized to support the Bitcoin network after all Bitcoin has been mined.
As long as there’s at least one computer securing transactions on the Bitcoin network, Bitcoin will work as a global, borderless, decentralized, permissionless payments infrastructure. The total number of computers securing the Bitcoin network is estimated to be between 800,000 and 3,000,000 computers around the world, so it’s not at risk of being shut down anytime soon. The network’s ability to stay up and running via independent computers around the world is what makes Bitcoin global & decentralized.
But what makes Bitcoin borderless & permissionless? The computers that verify transactions care about one thing. Does the sender actually have the amount of Bitcoin they wish to send? The computers don’t care where you live, who you are, your credit score, or what you recently said about your government. You don’t have to do an identity check to send Bitcoin. If you have Bitcoin, the transaction will go through. This allows anyone or any business to plug into the global payments infrastructure.
Bitcoin is also great because anyone can build new improvements. Bitcoin is an Open Source technology, meaning there’s no single person or entity who’s in control. Everyone is in control, and the best features rise to the top. If you identify a feature that makes Bitcoin a better payments network and store of value, you can create it, and the community votes to add it to the network.
This is how the internet started. The internet connects information across the world, and allows anyone to build anything on top of it. Bitcoin does the same thing, but instead of connecting information, it connects worldwide, decentralized, deflationary money.
Ok, so that’s the primer on what makes Bitcoin a revolutionary technology. If you don’t understand it at first, don’t worry. It took me a lot of time to ‘get it’. Don’t be afraid to ask questions and talk with others in the space you trust to ask questions.
Ethereum
What if we take the idea of a global, borderless, decentralized, permissionless payments infrastructure, and expand it into a global, borderless, decentralized, permissionless asset infrastructure?
This is where things get very exciting.
Ethereum is the second largest cryptocurrency network, right behind Bitcoin. With Ethereum, you have the ability to create decentralized applications using unstoppable code called Smart Contracts.
Smart Contracts adds a new dimension of what value on the internet can do, because money can be programmed to do whatever you want. The future of internet ownership will allow you to sell your video game assets for money, meaning the consumers of the content get to benefit, not just the creators. But it doesn’t stop there…
DAOs (Decentralized Autonomous Organization)
Ethereum & Smart Contracts allow the formation of DAOs, standing for Decentralized Autonomous Organizations. In a DAO, people pool their Ethereum together to act as a decentralized collective of like minded individuals, making decisions for the betterment of the collective. Some of them act as charities, non-profits, or even full blown companies. In recent news, a DAO was created to buy a rare copy of the United States Constitution. Within 72 hours, they raised $47,000,000 in ETH from people around the world, a crowdfunding record.
NFTs (Non-Fungible Tokens)
You may have heard of NFTs already, and Ethereum is the network where NFTs were first used on a mass scale. NFT stands for Non-Fungible Token, which means each NFT is an individual, unique digital asset.
NFTs may take the form of art that’s created & secured using the Ethereum network, or an NFT that represents digital memberships with exclusive digital content given to collectors, and even tickets to physical events across the world.
“Anything you can do with a web page, you can do anything you can do with NFTs, but on top of it, you can have scarcity, ownership, allocation and rights associated with it. This is really big.” — Naval, Tim Ferris’ Podcast #542
The creator of the NFT gets to set the rules for what the collectors of the NFT gets. Additionally, when the NFT is sold on the secondary market, the creators can get a cut of the sale, meaning they get recurring revenue on the NFT forever.
Owning NFTs like art, memberships and access to creators is a form of showing your interests as a human. The benefits the NFT collectors receive attracts people with similar interests to yours.
For example, I’m a collector of VeeFriends, made by entrepreneur GaryVee. His fans tend to be genuinely good humans with business smarts. Through virtual & physical events with other VeeFriend owners, I’ve met people who will be lifelong friends. We aligned with GaryVee’s values enough to purchase one of his creations, and it turns out we get along really well. Purchasing NFTs that align with your interests make it easier to find ‘your people’.
My friend Jon Torrey (we met via NFTs & VeeFriends) mentioned meeting people through NFTs is similar to what his grandma explained when he was younger… For immigrants to the US, Churches were a mechanism of grouping to “find their people’’ and avoid discrimination. The stakes may be lower, but this NFT purchasing allows you to enter a community and find your tribe of people.
Just like there’s hundreds of Instagram accounts that speak to your interests, there will be hundreds of NFT projects that speak to your interests. What you spend your money on is a bigger show of who you are than what you post on Instagram, so the connection you make through purchasing NFTs can be deeper, quicker, than connections you make on current social media apps.
NFTs Will Change Video Games Forever
Another major use case we’ll see play out over the next few years is NFTs in video games. Right now, items you unlock have to stay inside the game, and when the new version of the game comes out, your progress is lost and you have to start over.
Imagine you get to own the items you unlock, trade them with other players, or even sell the items for real money when you’re done playing the game. This means you can earn money playing video games simply by unlocking items and selling them to other players. Additionally, an NFT you unlock can be ported into other games, giving the item totally different abilities in other games.
Metaverse
This digital ownership will translate into the metaverse, a virtual space where people spend time socializing, playing games, and hanging out with their friends.
Talk to any elementary school kid, and they’re already doing this in Minecraft, Roblox and similar games. To see where the future is headed, look for what kids are doing. They fully understand the idea of buying virtual skins in video games and they already socialize with friends in role playing video games. In the metaverse you’ll be able to own the digital items and show them off to your friends, or anyone across the entire world, finding ‘your people’ with similar interests easier.
POAPs (Proof of Attendance Protocol)
Digital ownership allows for real life achievement hunting, kind of like geocaching, but for online & physical events. One tool is called POAP, or Proof of Attendance Protocol. You use your Ethereum public address to claim your POAP and show that you attended an event, completed a quest in a game, or any other reason the creator of the POAP allows you to collect.
Since this is my very first article I’ve every written, I’m releasing a POAP that’s free to claim! Think of it like a collectable that proves you read this far. It probably won’t have any value in the future, but owners of the POAP might get something cool in the future… All you need to do is download the POAP app on your phone, input your Ethereum Public Wallet Address and enter the secret word earlyadopter. Claiming the POAP will be available until 11:59 EST on December 12th, 2021.
Fractional Ownership Of Physical Property
Another example the Ethereum asset infrastructure allows is the digitization of physical property. If you own a rental property, you can raise funds through a crowd sourced token sale. The people who invest in your token gain a fraction of ownership in property, and in return, they get a token representing their ownership.
Anyone who owns a token gets a percentage of the rent money every month. When the landlord does this, they essentially do a cash-out refinance of the home via a worldwide pool of crowdsourced money, and they can use the funds raised to buy another rental and repeat the process.
This fractionalized ownership isn’t limited to just real estate. ANYTHING can be fractionalized. A business, sports cards, collectables, physical art…
Ethereum allows the ownership of virtual private property on the internet. Ethereum and similar cryptos cut out the middleman. The artists that host their music on Spotify earn pennies on the dollar compared to the money Spotify makes from it.
With Ethereum, you can create an NFT of your album, sell it to your fans, and all that revenue is yours, and yours alone. From there, every time your NFT is resold, you can earn a cut of the resale forever. The best part is those that buy are your biggest believers. As you succeed, they directly benefit alongside you.
Earning Interest On Coins You Own
On Ethereum, there’s websites that allow you to lend your Ethereum to anyone in the world and earn interest, anywhere from 5% APY, 20% APY, and even 6,000% APY . This form of interest bearing revenue has always been exclusive to high net worth individuals and banks, but now anyone can earn decent interest on the money they own.
Ok, so that’s a lot of examples I listed off. Get up, drink some water, walk around and use that time to digest what the world of digital ownership can mean for you. These examples are the early examples of what a global, borderless, decentralized, permissionless asset infrastructure can do. Remember, we’re still in the email era of this technology, and the social media era of online hasn’t even been imagined.
If this article sparked your interest, and you’re looking to take action, I would recommend buying some crypto of your choice. Start small, and see how you feel watching the price fluctuate up and down. Do more research, buy some more, and look for areas of the crypto space you can see yourself succeeding in.
My name is Ezra Fuller, I’ve been in the crypto space for 4 years and I’m super passionate about helping people get started in their crypto journey. If you’re looking for one-on-one help, answering questions you have, DM me on Twitter or Instagram @ezrawithacamera.
I’m offering private consultations to help you get started in crypto, avoid common mistakes, find your place in the crypto ecosystem and make the most out of this special time.
Or just reach out with questions or just say hi :)
If you found this helpful and would like to support my work, here’s my public address’ open for donation.
Bitcoin: 33FAev4ZWm525BLs5woxC2csAtsEmNDeu8
Ethereum: 0xc8b2205CBc08e3C81Cd23f0f06eB2dc5b0bD20d1
Solana: 5kfBWGrLy89rH8Z7N1T2EuWpJ7Rx6sU3dbxR9VPEXR8L
Olympus: 0xc8b2205CBc08e3C81Cd23f0f06eB2dc5b0bD20d1
