Internet, next, internet of crypto?
The way we see it, engaging with the young generation today is a crucial piece to accelerate the mass adoption of crypto digital assets.
Crypto Network Effect
Just like social media, the network effect applies to the crypto token economy. The more people owning and utilizing the tokens, the more useful the cryptocurrency network is in generating value.
How does the crypto network effect come into play?
Treat the crypto network as a “market for X”. For example, a market for user attention. We all know that time and human attention is the scarce asset in the world of increasing abundance (at least for first-world countries).
So, imagine that every time you use Instagram, you will receive Instagram tokens to reward your time well spent. You might think, this is too good, I am not working on anything, why would let’s say Instagram reward me tokens?
Well, Instagram is analyzing your behavioral data and selling them to third-party advertisers, which then allow them to dissemble targeted information that induces your consumption behavior.
Have you not noticed that your IG Feed, YouTube recommended watch, Facebook posts, TikTok videos, are all converging in similar themes of content?
So, imagine if the next IG or TikTok (call it GameZ) are built on a blockchain, with GameZ tokens distributed to users for rewarding their valuable time usage, and the creators of GameZ also get a fair share of the tokens at the beginning.
GameZ application and user data are valuable. The more users using GameZ, the larger is the GameZ network, and the more valuable are the data. Here is how GameZ tokens can become valuable — either 3rd party businesses who want to pay tokens to access slices of user data they are interested in buying, or users pay other users tokens for the features they want to use in the platform.
So, this sounds more like a fair system to users, at least.
But there is no incentive for app builders
App builders may not have the incentive to incorporate crypto tokens.
Yet, in certain use cases, market nature may incentivize the formation of a crypto ecosystem for applications. For example, if Instagram and Facebook offer similar app experience and use case, but Instagram offers tokens to users and you can actually sell the tokens for actual money. Then, more users should choose Instagram over Facebook.
This takes time, and there are a lot more other factors in play. But, if thefuture offers such an alternative in which users can be compensated by their digital footprint/activities, why not?
And users are king. That is why the current internet world is dominated by GAFA (Google, Amazon, Facebook, Apple) and BAT (Baidu, Alibaba, Tencent). Because they have MANY USERS.
And now, digital businesses need to take serious consideration of user incentives as users are becoming smarter to find better alternatives out there. The nature of the market will eventually introduce crypto token economies on top of digital interactions.
More apps and digital tools with tokens
It is exciting because cryptocurrencies capture the value of service provided in the digital world. That is why cryptocurrency will form the bedrock of the monetary economy of the internet, as human beings are spending an increasing portion of their lifetime in the digital world with VR, AI, and IoT enhancing such experiences.
Such a new token economy creates a more fair and transparent system of internet economic wealth distribution. If you wonder how, you can take a look at this article written by Union Square Ventures.
Well, the challenge is, there need to be people who start using applications that are based on the crypto network powered by blockchain. If everyone is stuck on using legacy financial and internet services, the crypto network will be worth nothing no matter how advanced the cryptography or game theory incentive mechanism is.
This is why, as firm believers of a future where crypto will play a part in our everyday life, our team at Roostoo is working on fostering interest, knowledge, and exposure of crypto digital assets, specifically to the young generation like ourselves.
Current Status Quo
The status quo of the crypto-world is a lack of mass adoption. In fact, immediate mass adoption would be very difficult to achieve. Over the past decade, cryptocurrency was largely seen as a tool for speculation and trading. But remember, it also took the internet a full 20 years to hit mainstream.
There are two pillars that differentiate crypto from when the internet era became mainstream.
Firstly, we now have all the necessary infrastructure for accelerating any type of adoption. 5G, smartphone, big data, all complements the incentive of having more human beings acting as digital users.
Secondly, there is a financial element in crypto. Crypto is a new type of real money, because it is increasingly used by consumers and businesses as a medium of exchange. When money is involved, there is always an extra push of human incentives for adoption. It’s just human nature. As famous venture capitalist Marc Andreessen put it, “Bitcoin offers a sweeping vista of opportunity to reimagine how the financial system can and should work in the Internet era.”
This is why we are doing Roostoo
Given the current status quo and the anticipation of a global token economy, Roostoo is hoping to increase the awareness and interest of young people on the exciting future of cryptocurrencies.
To start off, we build a mock crypto simulation app for anyone to have a virtual portfolio while mock trading real-time with the market. One barrier for young people is the lack of understanding and a risk-free way for them to interact with cryptos. Most youngsters wouldn’t want to delve into the complexity of cold wallets and private keys, before even knowing what Bitcoin actually is.
Gamifying the crypto experience is different. There is no risk, no paywall, no obligation to sign up, no barrier for use. This is perhaps the most welcoming way to enter the mass of users who have not known much about the crypto movement.
Furthermore, we are introducing a competitive aspect of crypto trading into our app. We are allowing third parties, such as university clubs, to host their branded contests on the Roostoo app. The competitive nature will hopefully intrigue the curious and fun minds who want to engage with their peers.
While top researchers, developers, and entrepreneurs are building advancements to address the technical challenges of blockchain and crypto applications (e.g. privacy, scalability and incentive mechanism), Roostoo is working on disseminating the positive narrative of crypto tokens to the youth today.
We are receiving university interests globally to collaborate with a startup that also rooted in a university. More about our launch of the new mock trading competition feature will be covered in the next blog article. Meanwhile, thanks to the amazing people who keep building the foundation amidst the crypto winter. It gives a huge boost to the next wave of “crypto mania”, and this time, the infrastructure will be ready to support the high volume of interest.
Roostoo is a start-up based in the University of Southern California Incubator, co-founded by three core members of the Blockchain@USC community.