The digital rEvolution..
Lately, I have been having great conversations with regards to the technology that I usually cover on this newsletter. Some conversations originate from questions such as: Is Bitcoin a Scam? Are cryptocurrencies manipulated? Why would anyone buy an NFT? How are these new protocols democratic if you still need money to access to technology and information to enter the game? Where is all this going to be 5–10 years form now? Will the government regulate cryptos out of existence?
These and many other questions make perfect sense and make you think harder about the craze that is currently surrounding the space. By March 2021, trading volumes for NFTs on Ethereum totaled more than $400 million. Bepple sold an NFT for $69 Million. Yes, one NFT instance, a digital image, for close to $70 Million. NBA’s Top Shots, a trading card system, has already made more than $230 million. CryptoPunk (The CryptoPunks are 24x24 pixel art images, generated algorithmically. Most are punky-looking guys and girls, but there are a few rarer types mixed in: Apes, Zombies and even the odd Alien. Every punk has their own profile page that shows their attributes as well as their ownership/for-sale status) #6965 sold for $1.54 million. Kings of Leon is a band that sold their album in the form of an NFT earlier this year and generated around $2 million. The music industry is warming up to this new trend breaking the $50 million mark in 2021, and this is just the beginning.
Bitcoin, the first and most popular cryptocurrency in circulation has appreciated in value more than 1300% in just one year, making many millionaires and billionaires in the process. What is really going on here? Is this revolution and wealth creation here to stay? is this real?
Well, I think that yes…. Hard to believe, but it is here to stay and its just warming up.
As we have mentioned before, the pandemic has accelerated everything technology oriented and any digital aspect of our economy. In part, because we are spending a lot more time in front of screens than ever before, using more applications. Companies and entrepreneurs are paying close attentions and are leaning towards digital creations rather than tangible products. As generations grow, their digital habits will cement and their digital world and digital spending power will become stronger. Now a days, kids buy skins and other features to improve their video gaming experience. For them, the purchase of NFTs, the trading of Crypto, and the use of any other Decentralized financial product makes perfect sense. They really do not think twice about it, everything is done over the phone and the more independent the process is, the better. Theirs and our world is digital. This newsletter is available because of our digital habits, I can easily sell it as an NFT or just monetize it if I decide to. Perhaps I can collect if crypto (which i would prefer).
Before, in order to show your status, conspicuous products were those like expensive cars, luxury clothing brands, plush homes and very pricey art hanging from our walls. Now, we are all living in a metaverse, hence for some individuals becomes clear that the “showing off” is not happening in the physical world anymore.
The day is here, where people want to upload an expensive cryptopunk as an avatar to communicate access or wealth. Investment vehicles are not physical as much as they used to. I can own a million dollar NFT or large amount of Crypto and sell it anytime, to anyone regardless if I know the person or not, on any platform of my choise, from anywhere without the need of a broker (i.e. traditional Art, Homes). I can become a trader without the need of a special license or a masters degree. The tokenization of our world is here to stay, and anything that can be tokenize will be. Are we building castles in the sky? I’m sure we are, but some will be able to stand, others will fall, but many others will be erected and will be higher and stronger.
So yes, to a certain extent, this technology has democratized wealth in many forms. But at the same time, many who do not have the money to enter this industry are left out, many others who do not even have a stable device and/or stable internet connection can not even learn about how blockchain is turning the world up and down. Like any rEvolution there are the early adopters, the laggards and anything in between. At least in this one, I see more democratization and global access than in previous ones, and all of us can actually accelerate the democratization process by sharing information and access.