Crypto Beans - Jan 29, 2023

Read time - 6 mins

Hey there everyone! 👋 This is Shivam

I bring to you the 5th weekly edition of Crypto Beans for the year 2023. We are closing in on the first month into the year and have received amazing feedback on the newsletter🚀, I feel super stoked for what lies ahead.

In this edition I also talk about "The Creator Economy or Web3: The talk of the town these days". 

The global internet revolution was always considered to be an outcome of perpetual innovations. From Web1 to Web3, the way web and computer systems have evolved in the last two decades, Loading.....

What is in it for you?

For all my friends who are getting this for the first time, this is an effort through which I try to share my thoughts on the crypto space and help you stay updated on the basics of the industry.

This is your 0 to 1 guide in crypto if you are looking to learn more about crypto and what it stands for. Okay done selling it 😛

Let's take off on this journey together 🚀 🚀 

State of Crypto affairs? A quick look at the market

The global crypto market currently stands at $1.09 Trillion. It is still ~60% down(👎) from its all time high of $3 Trillion which it hit in November 2021.

New year new highs: The market has been going up since the beginning of the year.

The global cryptocurrency market cap today: $1.09 Trillion

Weekly change: 0.67% | Yearly change: -39.78% 

Bitcoin (BTC) is the largest cryptocurrency with a market cap of $444 Billion.

Weekly change: 1.72% | YTD change: 39.24%

 Another important metric is Bitcoin dominance which can be used as a rough indicator of the relative strength of Bitcoin versus other cryptocurrencies. 

A high Bitcoin dominance means that Bitcoin has a large market share and is potentially more influential in the overall cryptocurrency market and vice-versa.

Bitcoin dominance: Current Year: 42.15% | Last year (Jan 2022): 41.60%

Top crypto projects/protocols by different metrics

The Interesting thing to note here is that although Tether (USDT) has just $68B market cap, it is traded the highest with volume close to $34B given its use as a stablecoin for the exchange of assets. Meanwhile, Stablecoin market cap is at $138 Billion and has a 12.73% share of the total crypto market cap. 

Greed and fear index

The market has been roaring in 2023 with renewed hopes of Bitcoin leading a rally to the moooooonnnnnn........ (get ready for the ride)

Note: The data used is based on metrics like Volatility, Surveys, Bitcoin Dominance, Social and Google Trends. Source: Coinstats

 Is ETH ultrasound money?

Let's have a look at Ethereum supply changes post its merge to a PoS blockchain from PoW, as there is a shift in the narrative for Ethereum to become a store of value due to the expected reduction in ETH emissions. (Super Bullish)

The graph highlights POS vs POW issuance since the merge. Impressive numbers, look super bullish for ETH long term given the supply of ETH is not growing as before

Supply change since merge POS  -4,293 ETH

(Eth has officially less supply post merge, here is a look at the 2 year supply projections) 

Spill the beans (Explain to me like a 5 year old)

The Creator Economy: hmmm, achhh, theek

The global internet revolution was always considered to be an outcome of perpetual innovations. There was a time when people were staring at a few static pages on a computer screen, and now they are having a real-life experience with a VR headset entering a Metaverse to shop for their favorite NFTs.

So the question is how did it begin?

What was Web1?

The first era of the modern internet — roughly 1990-2005— was about open protocols that were decentralized and community-governed. Most of the value accrued to the edges of the network: users and builders.

Web1, a simple and static version of the internet, where users could only access information through HTML pages. This was the beginning of the internet era, where only a few individuals and organizations had access to create and share information. But as the internet grew, so did its capabilities and features, giving birth to the Web2.

The second era of the internet — roughly 2005-2020 — was about siloed, centralized services. Most of the value accrued to a handful of large tech companies.

Web2, the era of social media and interactive websites, brought about a revolution in the way we use and share information. It allowed users to create content and connect with others, giving rise to platforms such as Facebook, YouTube, and Wikipedia. This era also saw the emergence of e-commerce, online banking and other transactional services.

We are now beginning the third era of the internet — what many call web3 — which combines the decentralized, community governed ethos of the first era with the advanced, modern functionality of the second era. This will unlock a new wave of creativity and entrepreneurship.

But isn't what we have today already good? Why change that?

The internet as we know it might be flawed, because after friendly beginnings, web2 companies have become more extractive and less cooperative

Think how Facebooks and Twitters of the world have unimaginable power over you and others 😮😮😮  

However, as we stand on the brink of the next wave of technological advancement, we are about to enter the era of Web3. Web3 is a decentralized version of the internet, where users have more control and autonomy over their data and online interactions. It's built on blockchain technology, which enables a new level of security, transparency, and interoperability.

In Web3, users have the power to control their own digital identity, securely store and share data, and engage in new forms of online commerce such as decentralized finance and digital asset trading. It also enables new opportunities for innovation and entrepreneurship, as developers can build decentralized applications on top of the blockchain infrastructure.

One example of this is a decentralized marketplace, where buyers and sellers can interact directly without the need for a centralized intermediary. This allows for greater security and transparency, as all transactions are recorded on the blockchain, and also enables new business models and revenue streams for creators and developers.

What is Web3 all about? Let's break it down graphically

Web3 gives people property rights: the ability to own a piece of the internet

Web3 aligns network participants to work together toward a common goal — the growth of the network

Web3 empowers a collective owned future over a corporate or government owned future

Understanding Web3 relies on analyzing the shift: Web2 vs Web3

Trump was blocked on Social Media - that's not freedom but huge exercise of power by the companies. Basically what I am trying to say is that Web2 has few basic ideological issues:

1. Lack of control and autonomy for users: In a centralized system, users have to trust the centralized platform or service to handle their data and online interactions. They have little control over how their data is used or shared, and are subject to the policies and practices of the central entity.

2. Security vulnerabilities: Centralized systems are often targeted by hackers and other malicious actors, as they represent a single point of failure. If a centralized system is compromised, it can have a wide-reaching impact on users.

3. Monopolies and lack of competition: Centralized systems often become dominant in their respective markets, which can lead to a lack of competition and reduced innovation.

Vs

1. Control and autonomy: In Web3, users have more control over their own data and online interactions, as they are stored on a decentralized blockchain rather than a centralized server. This allows users to have more autonomy over how their data is used and shared.

2. Security: The decentralized nature of Web3 makes it more secure, as there is no single point of failure that can be targeted by hackers. Additionally, transactions on the blockchain are recorded immutably and can be audited, making it difficult for anyone to tamper with the records.

3. Competition and innovation: Web3 enables new forms of online interaction and commerce that were not possible before, opening up new opportunities for innovation and entrepreneurship. Additionally, the decentralized infrastructure of Web3 allows for greater competition and innovation, as developers can build decentralized applications on top of it.

In conclusion

Web1 was the foundation of the internet, Web2 brought about the social media revolution, and Web3 is set to revolutionize the way we interact, transact and share information on the internet.

It's an exciting time to be a part of the digital world, and we can't wait to see what the future holds.

What's brewing today? Bringing fresh beans to you:

WazirX Says Binance Lied About Ownership as Dispute About India’s Largest Exchange Escalates: The back-and-forth about the ownership of WazirX could have a devastating effect on the Indian exchange and its users.

Solana Unveils App Store For Saga Phone: In contrast to Apple’s App store and Google’s Play Store, which levy a 30% fee on all transactions, the Solana store will be free to use, and leverages Arweave, a decentralized file storage protocol, making it resistant to censorship.

White House Calls on Congress to ‘Step Up Its Efforts’ on Crypto Regulation: Officials in the Biden administration urged Congress on Friday to expand the authority of regulators to police the crypto industry.

Whats meme-ing?

And now the funny part, what happens when the prices go up

What did you think of today's edition?

Reach out to me on Twitter or Linkedin for any feedback :)

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.