🤠 Web3 Weekly Round-Up #11

Hey there, I’m Luca - lifelong startup nerd, crypto fanatic since 2016, and now keeping up with trends across Web3 is my second full-time job.

Here’s everything you need to know about the last week in Web3 - in 5 tweets 🐦

👑 #1 - The Prince of Crypto

Vitalik is the closest thing that Web3 has to a leader, a prince (as dubbed by TIME), or a deity (to some). He basically invented Ethereum at the age of 19, and he's been a major spokesperson of Web3's benefits since then. Now, it looks like Ethereum finally became a big enough deal to score Vitalik a TIME magazine cover cameo. The result was a hilarious deluge of comments likening Vitalik to Tom Brady, but Vitalik didn't even know who Brady was 😂 Luckily, Brady took it very well.

As for the actual substance of the article, Vitalik shared his biggest concerns with Web3. To summarize, they are 1) high transaction fees on ETH, 2) over-enthusiastic investors putting in more money than they're willing to lose, and 3) the flaunting of crypto wealth that can put newcomers off from Web3. According to Vitalik, these issues stand in the way of the greater good that Ethereum can be used for: experiments on concepts like universal basic income, fairer voting systems, and an alternative to authoritative governments and tech monopolies. Vitalik has no ultimate say in the direction that Ethereum takes as a platform - no single person does - but he's partially able to lead through his influence.

👥 #2 - Yuga Labs decentralized

It was another big week for Yuga Labs and the Bored Apes (BAYC) after last week's acquisition of Crypto Punks and Meebits. This time, Yuga released its highly anticipated governance token, which gives its holders a say in the decisions that the company makes. Most of the $APE tokens were sent directly to holders of Bored Apes and affiliated collections, but anyone was able to purchase the tokens on the secondary market. The result was an extremely volatile market that took over Web3 on the day of the drop. Several prominent BAYC holders sold their tokens for $50k or more, while some $APE investors were down 90% in less than 1 hour.

The massive financial success of BAYC has brought Web3's ethos of "by the people, for the people" under scrutiny. Venture investors into Yuga Labs received 14% of all $APE coins, giving them substantial influence in the BAYC DAO or a handsome payday if they decide to sell. That doesn't sound very different from the traditional world of startup investing, and to top it off, Yuga Labs just announced a $450M fundraise valuing the company at $4B.

Yuga Labs is an experiment that has been and will continue to be a telling signal for the rest of the Web3 landscape. What started as an unknown NFT collection in April 2021 became a fully-fledged ecosystem worth billions of dollars less than a year later. BAYC is looking to operate as a DAO to some extent, but Yuga Labs is also a fully-fledged company with ~50 employees that has raised venture capital as any startup would. There are lots of forces at play here, and we'll have to see how Yuga plans to navigate them.

💰 #3 - The financials of Web3 companies

You're probably tired of hearing about Yuga Labs by now, but I want to riff a little longer on its impact on the Web3 space (this is their last tweet, I promise).

Yuga is far and beyond the best example of what a Web3 project, community, and ecosystem can become. It represents the upper bound that any Web3 entity can hope to achieve, and it depicts just how powerful and lucrative that can be. At scale, a Web3 company is one of the most efficient businesses on earth because of the royalties it gets every time an NFT is sold. You launch a project, build a killer community, and the revenue starts pouring from your members' fanatical evangelism. Building this is far easier said than done, but it's attractive enough for big brands from everyday consumer products (Coca Cola and Taco Bell) to high fashion (Gucci and LV) to pursue Web3 as a meaningful channel. When done correctly, these projects and communities can create unparalleled returns on their investments.

🌍 #4 - How crypto affects sanctions

After Biden's promising Executive Order on crypto last week, this new bill feels like a total 180. The bill is spearheaded by Senator Warren and several Democratic co-sponsors as a way to enforce the economic sanctions recently placed on Russia. Economic sanctions seem like the primary method for keeping the world order in the 21st century, and the bill sponsors are concerned that crypto will make future sanctions ineffective.

There is, however, significant disagreement about the actual usability that crypto has for a nation-state like Russia to circumvent economic sanctions. It's true that a major part of crypto's appeal is that it can't be controlled by a single or small group of actors. However, there's not enough liquidity, even in the crypto markets, for an actor on the scale of a major world power to sell much of its crypto reserve in a short period of time. Plus, with the amount of on-chain sleuthing being done recently by individuals and specialized agencies, the anonymity of a liquidating cash cow wouldn't remain secret for long.

🧠 #5 - Crypto burnout

People in Web3 often say that crypto moves orders of magnitude faster than any other industry or market. Part of this is probably because crypto markets never close! The US stock market is open for 6.5 hours a day, Monday through Friday, for a total of ~32 hours a week. Even then, many jobs tied to the markets are known for their grueling hours. By comparison, the crypto markets are open a full 168 hours per week, more than 5x the time of the stock market, and thats not counting public or bank holidays. There's at least part of the reason why crypto moves so quickly...

With that said, markets that never close can put a lot of strain on people who follow or work in crypto. There are no breaks except those that are self-imposed. Hell, I've found myself skipping IRL events or waking up at 4am for NFT drops in different time zones, so I'm stoked that there's more attention being drawn to mental health in Web3. Getting deep into your Web3 journey is a blast, but make sure to look after yourself too 🙂

🎉 If you learned something new, forward this to a few friends! It goes a long way for me, your crypto-curious friends, and the growth of the Web3 community :)

💬 What did you find most intriguing this week? Let me know by replying to the email or tweeting at me - any and all feedback is welcome!