ArkStream Capital 2023 outlook: in which scenarios the on-chain one billion users’ applications will boom
In July 2018, Dr. Xiao Feng, chairman of Wanxiang Group, mentioned in a speech that “there are possibilities that a $5 trillion level company could emerge in the blockchain industry”, and at that time, the total market value of the entire crypto market was just over $200 billion, after a whole year decline, the figure came to $100 billion. From its highest point of $ 830 billion on January 7 at the beginning of 2018 to its lowest point of $100 billion over the course of a year, the entire crypto market fell 88%, a 50-fold gap from the $5 trillion market that Dr. Xiao Feng said. At that time, despair and confusion filled the minds of almost every crypto participant, and most of them were lost, wondering if there would be a future for the business they chose. Although DApps on Ethereum were taking shape at the time, and developers were constantly considering how to make more transactions happen on the chain, almost none could predict with certainty that two years later in the summer of July 2020, the DeFi craze ignited the crypto world, and the narrative of the entire crypto industry shifted from the underlying infrastructure, which was hard for users to perceive, to applications that generate real value.
So one public chain with 100 million Dapps, each Dapp creates $100,0000 economic value, and the entire public chain is a $10 trillion economy, how much currency does it need? It must be in the trillion-dollar range.
The monetary value of a public chain depends on the total economic value that DApps can create. The monetary value of public chains should be matched with the economic value, in accordance with a mature monetary theory.
So my conclusion is: there is a possibility of a public chain with a value of $1 trillion or $5 trillion will emerge.-Dr Xiao Feng’s statement in 2018
In the current cycle, we are experiencing a massive boom of the application layer and the protocol layer: thanks to multiple DeFi protocols beginning to develop and create value, the debate between “fat protocol” and “fat application” entered public view; public chains were no longer shackled to break through the “impossible triangle”, instead, ecological development was put first, and strategies such as perfecting developer ecology and setting up ecological funds to attract developers to migrate became necessary for the development of the underlying facility; blue-chip NFTs such as CryptoPunk and BAYS successfully came out of the circle and brought Web3 into the world. In November 2021, after BTC touched $69,000, the market capitalization of the entire crypto market reached $3 trillion, less than twice the $5 trillion predicted by Dr. Xiao Feng. According to centralized exchanges such as Binance, the number of global crypto users reached a volume of 100 million. Despite the long decline that began after November 2021, we have enough reason to believe that the bottom of the bear market is already present and 2023 is the important moment to carry on as the market clears further. Compared to timing opportunities, what we need to consider is, when the user volume increases by another 10 times, that is, when the number of global encrypted users reaches 1 billion and 15% of human beings start to enter Web3, which tracks will produce trillion-level applications? How will these applications evolve in the next cycle? We are going to look at several tracks from DeFi, gaming, etc. to talk about how we will plan for 2023.
Applications or Infrastructure?
To make it easier for readers to understand, we simply use the dichotomy to divide the whole industry, all the products that can directly interact with users are referred to as applications, including DeFi protocols, games, wallets, exchanges, etc., as for those which cannot be perceived in interaction but still support the operation of Web3 are referred to as infrastructure, including public chains, node service providers, data indexes, developer tools, etc.
We believe that the next cycle is likely to see a boom in the application layer, which is similar to the development path of the internet, at a time when physical devices and hardware were difficult to popularize, most developers focused on building infrastructure because there were no applications available, or the infrastructure did not support large-scale applications, and when a large number of users had the prerequisites to flood the internet, the industry giants became monopolistic application developers. After having a large number of users, these developers obtain the supreme power of “data” on the internet, which in turn occupies the voice of infrastructure in the “cloud age”. The same is true for Web3’s path. After several cycles of exploration, the voice of “application” has gradually increased, and after seizing users, it has become a feasible path for applications to build public chains suitable for their users. Binance feeding the BSC ecosystem through exchanges and Polygon to gain infrastructure leadership through acquisitions is a good example. Developers have come to realize that the infrastructure is used to serve the application, and by owning users and flow entry you will have the voice of Web3. So, the next cycle, although the infrastructure is not yet able to support one billion users, but it is the dawn moment for app developers to catch the “high ground”.
DeFi
After two cycles of exploration, DeFi’s future exploration may focus on two areas, one is how to attract the customer of the central financial institutions from the inner circle, and the other one is how to attract unbanked users from the outer circle, that is the third world users. After the Luna crash in 2022, the Three Arrows thunderstorm, FTX thunderstorm, DCG and other institutions all triggered a serial stampede event, which made many users question Crypto, believing that this is a world without constraints and rules. Wall Street institutions that promoted the last round of the bull market also became the main cause of the crash due to excessive leverage.
But we can see from the data that DEX trading volume quickly doubled in the days after the FTX thunderstorm, and everyone’s fear of centralized institutions turned into trust in decentralized financial protocols, Therefore, it is not that there are no rules in this industry, but in the Crypto world, only code is the rule, code is the law. We don’t have to trust any centralized organization, instead, we can trust the security of open-source protocols and smart contracts. This is one of DeFi’s narratives for the next round: to replace existing centralized financial institutions. In 2020, DEX trading volume once accounted for 15% of CEX trading volume due to trade mining, yield farming and other incentives. However, after two rounds of decline, there are no longer enough abundant mining token incentives. However, we see that DEX trading volume has rebounded back to 15% recently, which is in line with the development curve of emerging technologies. That is, after the bubble subsided, more and more people began to use DEX as a place for daily transactions, replacing the function of CEX.
Of course, CEX still has the lion’s share of the market, and DEX still has plenty of room to grow. Moreover, this is only the share of the spot trading volume. If we put this number into derivatives, we will find that it is less than 2%, the volume and fees generated by derivatives account for the major profits of many centralized exchanges. To achieve the same derivatives trading experience as CEX, the current decentralized derivatives exchanges are far from enough. Although we see some excellent products like GMX, the response speed, high concurrent processing power, depth, convenience, etc., are still far from the experience brought by centralized exchanges. This also means that most users will not choose DEX to trade derivatives such as futures and options at this stage. So, this is what DeFi needs to address in the next cycle, and this is where a lot of growth is likely to occur, the goal is to seize the users of CEX that are currently in the circle. This requires scaling solutions such as L2, asset cross-chain solutions, account privacy protection, new liquidity solutions and many other areas of exploration.
Another direction for DeFi development is developing in low-financialized third-world countries and getting users under low barriers. Just like when China bypassed the development of credit cards and directly rolled out mobile payment, DeFi may help many third-world countries in Asia, Africa and Latin America to bypass the path of establishing bank accounts, using credit cards and using third-party payments, then directly start using digital currencies for daily payments. Now in some countries in Africa, and South America, shops have started to accept BTC payments, because even though BTC fluctuates a lot, the fiat currencies from these countries are even more fluctuating, plus there are no trustworthy banks, so they are not used to opening bank accounts and saving money, not even to mention the financialization formed by lending. But DeFi can help them build a new financial order where there is no central trust. To achieve such a vision, we should not only rely on the iteration of technology to further lower the threshold, such as the development of AA wallet and smart contract wallet, how to build a credit mechanism purely based on the chain, but also consider how to localize and promote, how we can carry out user education and eventually establishing a localized community.
When DeFi develops into the next cycle, if we want to achieve explosive growth from the two scenarios mentioned above, it may be difficult to solely rely on protocol and liquidity scheme, it will also need to rely on the development of multiple underlying infrastructures in the industry to a great extent, which requires investors and developers to pay more attention to the construction of underlying facility while focusing on the solution of the protocol itself.
X to Earn
In 2021, Axie Infinity brought Play to Earn into everyone’s vision. The combination of the “classical” ERC721 solution, the low-cost pet battle game, and Ponzi’s token economy design, together they broke out into a huge influence and became a national game in several Southeast Asian countries. The game attracted people who may have nothing to do with the crypto world to harvest huge wealth here, and all family members join in this gold-digging business. Earlier this year, the popularity of StepN expanded the boundaries of Earn to “X”, and thanks to its precise numerical design and strong anti-cheating system, millions of people joined the running group. Since then, all kinds of X to Earn programs have poured in, but most of the projects are the same, they only replace the “shoes” with various NFTs, or the running is replaced by eating, sleeping and other daily activities in life, which is not very different from the framework created by StepN. After the crash of StepN, there were lots of discussions about the token economy: what are the pros and cons of Ponzi’s token economy design? How does the reservoir of NFTS change the original economic model? How do Multichain generated tokens weigh the conflicts of interest between new players and old players? Can a similar design be added to any scenario that requires user motivation?
Ponzi’s parlay has been with the cryptocurrency community for many years, and its definition can be large or small, if we look back on the development of the cryptocurrency community over the years, there are some similar examples. Ponzi is the basis for many token economies, but if you try to define it that way before the collapse, you are at the risk of being verbally attacked by the community; accordingly, after its collapse, we do not want to completely deny it, instead, we want to review and reflect on its exploration in the historical development of the token economy. The failure of Fcoin is already the dust in history, but the “trade as mining” it brought laid the foundation for the “yield farming” boom in DeFi Summer two years later.
So, when we talk about X to Earn, we are not trying to define Ponzi, but rather, how can the token economy be tied to user behaviours in the future of Web3 applications? As for decentralized applications or protocols, there are three common token schemes available in the market today:
（1） Governance tokens: this type of token is based on voting rights, which are either directly voted according to holdings, or weighted by time after pledging. Token holders cannot receive project benefits, instead, they need to turn ecological resources brought by governance rights into profits, or rely on future dividend expectations.
（2） Dividend-sharing tokens: Also known as a security token, it uses project proceeds to distribute dividends or repurchase, directly benefiting holders.
（3） Pledged tokens: holding a token can increase the future output, or holders can obtain output based on the share of the pledge, they can also obtain output based on the holdings of other tokens (or NFST) in the ecosystem. We believe that the X to Earn type of model which holds NFT and requires in-app behaviour to obtain token output is a variant of this category.
Unlike the last cycle, in this cycle except for some strong compliance projects, most projects in this cycle have started to integrate multiple types, rather than using a single token with a certain function, or using a dual-token system which is known as governance tokens+ dividend/pledge tokens. Compared to the first two types, pledged tokens focus more on future output, requiring a more precise numerical design of supply and demand. The supply and demand of tokens directly affect the price of tokens, due to the greater output of pledged tokens, the demand is also greater. If the governance right and income distribution right cannot stimulate a large token demand in short term, then, as a result, the native demand in the application is difficult to reach the expected volume, furthermore, a more Ponzi-style design with native tokens as incentives become the ultimate choice. This is the reason why many X to Earn projects have to choose the Ponzi model, and it is the urgent problem to be solved in the next cycle. The key to Ponzi is whether real demand can be stimulated with fake demand and whether it can land softly when facing lengthening payback cycles and diminishing returns.
In our opinion, X to Earn focuses on X, not Earn. Earn helps the projects to get a cold start, build up users early, and solve the “customer acquisition” problem in the growth model. However, the “Earn” is not the only factor in projects, instead, the Ponzi model should be soft-landed quickly after a cold start, undermining the interests of the early users. Because “X” is the key to operating the project continuously, the app itself should generate more user demand and the “retention” of users should be based on user behaviours in the application, not earning more tokens. “Positive Externality” is a term that many developers have been using lately, which emphasizes how the project can attract external incremental revenue to ensure internal revenue capture so that external demand can outweigh internal supply. Lowering the user threshold and attracting flow outside the circle is the consensus of the next cycle, and it is also the only way to transform Web2 to Web3.
In the next cycle, Ponzi’s projects will still exist and surely will earn enough attention and cause a huge market impact when they crash (such as the collapse of Luna that caused a huge impact on the Korean national economy). What you need to remember is:
(1) Nothing is “too big to fail”
(2) What makes you successful can also destroy you easily
Games and Metaverse
Axie Infinity led Play to Earn to success, but that’s not the whole story. From the 2022 financing data disclosed by Planet Daily, “The total financing of GameFi is $5.89 billion throughout 2022”, accounting for the first proportion of all types of financing, and this figure does not include the classification of “metaverse”. Similarly, in the form of our fund’s primary market project library, the number of projects classified by games is 796, accounting for about 20% of the total project library, second only to DeFi.
On the one hand, it benefits from the “metaverse” investment fever caused by Facebook after changing its name to Meta, on the other hand, it benefits from the organic combination of Axie Infinity in NFT and games. The bonus of the two aspects makes investors flock to games, and it is bound to invest in the next hit of the market. However, putting “games” and “metaverse” together does not mean they are the same. On the contrary, we think of them as very different. Perhaps they are all “virtual people” to the old-timers who don’t play games, but we think that games emphasize more on competition or growth more, and the “metaverse” emphasizes the “mapping” of the real world into the virtual world. Most projects that call themselves “metaverse” are technically just MMORPGs, they just call themselves “Web3 games”, and essentially are just a resale of the same old game plus an NFT.
We believe that neither of these schemes is the final game. I want to introduce a story here, when FTX fails, there was news that SBF had been playing Storybook Brawl, a card game they bought by Alameda, but now if you look at the Steam reviews of the game which are all about SBF, telling him not to bring digital currency and other dirty things to the games they love, they just want to play games. These views, published before FTX Thunderstorm, are very different from the accepted view in the industry because they are real game players. These comments reflect that the reason why games make money is that they make people feel happy. Whether it is a Pay to Earn online game, or a competitive Moba and FPS, the original intention is to help people find happiness, and it is to escape from the troubles of the real world, not to be tortured by daytime work and mining gold in the game at night. This is not to say that mining gold or bringing the Token economy is wrong, but the game should serve consumers first, if consumers can be happy here, they will be willing to spend, which will bring “positive externality”, and then the token economy behind it. Web3 can improve things like player ownership of data, quicker cold start with tokens, and using BFT to verify the rarity of equipment or items, etc., but these aren’t fundamental issues. It’s always been about making games fun first and then adding Web3 elements later.
Going back to the original question, what will be the next cycle of the game track? In our view, most of the AAA games that no one else plays, with some Token economy in them, but don’t have a good numerical design and aren’t fun, will fade away in this bear market.
Whether a game is attractive or not always depends on if it is fun enough. The immersion and reality mapping emphasized by the metauniverse along with the Ponzi model and economic benefits brought by NFT and Token economy are mere complements to the gameplay, and the “playability” of the game itself is the real hard power of a game. The Web3 games that will break out in the next cycle should be based on the original Web2 games that are fun enough to attract players and based on positive cash flow with a lightweight Token model that uses tokens as equity to share dividends, rather than being strongly bound to user behaviours. Aside from compliance, compared with stocks, Token has stronger liquidity and can be used as a recharge behaviour incentive for game players. However, players and investors should be divided, so that players who like to be immersed in the virtual world can continue to dream their “hero dream”, and investors who want to get capital benefits do not have to force themselves to play games, but only need to make decisions, then get the benefit. As for whom the data belongs to, 90% of players don’t care. What good would it do if Blizzard pulled out from China market and gave all the data back to the players? It’s just an urn to remember, and if you have a choice, all you want is to keep playing.
The game industry is divided into three categories: infrastructure, distribution platform, and the game itself. While focusing on the game, we are also focusing on the building of the game infrastructure, which is closer to the concept of the metaverse, because they are more concerned with creating a new way of interaction than creating a game, allowing people’s minds to expand in dimensions that did not exist before. Over the past year, we’ve invested in infrastructure projects such as Fragcolor, which provides a native blockchain game development engine, Anima, which builds on-chain AR interactions, Matrix World, and ChapterX, which provides multi-chain metaverse solutions. Metaverse projects such as SecondLive have accumulated hundreds of thousands of users. Decentraland and Sandbox are sandbox games in the name of metauniverse. A virtual land link alone will not attract the consensus of the majority of players. What will change the world is the products that bring us new and imaginative experiences. We know that the current physical infrastructure and technology are far from the VR/AR worlds depicted in Ready Player One and Out of Control, but Web3 should have a place in the new virtual world of the future.
NFTFi
While DeFi and GameFi are still discussing the feasibility of the agreement and the token economy model, NFT has already opened a gap in the cultural market with PFP. The identity and cultural transmission brought by PFP has formed a huge influence around the world, and also formed a huge consensus in the circle. In the past two years, chatting with a PFP profile picture of the blue-chip like BAYC/Punk is like touching a Rolex in your hand while having coffee with someone. However, the PFP summer never came back, and the lack of liquidity in the NFT market was highlighted by the precipitous drop in Opensea trading volumes in June 2022. An AMM DEX-like solution to the long tail market of NFT is urgently needed when people discovered that the lack of liquidity in the down cycle of PFP avatars other than blue chips lead to a rapid price decline. The exploration for NFT liquidity solutions has never stopped in this cycle, but Opensea’s order-book model has dominated the market.
We can see the clear market needs, but it is always difficult to find an effective solution. After Opensea’s rise and rapid market dominance, NFT MarketPlace competition focused on royalty and profit distribution, such as LooksRara and X2Y2. The emergence of Blurry.io has further optimized the transaction experience by integrating aggregate purchases and trading data and other features, which forced Opensea to make changes, but still didn’t solve the fundamental problem. Sudoswap tried to take advantage of AMM, but the split-pool liquidity design reduced the total liquidity, and the high barriers and complex design put off many people. Fractional and NFTX fragmentation solutions seem to solve the problem by converting non-homogeneous tokens into homogeneous tokens, but after the launch of APE, the investors realized that those who participate in tokens and those who participate in NFT are two different groups of people, and the noble blue chip disintegrated its social attributes after fragmentation, which is not as easy as issuing tokens directly.
Once again, NFT’s liquidity solution needs to meet the demands of the long-tail market. It is difficult to produce greater value by simply focusing on every small flow-lacking picture. However, with the increasingly segmented NFT market, it is still necessary to solve the liquidity problem in the markets outside of PFP, such as games, music and art. The current order-book model is not enough to sustain the market operation.
Wallet
Although the trend of the EOA wallet and the AA wallet is irreversible, other wallets will not just stop here, the MPC wallet development is in full swing, and the pattern may have been formed before the EIP4337 landing, new is the golden time to seize the market. There are two possible paths for wallets, the first one is to start from the application and develop users in reverse to form an application-oriented ecosystem and keep users in the ecosystem. Another one is to start from the B-end service, providing SDK which allows more applications to access the wallet system, then rapidly developing their own customer base, a network effect can be formed once you have large user numbers, and finally, the value of cluster can be extracted.
Data tools
With the rapid development of decentralized applications, the value of on-chain data is further reflected. Nansen and Dune Analyst become the tools that many analysts use on a daily basis, over the past year we have seen a lot of data products from on-chain data indexing to integrated airdrop and Mint calendars.
The essence of the tool is still exchanging rate flow, which is divided into two steps. The first step is to occupy the market in the segmented field, and the second part is to expand to other fields rapidly and then become the flow aggregation spot. Bytedance’s core competitive advantage is not TikTok, but its recommendation algorithm and user traffic, with this scheme, they can copy hundreds of similar products to get a great share in the market segment. The same goes for data tools, and the development team needs to consider what the core advantage is behind the back, whether it is strong data mining or the breadth of on-chain tag collection.
We invested in Footprint Network, which initially focused on building data analysis specifically for DeFi, but after deep analysis of market needs and their strengths, they switched to GameFi and became the most influential Web3 game data analytic tool in the world. You can see the real-time comprehensive game on-chain data, and monitor the content you want to follow in real-time with just one click.
However, the business model for data analytic tools has always been a difficult problem to solve, we see this problem from the short lifespan of a large amount of data analytic tools. ToB or ToC, that’s a question. Once the on-chain protocol is deployed, there is little room for change, but analytics tools don’t have to constantly iterate and spend a lot on server costs compared to the objects which they analyze. Nansen was the first to try C-end charging through a high unit price model, which relied on their ability to help users gain profit through the information gap. But when the bull market ended and the bear market hit, everyone was losing money, the losses from “merchandising” far exceeded even the cost of user membership, and user activity fell off the cliff. Products like Massari and Theblock which combine media and data analysis can have a voice to build media influences in the industry due to their data analysis capability. They are more like ToB products which continuously output industry reports while strengthening themselves through partners and resources and then obtaining profits. The advertisement is also a good business model, but it requires a large number of users and access rates, CoinMarketCap and Coingecko can be used as a reference in this point. when it comes to data analytic tools, we prefer small and beautiful products that might only need to solve a single need at first, but once you’ve built this niche, the other areas can be expanded upon. DeFiLlama moved into DEX aggregation after a year of deep ploughing with TVL, and it wouldn’t be a surprise to see the news that they are working on the public chain.
Socializing
Socializing is a huge topic, when we talk about it, we need to define what Web3 socializing is. The modern social network is everywhere in our life, such as instant messages to communicate with people, social media for expressing ideas, and video websites that can show everything in life are all socializing content. You can imagine if these all happen on the chain, but the current infrastructure obviously cannot accommodate this, so if we just change the link of profit distribution and let the existing Web2 socializing platforms start issuing tokens, then are they Web3 socializing?
We do not want to presuppose the product forms of Web3 socializing, we only discuss several aspects: data ownership, the volume of data on the chain, and the value generated by the data. The progression of these aspects means that socializing is moving from Web2 to Web3.
Data ownership is the sign to define whether socializing is happening on Web3. If Twitter-issued digital currency (or the DOGE coin) can be used to make donations or the advertisers use it to pay ad fees, we can think of this as Twitter is trying to make a digital transformation, but this is not Web3 socializing. The reason is that all content on Twitter is still stored in a centralized server, and censors also have the right to block a user’s account without the user’s permission. So, if we have to define what Web3 is, we believe that socializing data should exist on the blockchain, where the users have absolute control over the account data. This is part of the socializing infrastructure that top teams in the industry are trying to build, all the platforms including Nostr based on Bitcoin’s Lightening network, Farcater based on Ethereum and Lens Protocol based on Polygon are trying to recreate a set of data rules, which will build socializing protocol on a mature blockchain to achieve decentralization and censorship resistance. The content generated based on these protocols is also blockchain-based, while the data and account ownership belong to the users themselves. On top of these protocols, the community has developed some front-ends that can help users make better use of these protocols. We believe this is the beginning of Web3 socializing.
After data ownership is established, Web3 will need a large amount of data to build a moat. If we look back at the evolution of Bitcoin, “consensus” has been an important factor in its survival over the years, it is also the biggest advantage of BTC compared to other fork coins with the same code. After obtaining the cornerstone of technology, the key to Web3 socializing is to expand users and consensus rapidly. At this moment, tokens may play an important role as a way to motivate users or help to build a better business model for applications. Building the front end is also a crucial part to get users. If you test a product front-end built on top of Nostr or Lens Protocol, you will find that they are too young compared to the mature Web2 products. This is only a matter of time, the infrastructure is still under the construction process, after showing the initial competition pattern, the competition point to seize users will be shifted to the entrance end, at the time, no matter if it is the game, exchange or wallet, all will become the entrance for socializing. In addition, because of the interoperability of the protocol and user-owned account, application switching will become easier and competition will be more intense. Application portals that are not compatible with other socializing protocols will be abandoned by users.
After obtaining a large number of data, how to conduct mining and generate values will be the most valuable topic in the post-Web3 era. The Web2 data value is primarily reflected in targeted advertising. It’s hard to give a prediction on what Web3 value will be at this moment, but there is no doubt that it will lead to the products of several trillion-level.
Back to the original question, what is Web3 socializing? We can only describe what Web3 will bring us today and what kind of things there will be, it is difficult to give a precise definition. However, we do know for certain that Web3 socializing is still in the stage of building infrastructures, and the chance of success in investing in infrastructure is much higher than in finding client products.
AI
ChatGPT’s popularity has brought the combination of AI and Crypto back into people’s vision. Most AI+Blockchain projects in the industry focus on using AI to solve the data privacy and security issues of the blockchain, rather than application layer products.
It’s difficult to predict how AI and Crypto will combine in the future, but there are a number of potential cases and applications currently being developed or discussed.
One area where AI and Crypto could be combined is DeFi and financial trading. AI algorithms could be used to analyze market trends and trade based on this information, potentially leading to more efficient and profitable trading. In addition, AI could be used to detect fraud in DeFi systems and help maintain the security of these decentralized networks.
Another potential use case for AI and Crypto is the creation of decentralized autonomous organizations (DAOs). Daos are organizations managed by computer programs encoded on a blockchain. AI can be used to optimize and manage these organizations, making decision-making and governance more efficient.
There are some interesting developments in the area of privacy and data security as well. AI algorithms are often trained on large amounts of data, which can include sensitive personal information. Blockchain technology can secure this data to ensure that it is only used for its intended purpose. This is very important in areas such as healthcare and finance, where privacy is crucial.
There are already several projects exploring the integration of AI and Crypto. Ocean Protocol, for example, is a blockchain-powered data exchange platform designed to provide a secure and trusted environment for exchanging valuable data and to support the development and deployment of AI algorithms.
The development of AI technology and the popularity of Crypto is also driving the development of smart contracts. AI algorithms can be used to develop and execute these smart contracts to ensure that they operate in a safe and secure manner.
In summary, integrating AI and Crypto will likely lead to a series of new applications and a more efficient, secure and trusted financial system. As these technologies continue to develop and evolve, there will be many more interesting applications and developments.
If AIs were to trade with each other, would they do so in fiat or digital currency? I asked ChatGPT this question and it replied that quantified pricing of data access with Tokens is a better solution compared to traditional currencies.
This means that the combination of digital currency and AI may be purer, it merely serves as a unit of account for future AI interactions to help AIGC products to gain users.
Epilogue
Observing across all the tracks, we look ahead to the scenarios that may generate a massive user boom in the next cycle. Back to the initial discussion, when the next bull market comes, applications may not only be part of the public blockchain ecosystem, but instead, this is where the giant applications start to stand on their own, and unlike the monopoly war of Web2, the emphasis on interoperability and composability will come into play. We are looking forward to a world where users own their data, move between apps at an extremely low cost, socialize freely, game freely and don’t have to worry about the high barrier, fees, or the security of their assets. In this way, Web3 will certainly be able to carry many good wishes of people, people will also spend more time on the internet and metaverse, in this virtual world many ideas can be realized. At this point, Web3 will burst out incomparable value.
Website: https://arkstream.capital
Twitter: https://twitter.com/ark_stream
Twitter: https://twitter.com/Block_Ark
