NFT mania may just be the beginning

Everything in the NFT field is developing too fast, but what if this is just the beginning?

NFT mania may just be the beginning

First of all, a word from our sponsor…

It is easy for us to look back on the past 10 years with hindsight and thinking-what are they thinking?

  • Google+ goes online and kills Facebook
  • Netflix split “Qwikster” (the stock price fell from $300 to $70)
  • Rebecca Black (American young female pop singer) released “Friday”

The same situation applies to what happened today:

  • A digital horse start-up company raised $20 million in financing
  • The third richest person in the world tweeted that Dogecoin is money
  • Bennifer 2.0

But sometimes madness is a good thing. Just ask early ETH and BTC holders to understand: a little risk and a little madness can turn thousands of dollars into millions.

However, not everything has to go crazy. I balance some of the skyrocketing parts of my portfolio with conservative investments with long-term stable returns. I’m not talking about bonds or funds with maturity dates. I’m talking about an asset class that will grow by more than $1 trillion in the next five years.

The price of a real asset has increased by 14% annually from 1995 to 2020, which is almost twice the rate of return of real estate and gold, and the correlation between real estate and gold and stocks is almost zero.

The real asset I mentioned above is contemporary art. A start-up company is revolutionizing this white-hot market. They segment millions of dollars worth of works by artists such as Banks and Monet so that everyone can get a share of the pie. I invested in eight of their products and plan to add more investments.

You can skip their waiting list and join a unique community to invest in contemporary art.

Hi friends?

Happy Monday!

The world is getting crazy. This article tries to understand everything about madness. There may be a lot of doubts about this. If you have read “Not Boring”, then this article may not be as you wish. I will stand on the other side of the perspective: what if this is just the beginning?

If things get crazier and crazier, it’s helpful to be prepared for it.
let’s start.

Understand the power of compound

The situation outside looks crazy right now, right? The money of various investment institutions is frantically looking for good targets, and billionaires are flying away from the earth.

The following are some crazy things that happened in July, and the degree of craziness is generally on the rise:

  • Tiger Global has just deployed a $6.7 billion venture fund in three months.
  • Gary Vaynerchuk bought a CryptoPunk for $3.7 million. This was the second highest price of the day.
  • Axis Infinity’s revenue in July exceeded US$190 million, a year-on-year increase of 16 times.
  • Mark Zuckerberg and his company mentioned “Metaverse” 20 times on Facebook’s earnings conference call.
  • The three-year-old cryptocurrency exchange FTX has a valuation of US$18 billion.
  • Richard Branson flew to space on July 11. On July 20th, Jeff Bezos went to space.
  • LVMH Group Chairman and CEO Bernard Arnault surpassed Bezos to become the world’s richest man.
  • Last week, physicists used Google’s quantum computer to create a time crystal and demonstrated a new phase of matter.
  • In the same week, scientists designed the mirror image of DNA polymerase, opening the possibility of “mirror life”.

Julia Lipton of Awesome People captured this very well:

NFT mania may just be the beginning

The world began to look like “Ready Player One”, faster than I thought…

What happened in July 10 years ago made this year very crazy. Now, this feels like a normal July. And everything is accelerating, and it feels like science fiction.

NFT mania may just be the beginning

The only way to not be completely confused by what is happening now is to read more science fiction.

The madness and high valuation of NFT has attracted a lot of ridicule from the outside world. This is a common way for people to react to strange things. It is very easy for people to regard everything as bubbles, or temporary bubbles, or think that these are Ponzi schemes that people are tired of the new crown virus and seek risks or are waiting to collapse. Being skeptical will make you look smarter and more responsible. One way to definitely add points to adults is to make fun of those who believe “this time is different.”

But this time is always different. When we stretch the timeline and ignore cycles and fluctuations, history looks like a huge exponential curve.

When you pull the long time line, a different perspective appears. If you read the hundreds of thousands of words I wrote in Not Boring, you can only learn one concept from it, that is:

The world will continue to become crazier exponentially.

Those futuristic things that seem unusual today will appear weird and outdated in ten years. Newsworthy events today will become commonplace events in the future. What the opponents oppose in 2031 is almost unimaginable from today’s perspective. We have evolved to predict (and survive) future events by looking back at past experiences. But as the pace of progress has accelerated, the effective duration of our past experience has shortened.

This article is a series of recent attempts to understand what is happening in a distinctive and serious way. I am a firm optimist, but I want to try to build more frameworks and reasons based on optimism.

Like Dreams All the Way Up, it is also one of the articles in which I think that maybe the evaluation will decline in the short term and will be criticized. This is good, this article is not a short-term forecast. I have no ability to predict the future. Everything in the world is always changing rapidly. We are now likely to be at the high point of the local market.

Optimists seem to be more lazy intellectually than pessimists, but optimists are increasingly justified.

NFT mania may just be the beginning

The pessimist sounds smart. But it is the optimists who make money.

I don’t think this is just a bull market statement. Looking back in the past may be more important than imagining the future. So, open up and let us be prepared. We will discuss:

  • Die Progress Unit and Law of Accelarating Return
  • Venture Capital Rorschach Ink Test and the $320 trillion global stock market
  • Composite Colossus
  • How to survive the madness

Die Progress Unit and Law of Accelarating Return

In 2015, Tim Urban wrote a two-part series on artificial intelligence (AI) on his popular blog “Wait But Why”. Because this article contains some pretty crazy ideas, Urban uses a 2,000-word preface to explain to his readers why they shouldn’t consider what he’s about to write too science fiction or futuristic.

Urban’s main point is that human progress is exponential. However, for now, it is difficult for people to realize or understand that this chart is about to go vertical.

NFT mania may just be the beginning

Source: WaitButWhy

Urban explained: “You have to remember what it feels like to stand on the time chart: you can’t see what is on your right.” We can look back to the past with relative certainty; but looking forward to the future is impossible with any certainty. Especially when progress itself is growing at an ever faster rate.

To illustrate this point, Urban wrote a thought experiment:

Imagine you take a time machine back to 1750, capture a living person, and then take him back to the present, take him around and see his reaction. Everything we take for granted-cars, tall buildings, iPhones, live sports, recorded music, Google Maps-will shock him in such a terrible way, he may really be scared to death.

If that person wants to continue this game, take people from the past to 1750 and then be scared to death, then he cannot go back to 250 years ago and arrest people from 1500. Because 1750 and 1500 are too similar. Maybe there will be something new in 1750, but this is not enough to shock people in the 16th century. In order to achieve the same effect, Urban guessed that he had to find someone who lived around 12,000 BC, before the first agricultural revolution. Similarly, people in 1500 should not go back to between 12,000 and 24,000 BC. “He must go back more than 100,000 years ago and find someone who can show him fire and language for the first time.”

He called the time when people were shocked and scared to death in the future world as “Death Process Unit” (DPU). DPU vividly interprets the views of futurist Ray Cruzwell, the author of “The Singularity Is Near: The Law of Accelerated Return”.

The law of accelerated returns states that the speed of progress is accelerated because humans can use the technology they have to make progress faster than previous generations without technology.

From the perspective of DPU or actual figures, this is true, but according to Urban, we cannot understand the impact of exponential progress for three reasons:

1. When people talk about history, we always think in a straight line. It’s hard to imagine how crazy the future will become, because most people make inferences based on past growth rates, and even those who are more optimistic and adventurous will make inferences based on current growth rates.

NFT mania may just be the beginning

Source: WaitButWhy

If you admit that the rate of progress is accelerating, then it is not enough to use past or even current rates to speculate about the future.

2. The development trajectory of modern history is often distorted. What’s more difficult is that in the short term, assuming that economic growth accelerates may make you look stupid or even lose money. The whole process was not smooth. A period of rapid growth may give way to a period of slow growth. Progress occurs in the S-curve (similar to the Gartner hype cycle we often talk about here), and it may even look like we are going backwards in some ways. But over time, if you stretch the timeline, these are just skewed curves on the exponential curve.

NFT mania may just be the beginning

Source: WaitButWhy

3. Our own experience makes us old people who hold a stubborn view of the future. We have experienced past growth, but we have never experienced future growth. Therefore, it is easier for us to intuitively understand what the future will look like through linear inference based on our actual experience. But things in the future will have a different development trajectory. We believe that anything that deviates too far from our past experience or historical average will return to average.

We are making progress, and it is progressing faster and faster, but how did this happen?

Two years later, in a 2017 article entitled “Neural Connections and the Miraculous Future of the Brain”, Urban introduced another useful analogy: the Human Colossus. We have evolved from cells to humans who can produce a large number of books and share them all over the world. At that time, humans became human colossus, essentially a large organism with shared knowledge. Computers and the Internet have made knowledge (and tools) sharing more powerful, so that today, you can connect with anyone online, download almost any information, and even fork a complete code base or download design drawings.

NFT mania may just be the beginning

Source: WaitButWhy

By connecting to the Internet, anyone can obtain all human knowledge. What people have developed in thousands, centuries or even years can be used and mixed by one person in a second. We have more building blocks than ever before, and we can use these building blocks to build new buildings faster.

The conclusion here is that human knowledge is complex. We build new things faster and faster on the shoulders of giants, but our brains are not good at understanding all these things in the present.

If you stop, you can feel it happening around us, right now.

Venture Capital Rorschach Ink Test and a $320 trillion global market

There are many new and incomprehensible things happening at the same time. In order to make it easier for everyone to understand this process, let us start with a familiar and quantifiable place: venture capital.

This chart has attracted the attention of venture capital and entrepreneurial circles in the past few weeks. It shows the total amount of US venture capital activity in the past 10 years.

NFT mania may just be the beginning

Source: Pitchbook-NVCA Venture Monitor

American venture capitalists will invest more in 2020 than in any previous year: $164 billion. By 2021, they have invested 91% of it, or 150 billion U.S. dollars, and invested 75 billion U.S. dollars and 75 billion U.S. dollars in the first quarter and the second quarter, respectively. This is only half a year’s investment amount. If they persist, venture capital will invest $300 billion in start-ups in 2021, which is 83% more than in any previous year.

The financing table is a Rorschach test.

If you think we are experiencing an anomaly caused by the Tiger Global Fund and the new crown virus, maybe your brain will predict something like this:

NFT mania may just be the beginning

The venture capital you get will increase. But now the investment environment is very hot. From 2011 to 2020, our compound annual growth rate has reached 15.4% (we do not consider 2021 for the time being, this is a strange year, it may return to the mean).

If you followed the DPU/Accelerated Regression Law point of view, you might see something very different:

NFT mania may just be the beginning

I am not a blind optimist! The market will definitely be down for a few years! But if the curve is exponential rather than linear (both Kurzweil and Urban thinks it will be like this), it will be like this. In fact, even I am too conservative. If I draw the curve based on the 20.8% compound annual growth rate from 2011 to 2021, then by 2031, our market size will reach 1.9 trillion US dollars, which is twice the size of the last bar chart above, and this is investment Without the premise of accelerating growth in scale. It is very difficult to imagine accelerating growth, even for people born like me who are very optimistic.

Even Tiger Global, the world’s fastest-growing venture capital investor, can hardly do this. The Financial Times reported last week that the Tiger Fund raised $6.7 billion in funds in March, most of which had already been in place in June. $6.7 billion in 3 months! According to the British “Financial Times” report:

In June of this year, the company stated in a letter to investors that it “has always underestimated” the market for private technology companies. Six months ago, data showed that there was a $3 trillion market opportunity. The company said it is now close to $5 trillion.

Although this is obviously a selfish act: Tiger Global Fund needs to explain why it ran out of investors’ money so quickly and why investors should give it another $10 billion, but it is also very enlightening. If Tiger Global Fund has always underestimated the potential of the market, then the rest of us may have also far underestimated the potential of the market.

Judging from the competition-based reasons emphasized by Eftrand in “Playing Different games”, Tiger Global Fund’s rapid deployment strategy may be correct, because they may have discovered the permanent acceleration of the market earlier than others. . If this trend is still in its infancy, you should invest as much as possible in fast-growing companies.

In other words, it is a huge leap from 300 billion US dollars a year now to 2 trillion US dollars a year 10 years from now. Especially because the money needs to generate returns.

NFT mania may just be the beginning

Source: Correlation Ventures

According to my very rough estimate from this risk investment return distribution chart (take the midpoint of the interval, assuming that the return rate of 0.5% of the fund is> 20 times, that is, 30 times), we can get the average of US venture capital funds Cash return rate: 2.13 times. This means that in order to generate an average return rate of US$2 trillion in history, start-ups worth about US$4.25 trillion need to be created each year. This seems unbelievable, because as I wrote in a memo from Not Boring Capital, the value of all unicorn companies in the world today is only $2.37 trillion.

This information is now out of date. Since July 12, 29 new unicorn companies have been born, and the total market value of all 779 companies is 2.485 trillion U.S. dollars, slightly higher than Apple’s 2.41 trillion U.S. dollar market value.

NFT mania may just be the beginning

In any case, this means that every year, the value of unicorns we need to create is almost twice the value of unicorns in the world today. This is not just on paper, we also need a real export! When you look at the size of the entire market today, this seems incredible.

The total market value of all listed stocks worldwide is approximately US$117 trillion. Among them, the S&P 500 has a market capitalization of 36 trillion U.S. dollars, and the Nasdaq 100 has a market capitalization of 20 trillion U.S. dollars (there is overlap between the two: Apple is one of the two indexes The company with the largest market capitalization). This will mean that, over time, the value of venture-backed companies in just five years will need to exceed the current value of the 100 companies in the Nasdaq index. This is getting more and more incredible!

But the market is not static. According to data from the World Bank and Sibil Research, the total market value of all listed companies in the world has grown from US$1.138 trillion in 1975 to US$117 trillion today, an increase of approximately 100 times, and the compound annual growth rate in 46 years is 10.6%. .

NFT mania may just be the beginning

Source: World Bank

Take a look at this beautiful animation I made above, which shows the once-in-a-decade growth in the market value of global listed stocks. At the end of each decade, looking back, this chart looks very steep, as if it cannot continue to rise. Then, when you see this chart, you must keep this in mind. It predicts that the compound annual growth rate of the global listed stock market value in the next 10 years will also be 10.6%.

NFT mania may just be the beginning

According to this prediction, in the next 10 years, the market value of listed stocks will reach 203 trillion US dollars, which is almost twice the total market value of today based on the newly generated value.

Look at the Nasdaq index, which is dominated by technology stocks, and you can do the same.

NFT mania may just be the beginning

Source: MacroTrends + Not Boring Projections

The 100 largest technology stocks in the United States alone are worth US$20 trillion. Calculated at a compound annual growth rate of 10.5%, this figure will increase to $54 trillion in 10 years. It should be noted that Nasdaq does not even include some of the world’s largest technology companies, including Chinese giants Tencent and Alibaba.

Both of these forecasts are more stable than the actual situation in the future. But this may not be the case. If history is a guide, in 10 years, we will see a market full of numbers that are much higher than we can reasonably understand now. Some of the new market value will come from today’s public companies, some will come from today’s private unicorns, some will come from existing startups that have not yet become unicorns, and some will come from companies that don’t even exist. It is impossible to predict what kind of combination it will be.

But what is surprising is that this is where the current US$300 billion venture capital is invested-companies investing today may not be listed in the next 10 years. Assuming that the $2 trillion in funding in 2031 will require a return of $4.25 trillion per year, this will continue into the next decade. By 2041, with the same compound annual growth rate, the value of global listed stocks will reach US$877 trillion, of which US$147 trillion will come from Nasdaq.

This is simply crazy, all of this is just based on entering a few x*(1+10.5%)^10 in the spreadsheet! this is very simple. You can make the spreadsheet display any information. How can we create all these values ​​in 20 years?

To make all of this believable, we need to return to innovation itself, and for this, we need to return to the topic of human colossus.

Composite Colossus

Numbers can be easily compounded. Although it is difficult for people to clearly capture how innovation is synthesized, it does.

I won’t explain this idea better than Tim, so let’s go back to “Human Colossus”:

If the core motivation of individual human beings is to pass on genes, which allows species to continue, then the power of macroeconomics makes the core motivation of human colossus to create value, which means that it tends to invent newer and better technologies. Every time it does this, it becomes a better inventor, which means it can invent new things faster.

Human beings have been building primitive things for the next generation of builders all their lives. Every new invention is the product of centuries of innovation, and then it becomes a simple and neat input for the next invention. Just like a good API, every new invention abstracts all the complexity of its creation.

Let’s use tires as a relatively simple example. In the 4th century BC, Mesopotamia invented the wheel. As early as 1600 BC, ancient South and Central America used rubber to make rubber balls for games. In 1844, Charles Goodyear invented vulcanized rubber. In 1847, Robert Thompson applied for a patent for pneumatic rubber tires. In 1888, Irishman John Boyd Dunlop successfully commercialized the first pneumatic tire. 120 years later, in 2008, the Tesla team took an evolutionary version of this tire as part of the many accessories of the car, each of which has its own long and tortuous evolutionary process, and finally made the first sports car. The Tesla team does not need to reinvent the tire.

NFT mania may just be the beginning

The same compounding process can be seen everywhere in the economy. Each invention is the latest result of a series of compound innovations.

The time crystal mentioned above is only because of Paul Benioff’s idea of ​​Turing machine derivatives in 1980, which led to the concept of quantum computer. It can be traced back to the concept of computer proposed by Charles Babbage in 1834, and then Lost Alamos physicists created the first simple prototype in 1998, and Google developed the Sycamore quantum computer in 2016. At that time, it did not consider its real purpose. Physicists brought it to create The idea of ​​time crystals itself stems from its long physics origin. Now that we have functioning quantum computers and time crystals, a new generation of inventors can use them as input for new and crazier things.

This simplistic diagram is also correct: the hard work of previous generations has made it easier to create new content.

NFT mania may just be the beginning

This is why the pace of innovation continues to accelerate. Discovery becomes an invention, becomes a cornerstone, becomes an invention, becomes a cornerstone, and so on.

Let’s look at financial technology. In the venture capital boom, financial technology stands out. According to data from Pitchbook (via The Economist), in the second quarter alone, venture capital invested $34 billion in financial technology companies, accounting for 45% of the total investment of $75 billion. This makes sense. The Economist pointed out that by 2021, they have made $70 billion from the withdrawal of financial technology.

NFT mania may just be the beginning

Source: “The Economist”

We discussed numbers in the previous section. This part is not about “what”. It’s about “why”.

Fintech is obviously the early beneficiary of compound innovation. Stripe, which was founded in 2009 and valued at US$95 billion, and Plaid, which was founded in 2013, and valued at US$13.4 billion, has established many infrastructures. A new wave of financial technology companies can build on these infrastructures more easily.

  • Robin Hood does not need to connect directly to your bank to withdraw money; it connects through Plaid.
  • Jeremy Smith, one of Equi’s co-founders, told me that it would be impossible for them to develop their own products without fintech infrastructure products such as Plaid and Modern Treasury.
  • Ramp uses Stripe’s Issuing product to create and manage cards.

At the same time, entrepreneurs continue to build more infrastructure. Last week, I spoke with two companies that develop card products on Lithic. Portfolio companies Unit and Embedded allow other companies to add banking and transaction services to their products.

Fintech infrastructure companies can create huge financial results for their investors and enable the next wave of companies to create products that were previously impossible or at least very difficult, expensive, time-consuming, and imperfect. They affect compound innovation.

I once wrote about the impact of off-the-shelf software on the development and speed of new companies:

Redpoint venture capitalist Logan Bartlett once guessed that just 10 years ago, even a great company would take seven or eight years to build what Ramp did in two years. Ramp’s team has less than 100 people. Of course, compared with similar companies in the past, Ramp is now more valuable and growing faster.

API-first companies let other companies focus on their core differences instead of reinventing the wheel. Young companies can become bigger and faster than before. You know what to do.

I haven’t written about it before, or what I didn’t think about until recently is that being able to build faster with fewer employees will have a compounding effect in itself.

First, the faster a new company is established, the faster other companies can benefit from it. New primitives create new innovation opportunities. This is very obvious.

The fact that people rarely explore is that a new company needs fewer employees because it can outsource all functions to APIs and software, so more talented employees will be freed to create their own cause. If 100 employees were needed to create a product that satisfies customers, now only 10 employees are needed, and these 90 additional employees can create 9 more companies.

NFT mania may just be the beginning

Even better, because the 90 employees in the only company will have been working on non-core tasks such as payment, bank integration authentication, scheduling, background checks, data labeling, etc., and these tasks can now be done by inserting APIs, It frees up talent that can be used for innovation, not execution.

In Andy Weir’s latest masterpiece “The Happiness Mary Project”, a character named Strath described the past as a “relentless mystery”. He said:

In 50,000 years, until the Industrial Revolution, human civilization was only about one thing: food. Every existing culture devotes most of its time, energy, manpower, and resources to food.

Agricultural mechanization allows humans to focus on other things. Therefore, technology has developed rapidly in the past few centuries. I’m not comparing APIs to food, but a similar dynamic process is also at work: people can invent new things when they don’t have to pay attention to daily survival issues.

Back to our ten small companies. Not only can they create new things on their own, some of these 10 companies can also provide the cornerstone for creating new companies. Perhaps their innovation will help reduce the required team size from 10 to 5, thereby unleashing more innovative power, and so on.

It also creates 10 times the number of companies that investors can support and 10 times the chance of achieving significant results without reducing the potential scale of any given result. Unless these companies directly compete with almost identical products, they may gain share from existing companies that are less technologically focused, expand the market, or create entirely new markets. Lightweight teams also reduce the cost of failure, allowing people to test ideas faster before they go all out.

  • Building the cornerstone allows more new companies to be built faster and leaner.
  • Faster and leaner companies will build more new components.
  • Compound process.

This concept of composite construction also promotes innovation beyond financial technology. For those categories that seemed unattainable or like pure science fiction ten years ago, the infrastructure now makes architecture relatively simple.

The most obvious is that in the field of cryptocurrency, smart contracts are literally called “Lego” due to their composability. Everything is essentially open source, and new builders can use existing Lego to create exponentially more complex products. We have discussed a lot of cryptocurrencies here recently, you may know how much impact I think it will have, but if you don’t know, please read the related article.

NexHealth’s mission is to accelerate the healthcare process by connecting patients, doctors and developers. They want to make manufacturing health technology products as easy as creating financial technology or cryptocurrency products today. When new primitives make it easier to build new solutions, trillions of dollars in value in the healthcare sector are waiting to be released.

NFT mania may just be the beginning

Scale is building artificial intelligence and machine learning infrastructure, hoping to increase the use of artificial intelligence and machine learning in enterprises from the current 8% to all enterprises in the next 20 years.

NFT mania may just be the beginning

It is almost impossible to predict what impact the widespread use of artificial intelligence and machine learning will have in the coming decades, especially when they are developing so rapidly. I previously cited a two-part article by Tim Urban, “Wait, but why? “, because in his words, “I quickly realized that what is happening in the artificial intelligence world is not only an important topic, but also by far the most important topic for our future.” The potential compound impact of artificial intelligence This is why Kurzweil was initially excited about the law of accelerated returns.

In addition to the above areas, the space infrastructure has also reached such a level: You can log on to SpaceX.com and reserve a location for your satellite on the rocket, which is easier than buying a lot of old-fashioned B2B software service platforms. Seriously, I suggest you click on the link and experience it for yourself.

NFT mania may just be the beginning

Source: SpaceX

Of course, this field also has compounding effects. Varda is putting together a set of commercial space products, just like a software company connecting APIs. The purpose is to build a space factory to make things that were previously impossible on Earth.

SpaceX itself is also using its launch and reentry capabilities to send satellites into space. Through its Starlink business, these satellites will cover the world through fast Internet at a price of $100 per month. Akash Systems will do better on Starlink. It will provide fast internet around the world at a price of $5 per month, thanks to its patented technology of using artificial diamonds to dissipate heat, thereby reducing the size and cost of the satellites required. .

These are absolutely amazing achievements. Only the comprehensive knowledge and innovation of the human colossus can be realized, but they are also the cornerstone of more innovations in the future.

  • What will the world look like when everyone on the planet can access the high-speed Internet for only $5 a month?
  • What will it look like when you allow billions of people to access the Internet from anywhere, artificial intelligence, healthcare, encryption, and financial tool infrastructure, all of which can be called in a few lines of code?
  • What happens when you combine cheap, abundant Internet access with tools like Replit?

All innovations are completed through a composite process. Everything is becoming more and more crazy, faster and faster.

Even without considering the cheap, fast Internet around the world, regions such as Africa, Southeast Asia, and India will experience tremendous growth in the coming decades, creating new innovators and adding billions of global middle classes. In the next few decades, the development of digitization, remote work and cryptocurrency will break national boundaries and make the global competitive environment fairer.

I haven’t been in contact with the meta universe yet. In his “Introduction to the Metaverse”, Matthew Bauer talked about all the different innovations needed to splice the metaverse together. Each innovation is the result of a long series of small and complex innovations. Once the meta-universe becomes a reality, the next huge platform will be transformed (Facebook certainly believes this will happen). What kind of madness will this trigger? What does the value chain look like when you mainly deal with digital products?

What if you combine it with cryptocurrency? The rise of games such as Axis and the crazy demand for NFT show that there is a real need for digital employment and identity. Bernard Arnault’s top spot on the “Forbes” rich list proves that people are willing to spend money to show off; it happened during the recent NFT revival. People always want to express themselves and show off. NFT and Meta Universe have opened up new venues for experimentation and identity seeking, and it has little impact on production costs or the environment.

This process is not linear. This is exponential and completely unpredictable. We have only introduced a small part of the countless innovations, and these innovations themselves will give birth to new innovations. It is impossible to simulate the results of the arrangement and interaction between the fields we have introduced. Ten years ago, cryptocurrencies almost did not exist. In the next ten years, what new categories will emerge that exceed our expected capabilities?

All of this is saying: I know things look weird right now, but when you look at it right on the chart, this is just a small bright spot.

How to survive the madness

The problem is: Although the game may continue to develop, it does not mean that the game has obvious or simple gameplay.

First, there is a timing risk.

If the Fed raises interest rates, growth assets may suffer in the short term. Clumsy cryptocurrency regulation is a legitimate concern. The market will never rise in a straight line. Although the compound annual growth rate of the global stock market and the Nasdaq Composite Index is about 10.5% and eventually rises, there are still many ups and downs along the way. Please do not mortgage your house and YOLO as risky assets. You need to play a role in the game.

Second, there are macro and tail risks.

If the US dollar loses its status as a global reserve currency, what will happen to the market? The threat of climate change will not disappear anytime soon. Will the further rise of the financial market create extreme wealth disparity, thus triggering violent turmoil? Will the government levy taxes on investment income or even stifle innovation in order to maintain social order?

These are tail risks, and there are countless unimaginable things that may happen. Maybe the next global crisis will not be a good thing for innovation. Everything is unknown.

However, we can roughly think that in the next ten years and beyond, the rate of progress will continue to increase and the curve will continue to become steeper. Figuring out how to play is still tricky.

  • Both Kurzweil and Urban showed that progress is exponential growth, and it is not necessarily the company or the market that derives value from progress.
  • Although the global stock markets and the Nasdaq index have achieved perfect compounding, their composition often changes. It is difficult for us to predict which companies will receive the value created by compound innovation.
  • If innovation continues to accelerate, new technologies or models may replace existing leaders. Mobile devices have greatly changed this landscape; will cryptocurrencies have the same impact on fintech? Is there another platform shift that no one expected that might dramatically change the landscape?

In addition, if the global market value of listed stocks reaches US$320 trillion in 10 years, I would really be shocked, not because I don’t think that much value will be created, but because I suspect that so much of it will flow into listed stocks. If cryptocurrency is a disruptive force, as it seems, then more and more trillions of dollars in value will flow to token holders rather than public market shareholders. If these token holders are the ones who create value-creators and consumers-this is a great thing, but it means closing your eyes and buying S&P, Nasdaq or other public The market index is not as safe as it seems.

The problem I emphasize is that I am confident that treating what is happening as a fashion or temporary madness will make our thinking look too outdated.

Everything is getting faster and faster. Everything is getting crazy. It is impossible to predict exactly what will happen.

So how do you prepare?

It is important to keep an open mind. You should continue to play great online games. Reading science fiction will make the madness look more familiar (I just finished the “Half Mary Project” and it’s great). For those who are a little crazy, there are many opportunities.

Keep your eyes on the long term. As Patrick Collison said when describing his admiration for Jeff Bezos to Ezra Klein:

The concept of using time horizons as a competitive advantage has deep implications, because you are willing to wait longer than others, and your organization is oriented this way.

Position yourself this way, jump in and enjoy everything. The future will be crazier than you think.

Not Boring Jobs

On Thursday, I launched the Not Boring Jobs website, which is the best place to find a job in some of the fastest-growing and least boring startups.

Today, I am very happy to bring you a treasure: Cohere’s software engineers. A friend who told me about Cohere said: “Cohere is a software that will change software forever.”

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/nft-mania-may-just-be-the-beginning/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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