Cryptocurrency's Greatest Value: The Social Layer
We are beginning to see a few forecasts emerging regarding the potential market capitalization of cryptocurrency. Over the last week, we covered a couple of them where "hundreds of trillions" was tossed around.
The conclusions reached are logical. Some take the viewpoint of real world assets (RWA) while others are interested in the digital creation. Both are likely to have a major part in the overall impact of blockchain as a ledger.
However, we see many overlook the most potent aspect to all of this. There is a layer that is already worth trillions yet is not captures. Real world assets might not be on-chain but the value is captured. The conversion to blockchain is simply one of friction removal, making things less expensive while also potentially having assets liquid.
Simply put, this doesn't generate much new value, proportionately speaking. For example, if real estate is liquid, what will it add? The removal of friction could make the market 5%-10% bigger. Of course, this is a huge number when we look at the global real estate market.
That said, we have another area that is not captured, hence is freshly accrued value.
Image generated by Ideogram
Social Tokens Are Going To Be Worth Trillions
How much is the social layer worth?
This is an impossible question to answer. At the moment, nothing is really captured here. When we look at interaction, the system misses a huge component of value.
For example, what is value of Disney's social layer? How about Tesla's? The Office? Marvel Comics? Star Wars?
In other words, what is fandom worth?
The way this is commonly answered is by looking at the revenues generated. When the owner of the series The Office licenses it out, because it is more popular, it might command more money than Bob Vila's home improvement show.
Franchises such as Star Wars are quantified not only by the films but merchandising, conventions, and video games related it.
There are two problems with this:
- This approach misses a great deal of the value. In fact, it really doesn't capture the value which is still there. It is only focusing upon the monetization.
- The fans (users/customers) are not financially benefitting. All "network effects" are going to the companies behind this. It is how the system is designed.
Here is where social tokens change things completely.
Social Tokens Capturing Entire Ecosystems
When investing in a company, we usually have two main approaches.
We can either buy the stock or debt. These are the two avenues available to people when they enter the markets. Of course, both carry with them different means of return while also providing assorted rights inherent with the asset.
Neither of these capture the value of the social layer.
Web 3.0 changes the entire spectrum of the design by providing a means for quantifying the social layer. Suddenly, fandom has value and, more importantly, can be captured in a tradeable unit.
This means that being a fan has value. Naturally, this was always known as the owners of sports teams and broadcast networks could tell you. Nevertheless, we are looking at a shift in the "attention economy".
Monetization of the social layer means already existing value is pumped into the global economy. People who spend their time engaging in activities out of passion instantly are on a different footing. We are dealing with another form of business interaction.
For example, we could see this value eligible for use as collateral on loans. Consider the idea that your love for the Marvels helps to secure a mortgage. Tokenization provides asset ownership.
Everything is eligible which makes the potential enormous. Whatever people have an interest in can be tokenized since that is a social layer.
Once this concept is embraced, consider the layering that can occur.
For example, a fan of the character Luke Skywalker is also likely one for Star Wars. This means that can be applied to LucasFilms. That is owned by Disney, putting it as part of that social layer. Of course, it is sci-fi, something which one might be part of. Then we have the movie genre as a whole.
Here is a list of 5 layers where one person's interest is relevant.
An Entirely New Structure
Tokenization provides the opportunity for a completely new business structure.
The challenge I have with most analysis of crypto is people are still focusing upon things using the metrics that are prevalent today. Do we measure the gas tanks in our cars by the number of oats that fit into it? Of course not.
With technology, the most common approach is to take what we know and simply look at something as an upgrade. For example, the early personal computers were viewed simply as glorified word processors. In other words, they were digital typewriters that could save the document.
The typewriter and a piece of paper (document) were things people were familiar with. Most using those early models could not envision what the device could truly do (or what it would evolve into).
How many are doing the same thing with cryptocurrency? I would say most.
The fact that most analysis or forecasts fail to mention the social layer exemplifies how this value is overlooked. Actually, I would say few realize it even exists.
What is your fandom worth?
This is a question that is going to be the norm in the future since it will be an asset that is quantified.
We will see how long it takes for people to grasp this concept.
Posted Using InLeo Alpha
The social layer of crypto has been underestimated. Many out there in the crypto space barely recognizes the potentials that lie here and what it brings into the uture. Thanks that we've discovered Hive early enough.
This space cannot be ignored for long.
The real $GOLD is here.
It's been ignored for the past 4 years and the token has dropped out of the top 400... I am not as optimistic about Hive's future these days. It's become an echo chamber with hardly any engagement.
What do you think could be the cause of the declining interest despite the value its generating?
Could it be the pricing?
It's not generating that much value when the price of the token continuously drops down the marketcap list. We can't even hold above .35. That has a big thing to do with it. But the other fact that I have heard from many is the lack of engagement. I have talked with crypto influencers that have posted on Hive in the past and say it's a waste of time because there is really no community. It's an echo chamber of a few thousand people, many with multiple accounts. Many of the "active" accounts are really just auto voting accounts.
Also the lack of support for developers trying to build actual use cases like myself and others that are no longer around, or not nearly as active. I have talked to other people that have tried and get the same answer every time. The lack of support speaks volumes about people's intentions. Nobody really wants to help, they only want to fill their own bags and sell off. That and the fact that the DHF is a circle jerk for the whales and no small proposals have a chance of getting funded. It's nothing but a pipe dream for the community, while many of the OG whales get funded for basically doing nothing.
These are all reasons why I am powering down and moving what little value is left into my 3D printing farm and my trading account on BSC.
Great points there.
You've been here for the long while and could understand here so far. Some great stuffs may be ignored for long, but eventually could have a breakthrough. AN example is INLEO. Been around there since the days of SteemLEO. Despite not DAO support, we see where INLEO has reached now. Many prospect are and would be unveiled. The recently passed proposal is a product of grit and resilience.
You've got great ideas and projects here which I've followed, it could take just a little more patience for the breakthroughs to happen.
However, your side hustle that brings in cash regularly should not be abandoned.
Think of collaborations.
Tried out applying out a DAO fund?
Always having my support.
I submitted a proposal in the early Hivelist days and it failed, but there were people getting funds that literally were not providing any value to the chain whatsoever. Then over time, I have seen many good proposals not get funded because the person wasn't either popular enough with the main whales or something, I don't know. Like I have seen many marketing props get turned down simply because the whales in charge don't want to see a huge wave of people because it takes away from their inflation rewards. Hive is not as decentralized as people want to make it out to be.
This post has been manually curated by @bhattg from Indiaunited community. Join us on our Discord Server.
Do you know that you can earn a passive income by delegating your Leo power to @india-leo account? We share 100 % of the curation rewards with the delegators.
100% of the rewards from this comment goes to the curator for their manual curation efforts. Please encourage the curator @bhattg by upvoting this comment and support the community by voting the posts made by @indiaunited.
I like the enthusiasm, but I am not as optimistic anymore that Hive is going to really do anything big. We dropped out of the top 400 last week, and continued to get ignored the the rest of the crypto community on other platforms. Other projects as well have come and gone in the past year or 2 and have completely collapsed for the most part. Not to mention, how many tokens do we have on Hive-Engine that have dropped to basically 0? Quite a few. So I am not as optimistic in the whole social aspect of things anymore. I am still here posting and engaging though only because it's not near as toxic as everywhere else, that is if you don't say something to piss off the whales.
We need to seriously focus on the social aspect of the platform, it's the very foundation of everything we see here
It seems to me that you've really been through the ups and downs of the crypto world, especially here on Hive. Very disappointing to see promising projects struggle, especially when they're not getting the support they need. I understand why you're feeling less optimistic about the social aspect of things here. Hopefully, things will turn around, and your patience and perseverance will pay off in the end Taskmaster. We're going to Work hard on this
Stick around and you will see the ups and downs.
Aye Captain
Do we measure the gas tanks in our cars by the number of oats that fit into it? Of course not The crypto industry is beyond what we classify or categorize it to be. It has been something I have been looking at for a while now. Even those who claim to know have just a tip of what digital asset will becomebecome.
There's no other way but to move forward and surely social media with crypto will always be on the map. There's a great chance all social media in the future will be tokenized and hopefully, Hive will be one of the best by then.
I think the Hive movie and Race car are good ideas, but it remains to be seen if each will generate interest in something as difficult as blockchain and HIve, along with Hive particular pain points.
well said, following your articles makes crypto investing a lot easier then it was, through you throughing more lights on the subject and technically equity it to investing in stocks as a major stockholder.
This article sounds like a motivation to me, as the game changer; web 3.0 exist in the world of assets, where engagement is being paid and ownership at large is being rewarded, all I can say it's best to hop on early it will take less work to grow your assets than later on.
Interesting points.
I agree the social layer will be big, but I worry the timetable may exclude me from benefitting.
As I see it, those who are successful in the web 2 social layer have a vested interest in it's continuance and dominance.
Those who have no rewards from web 2 have no influence.
Even big influencers on web 3 seem to have limited ability to encourage development on web 3 and many good projects die in obscurity.
I think, an established influencer from web2 moving here with their fans would make a significant impact on the pace of adoption of web 3 social layer tokens, but they are disincentivized from doing this by the current web 2 model and their fear of be deplatformed. Additionally there are forces at work on web 3 platforms which are agressive, angry and attempt to force these influencers to do things which could threaten their web 2 livelyhood. They fail to take into consideration the concerns of these influencers and flex their power in ways which are counter productive to bringing big influencers here.
I honestly feel these activities do serious harm beyond those influencers, as bad experience stories are repeated far more often then good experience stories. And the population of big influencers in cryptocurrency who would consider a presence here is small. The low price of the Hive and other tokens relative to BItcoin or Ether doesn't help either. Ask an influencer if they want to work for peanuts and take shit from people they can potentially lift out of obscurity... that's a hard no.
Plus even though web 3 has freedoms web 2 lacks, web 3 has it's own destructive elements which punish content creators as harshly, if not more then deplatforming on web 2.
I understand the promise of web 3 but the execution is not producing the effects I had hoped to see, and after six years on this platform, I am disappointed.
It has nothing to do with influencers although that could be a fanbase.
What about those who are into woodworking? Or classic cars? That has nothing to do with an influencer. It is a community around a common interest.
I see your point, but I stick with mine because while there may be groups who congregate around common interest, social media congregates around influencers.
Additionally I think cryptocurrency and blockchain are very complex, thus groups congregating around it seem much smaller then groups congregating around influencers.
One inlfuencer with 21 million followers encompasses all people in cryptocurrency by some estimates.
But I get your point, and it may be a path towards growth, but not mass adoption.
When I look at HIve and it's lack of mass adoption, it may an illustration of the limits of growth fueled entireluy by common interest.
I suspect greed, envy, lust, hate and other primal emotions are the driving force for mass adoption and until we generate that appeal we will languish as a community of small numbers.
Tokenization of the social layer is an interesting topic. While I like to think we have it with Hive, imagining how it will work with FB or Instagram can make it wildly successful. I think there are stars in FB, and bits in Twitch, that you can award streamers. This helps them earn more, and I can see something like this being implemented to other social media platforms.
Drill down more.
Think of something such as being a fan of the LA Lakers. Or being into woodworking.
All of that is part of the social layer that has value yet isnt captured. And people are everywhere.
I delivered on my promise Big brother Taskmaster 🥰 I've been spreading the word like you asked me to..
I also said I would be writing a blog on the importance of we building the chain ourselves
It's done now🥰
https://inleo.io/@theringmaster/the-power-of-engagement-building
That is good. We can all enhance what is taking place. The level of excitement we have will be felt by newer users.
Thanks for this big brother 🥰🥰🥰🥰 I'm encouraging some new users right now too😂🥰