The SEC recently chose not to label Bitcoin and Ethereum securities, leaving two clear paths exist for establishing a legal blockchain tokens: fair-launch (like Bitcoin mining); and decentralizing control over time (like Ethereum). Current US law makes it impossible to follow the Ethereum path because coin offerings are illegal. The standard venture capital equity raise model notwithstanding, this leaves zero investment as only other legal path start a cryptocurrency.
Achieving distribution and popularity without financial investment makes a difficult job exceedingly more so, which shortens the opportunity for a token or decentralized application considerably. To succeed a new crypto currency must gain mass appeal extremely quickly or fail due to staff departures due to payment in worthless tokens.
Solana’s low transaction cost and community culture create an abundance mindset in teams building on the platform, and that this creates a window of opportunity for new projects building on the platform. They can achieve popularity quickly the traditional way: by creating Economic Opportunity.
Popularity will require a sentiment shift for crypto similar to the mass support Uber and AirBnB achieved. It’s easy to forget, but regulators hated those products. People loved them.
Solana is the first blockchain to offer a long-tail platform for advancement. One that creates opportunity for the late majority, attracts builders not interested in “striking it rich”, and benefits the economically downtrodden as well as the pioneers. While blockchains are known for capturing “gold rush” excitement, none have successfully bridged this excitement over to the land of opportunity for all because of high fees and deflationary supply.
Solana is well positioned to massively expand opportunity because its core value maps to the key lesson of the Internet: scale maximizes value. What reference application might demonstrate this scale? Ads. No, seriously. Ads but better. A consumer-first, new paradigm for engagement.
The next phase of the Internet will see more people become brands. Influencer 2.0. And it won’t be just entertainers, it will include writers, journalists and educators. This means a few important things:
Brand equity for content producers
Audience direct engagement with creators
Open and fair engagement tracking
Three innovations make today the first time this product can be built: Firedancer; executable non-fungible tokens (xNFT); and compressed NFT’s (cNFT). All three exist only on Solana.
Firedancer is a new Solana validator that will bring chain stability and fast confirmations that rival web2 database API’s. Anyone building on Solana gets this fast, open-source foundation “for free”.
xNFT’s are collectibles that run code like standard apps. This innovation enables digital assets (NFT’s) to themselves function as a wallet for loot boxes, and contextualize features like push notifications and media or ticketed-event access management.
cNFT’s are 1,000 times cheaper than traditional NFT’s yet retain ownership rules. Similar to browser cookies, they have the potential to act as top-of-funnel token engagements rather than precious works of arts only. Near-zero costs allows novel uses, where users proceed to conversion while collecting assets along the way.
Product user story: Alice sees a banner about Lionel Messi moving to MLS. She clicks the ad and claims a Messi cNFT with her email, but does not have a crypto wallet so it stays in her web2 profile as “claimed”. Later Alice sees a similar ad and claims a second cNFT. Next, realizing she wants to control and maybe trade them, she clicks “take ownership”, installs a crypto wallet, and now directly holds the cNFT’s.
After collecting a third cNFT from an email clickthrough, Alice sees an offer to purchase limited Season 1 InterMiami Messi xNFT’s for fans who own 3+ cNFT’s. This leads to a conversion event: she buys it, and it drops into her crypto wallet. Alice now owns a Messi xNFT that doubles as a special events ticket. InterMiami can also drop loyalty points to her xNFT, letting her know they did. If Alice sells the xNFT, the loyalty points transfer as well. All the way, chain auditors credit Lionel Messi for contracted activities.
This story naturally applies to gaming company player, and journal subscriber acquisition as well.
Technologies sometimes appear stuck searching for a problem to solve but, when combined in the right way by the right team, can integrate into the next breakout product category.
Crypto expands economic opportunity, but the new architecture makes it hard to see. Solana, with its high speed and low cost, attracts innovators who help fill in the picture. A series of engagements upends web2 user ad-tracking, letting people collect digital assets as they move through the product discovery funnel. This gives them a bit more control, a stake, and cool products. Now that will be popular.