# Web3 Investing thesis

By [Simon Chamorro](https://paragraph.com/@simonft) · 2022-03-03

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Why invest in Crypto/Web3?
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*   We are witnessing the **early days** of the emergence of a global, open financial system, the impact of which will dwarf that of the internet itself.
    
*   Web3/Crypto is an open source technology with deep-rooted **network effects**. Each [cycle](https://twitter.com/simonchamorro_/status/1481218773654949890) grows at ever faster speeds.
    
*   **It is zero-sum**. Programmable on-chain money will kill friction-heavy financial services.
    
*   **Crypto/Web3 is a silent killer.** It will take over in slow incremental changes.
    
*   A **crypto-native relay generation is taking over** power and wealth in the next 5-10 years.
    
*   New and existing asset classes will be ported natively onto the internet, with **all value settling on blockchains.**
    
*   Permission-less access to non-sovereign stores of value, paired with powerful coordination and incentive mechanisms, is becoming **the new norm**.
    
*   The industry has attracted only a few Entrepreneurs, Fortune 500 companies, Politicians, and **Institutional money**. The true tipping point is near.
    
*   It is a revolution, **an ideological paradigm shift**. Hard to erase an idea from the minds of over 200 million people.
    

How to invest and make decisions?
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*   The market can’t be timed. **Long-term building & investment wins.**
    
*   **Communities are king**, technology is second, revenue is third. Focus on the former.
    
*   Back early-stage ventures, publicly-traded protocols, and everything in between.
    
*   **Layer 1 will capture the most upside** by allowing superimposed protocols.
    
*   The market is **decoupling** from Bitcoin and Ethereum every cycle. **Be nimble.**
    
*   Have a **decision-making framework** with aligned incentives.
    
*   **Find and focus on my Alpha**; my area of expertise.
    
*   New verticals offer asymmetric opportunities. **Be ok missing some.**
    
*   **Composable products & software** > monoliths
    
*   **In Web3 reputation travels with you.**

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*Originally published on [Simon Chamorro](https://paragraph.com/@simonft/web3-investing-thesis)*