1st Wave

I consider the first wave of crypto as the period when Bitcoin first launched to when it first gained mainstream attention as a result of Laszlo Hanyecz buying 2 pizzas for 10,000 BTC.

At this point in time, Bitcoin was still regarded as a conversation piece nerds would use on dates to experience whatever the opposite of an aphrodisiac is. The only use case for BTC at the time was privacy because most people didn’t know what a blockchain was. And if they did, they didn’t care because they were still trying to recover from the 2009 financial crisis.

2nd wave

In 2013-2016, BTC reached $1,000 and $20,000. This is when opportunists saw a 1000x return on some nerd coins and wanted to pry as much money from retail’s oblivious little hands as possible. Every other day was a new ICO launch for some token that promised a 20x return and utility that only Nostradamus could see so you better invest unless you want to miss out.

Shitcoin after shitcoin launched which actually did give many investors a 20x, but in the other direction. Straight to 0.

The utility in this wave was basically milking investors dry and then later shrugging and telling them they decided to pivot. Burned investors swore to never touch crypto again.

3rd wave

But then defi summer hit. New financial products started emerging along with more mature apps for interacting with smart contracts on-chain.

2600% APY on new shitcoins! 20% APY on a stablecoin ponzi!

Retail quickly forgot how they were dumped on in the 2nd wave and went all in again. This time they brought along millionaires and billionaires who thought they were smart because they invested during a bull market.

New ways to scam retail emerged with the biggest narrative being NFTs. NFTs are basically an easier way to trick retail into giving money to strangers because now they own a picture some guy on Fiverr took 30 minutes to draw and an anonymous influencer pinky swore that they were going to hit the milestones on their monkey roadmap.

The utility in this wave was still… fucking over retail. But this time at scale!

4th wave

One can hope that this wave washes away the cumcoins and allows the true utility of blockchains to rise up. Proof of ownership, decentralization, decentralized IDs, soul bound tokens, zero knowledge proofs, mpc wallets. What I’m trying to say is, right now, we’re still very early. 95% of Web3 products don’t solve a user problem better than Web2 would. It’s just the same Stripe knockoff but in a prettier package.

The true winners in crypto, which I’m hoping will finally come in the 4th wave, will be like all great products before it. Ones that focus on solving user problems and only use Web3 because it gives them the best way to do so.