The Dawn of Consumer Crypto

Browsers, applications, and platforms are how consumers live online. Today, new digital lives are being led in different corners of the internet on top of the blockchain. But for all the media coverage of crypto, users will only start to care about this revelatory infrastructure shift when showcased through the services they use most. It’s hard to see things in the dark, and consumers show up when these products and applications turn on the lights.

Historically on the web, consumer opportunity followed emerging infrastructure. Web1 server structures put individuals online, gave the masses access to the internet to consume and communicate, and made it all accessible through the browser, search and chat. But it took Netscape, Google, AOL & others to show consumers what that infrastructure could do. Web2 presented the cloud and introduced a new wave of scalability and the emergence of the social web. All of a sudden, people could connect online, purchase online, trade online, catalog their life online… everything together online. The web was cheaper to consume and accessible to anyone who could find a connection. Now we have the acceleration of web3 infrastructure. Billions of investment and treasury dollars are sitting in the next internet’s foundational layer (Ethereum, Solana, Polkadot, etc.). web3 promises a new gateway for billions of users to live even more online through self-sovereignty, portability, and ownership. But today, only one breakout consumer experience has reached far beyond the crypto community; Coinbase.
Living online relies on infrastructure. But that doesn’t mean consumers care about the infrastructure itself. They care about what it can unlock for their online lives: status, entertainment, financial gain, etc. When was the last time you used Spotify and thought, “this is great because it’s hosted on AWS!”? You use Spotify because of the entertainment it provides you as an individual, brought to you by the infrastructure it showcases. Consumers care if things work and benefit them as individuals over all else. web3 is presenting entirely new behaviors and business models to the web, and now it’s up to us to show consumers what that can do and how it can benefit their digital lives.

These new forms of living online are starting to materialize in several specific ways:

Culture, Status, and Community: Now that digital ownership is exploding through NFTs, people are seeing more significant financial and status opportunities online than offline. This is the most critical catalyst for living online we’ve seen to date. Individuals are building status and identity in the virtual world the way they do in the physical world. Why own a Gucci bag to impress a few hundred people in your town when you can own a digital one to impress millions? How you dress, accessorize and socialize online is now directly tied to your identity and status, where consumers take Crypto Punks or Bored Apes and make them their profile picture (PFP). This signal drives identity, status, and community in an entirely new way.

24/7 Markets for Everything: Coinbase turned markets into a 24/7 industry, spilling over into other industries where consumers are at the forefront. The role of the consumer has shifted from spectator to participant, meaning more individuals can contribute to the passions and products they love most. For example, Zed Run (in which an affiliate of TCG Capital Management, LLC holds an investment) is a virtual horse racing game that lets individuals purchase, breed, and race horses. It’s not limited by physical space or time, and it’s entirely up to the owners: consumers. Media markets are being built around this. DAOs are structured to allow communities to pool together to purchase and raise horses as a collective — all of which exist online unbounded by physical constraints.

New Business Models: web3 inverts the internet’s business models by giving more value and ownership to both creators and consumers. Traditionally, platforms developed online have been driven by advertising and subscriptions, and this is because Web2 took a consumer-first approach to media, protocols, and applications with the platforms as intermediaries. web3 puts value back into creators’ hands while giving consumers new opportunities. web3 platforms like Mirror and Foundation introduce new revenue streams to participants, allowing for crowdfunding, collaborating, and equity ownership between producers and their customers. Programmable royalties will change the way every piece of media is created, traded, and exchanged. Play-to-earn games will create new jobs on the internet, letting people truly live online.

It’s important to note that it’s still early days, and the best crypto applications for consumers are still limited compared to Web2 experiences. To welcome those outside the crypto space, consumer adoption requires a shift in mindset, talent, and user on-ramps. And that means building valuable tools and experiences that benefit those building lives online, showcasing the power of web3, and unlocking opportunities for those participating directly in products on top of the blockchain.

The dawn of consumer crypto is here, and we now need to shine a light on it.