Pass it forward

Blockchain technology, cryptocurrencies, and token sales are all the rage right now. In the 5+ years I’ve been working in the VC industry, this is by and large the most wonderful I’ve envisioned any area to new technologies take off in terms of new company( or programme) formation.

It wasn’t too long ago that founders and VCs were mainly focused on centralized exchanges, initiative or private blockchain answers, pocketbooks, amongst several other favourite blockchain startup suggestions that reigned world markets from 2012 to somewhere around 2016.

However, as I wrote about just a few months ago, the rise of Ethereum with its Turing-complete scripting speech and the capacities for developers to include nation in each chunk, has paved the way for smart contract evolution. This has led to inflows of teams improving decentralized assignments seeking to enjoy the benefits of the most valuable owned of blockchains — the ability to reach a shared true that everyone agrees on without intermediaries or a centralized authority.

There are many eliciting occurrences to access to grocery both in terms of improving prevailing blockchain functionality as well as the consumer’s know. However, having regard to the speedy gait at which activities are coming to sell, I’ve perceived it to be difficult to keep track of each and every project and where each one fits into the ecosystem.

Furthermore, it’s easy to miss the forest for the trees without a extensive attitude of what the proverbial forest looks like .

As a outcome, here’s a compiled a directory of all of the decentralized blockchain-based projections that I have been following, and “ve managed to” dig up through investigate, along with recommendations from friends in the ecosystem.

A speedy renunciation: While it’s hard to pigeonhole a number of projects into one category, I did my best to pinpoint the main objectives or price proposition of each project and categorize them as such. There are certainly many is planned that fall into the gray area and could fit into multiple categories. The hardest ones are the “fat protocols” which offer functionality in more than a couple of areas.

Below is an overview of each broader category I’ve determined, touching on some of the subcategories that comprise them 😛 TAGEND


For the most part, these projects were created with the intention of constructing a better money for numerous apply the circumstances and represent either a accumulate of value, medium of exchange, or a group of accounting .

While Bitcoin was the first and is the most prominent projection in the two categories, many of the other projects set out to improve upon any particular perspective of Bitcoin’s protocol or tailor-make it towards a particular employ case.

The Privacy subcategory is likely to be fall into either the Pay or Base Layer Protocols categories, but I decided to break them out separately imparted how important anonymous, untraceable cryptocurrencies( especially Monero and ZCash) are for users who would like to conceal a transaction because they prefer not to program any particular acquire for one reason or the other, or for firms who don’t wishes to expose trade secrets.

Developer Tools

Projects within this category are primarily used by makes as the building blocks for decentralized employments. In succession to enable users to immediately interact with etiquettes through work interfaces( for utilize events other than business ones ), many of the current designings that lie now need to be proven out at scale.

Protocol designs around scaling and interoperability are active areas of research that will be important parts of the Web3 developing stack.

In my opinion, this is one of the more interesting lists at the moment from both an academic interest and an investment standpoint.

In seek for many of the blockchain use disputes we’ve been promised to come to perfection such as fully decentralized autonomous organizations or a Facebook alternative where useds have self-restraint of their own data, foundational, scalable infrastructure needs to grow and grown-up .

Many of these projects aim at doing just that.

Furthermore, these projects aren’t in a “winner take all” region in the same highway that say a cryptocurrency might be as a supermarket of value.

For example, building a decentralized data marketplace could require a a number of Developer Tools subcategories such as Ethereum for smart contracts, Truebit for faster computing, NuCypherfor proxy re-encryption, ZeppelinOS for security, and Mattereum for law contract execution to ensure protection in the case of international disputes.

Because these are etiquettes and not streamlined data silos, they can talk to each other, and this interoperability permit new application bags to rise through the sharing of data and functionality from several etiquettes in a single application.

Preethi Kasireddy does a great job of showing this dynamic here.


This category is fairly straightforward. When you’re interacting with a number of different etiquettes and applications( such as in the Developer Tools illustration above ), countless may have their own native cryptocurrency, and thus a number of brand-new economies emerge.

In any economy with several monies, there’s a need for tools for exchanging one unit of currency for another, promoting lending, countenancing asset, etc.

The Decentralized Exchanges( DEX) subcategory could arguably have been categorized as Developer Tools.

Many jobs are already starting to integrate the 0x protocol and I forecast this trend to continue in the near future. In a macrocosm with the potential for an exorbitant number of clues, widespread adoption of works expending several tokens will only be possible if the complexity of using them is abstracted apart — a benefit delivered by decentralized exchanges.

Both the Lending and Insurance subcategories is beneficial for economies of magnitude through danger aggregation.

By opening up these marketplaces and allowing people to now be priced in large puddles or on a distinguished, individual basis( depending on their risk chart ), penalties can decline and therefore buyers should in theory earn .

Blockchains are both stateful and immovable so because previous interactions are stored on bond, users can be confident that the data that comprises their individual biography hasn’t been manipulated with.


As the team at Blockstack describes in their white paper:

“Over the last decade, we’ve visualized a switching from desktop apps( that operate locally) to cloud-based apps that storage used data on remote servers. These centralized services are a prime target for hackers and regularly get hacked.”

Sovereignty is another area that I find most interesting at the moment.

While blockchains still suffer from scalability and accomplishment topics, the value provided by their trustless architecture can usurp act topics when dealing with sensitive data; the custody of which we’re forced to will vary depending on third party for today.

Through cryptoeconomics, users don’t need to trust in any person or organization but very in the speculation that humans will behave rationally when correctly incentivized .

The activities in this list supply the functionality necessary for a nature where useds aren’t forced to trust in any person or organization but preferably in the incentives implemented through cryptography and economics.

Value Exchange

A key motif of the Bitcoin protocol is the ability to have trust amongst several different parties, despite there being no affair or confidence between those parties outside of the blockchain. Transactions can be created and data shared by various defendants in an invariable fashion.

It’s widely pondered detail that beings begin to organize into conglomerates when the cost of coordinating creation through a market is broader than within a house individually.

But what if beings could coordinate into this proverbial “firm” without having to trust one another?

Through blockchains and cryptoeconomics, the time and intricacy of developing cartel is abstracted apart, which lets a large number beings to collaborate and share in the profits of such collaboration without a hierarchical organize of a traditional firm .

Today, middlemen and hire seekers are a necessary evil in order to hinder lineup, maintain safety, and enforce the rules of P2P marketplaces. But in many areas, these cryptoeconomic systems can replace that cartel, and cutting out middlemen and their fees will allow users to exchange goods and services at a significantly lower cost.

The jobs in the subcategories can be broken down into two main groups: fungible and non-fungible. Groceries that allow users to exchange goods and services that are fungible will commoditize acts like storage, computing, internet connectivity, bandwidth, intensity, etc. Corporations that sell these makes today emulate on economies of scale who are unable to be displaced by better economies of scale.

By opening up latent equip and allowing anyone to affiliate the network( which will become easier through projections like 1Protocol) this no longer becomes a daunting exercise, once again collapsing margins towards zero.

Non-fungible business don’t have the same benefits although they still permit providers to pay what their good or service is actually worth rather than what the middlemen thinks it’s worth when they are take their cut.

Shared Data

One way to think about the shared data bed simulation is to look at the airline industry’s Global Distribution Systems( GDS’s ). GDS’s are a unified data store where all of the airlines propagandize their record data in order to excellent coordinate all supply information, including streets and pricing.

This allows aggregators like Kayak and other corporations in the seat to dismiss traditional travel agents by constructing a front end on top of these systems that users can transact on.

Typically, sells that have been most attractive for intermediary aggregators are those in which there is a significant barrier to entry in emulating directly, but whereby technological advances have created a catalyst for an intermediary to aggregate incumbents, pertained metadata, and customer penchants( as was the case with GDS’s ).

Through financial incentives provided by blockchain located projects, we’re witnessing the single most impactful technological catalyst which will open up countless marketplaces, except the appraise no longer will accrue to the aggregator but rather to the individuals and companies that are providing the data .

In 2015, Hunter Walk wrote that one of the biggest missed the chance for the last decade was eBay’s failure to open up their stature structure to third parties which would’ve keep them at the centre of P2P commerce.

I’d even make this a step farther and “re saying that” eBay’s single more valuable asset is reputation data which is built up over long periods of season, forcing used lock-in and granting eBay the power to excise high taxes on its users for the peace of mind because this is transacting with good performers. In shared data blockchain etiquettes, users can take these types of datasets with them as other employments hook into shared data etiquettes, reducing barriers to introduction; increasing competition and as a result eventually increasing the speed of innovation.

The other channel to be considered shared data etiquettes can be better described applying a centralized fellowship, such as Premise Data, as two examples. Premise Data distributes system contributors who collect data from 30+ countries on everything from specific nutrient/ liquid consumption to substances being implemented in a particular geography.

The company exploits machine learning to extract insights and then exchanges these datasets to a range of customers. Rather than seeing and hiring people to collect these datasets, a project could be started that allows anyone gathering and share this data, annotate the data, and build different models to extract insights from the data .

Contributors could earn clues which would increase in evaluate as corporations use the signs to purchase the network’s datasets and revelations. In conjecture, research results would be more donors and higher caliber datasets as world markets provides the disappearing proportion for information materials and compensates players accordingly relative to their contribution.

There are many similar possibilities as the “open data platform” has been a popular startup project for a few years now with various firms find great success with the modeling. The challenge I foretell will be in sales and business development.

Most of these companies sell their dataset to big organizations and it will be interesting to see how decentralized projects administer theirs in the future. There are also opportunities that weren’t previously probable or fruitful as a standalone, private organization to pursue, given that the economics don’t work for a private company.


Ultimately, cryptocurrencies are just digital resources native to a specific blockchain and jobs in this category utilize these digital resources to represent either real world goods( like fair tickets) or data.

The immutability of public blockchains accepts network participants to be confident in the fact that the data written to them hasn’t been tampered with or changed in any way and that it will be available and accessible far into the future .

Hence why, for sensitive data or markets for good which are typically been rife with fraud, it would make sense to use a blockchain to assure the subscribers of their integrity.


While there’s a lot of innovation happening across all of these categories, the projects just getting started that I’m most excited about are enabling the web3 change load by providing functionality that’s required across different exert disputes, supremacy through user access authority of their data, as well as fungible evaluate exchange.

Given that beyond financial speculation we’ve more to see mainstream cryptocurrency exploit contingencies, infrastructure development and use suits that are hugely superior for users in either overhead, privacy, and/ or security in most delicate provinces( such as identity, approval scoring, VPN’s among other) seem to be the most likely campaigners to captivate significant value.

Longer-term, I’m stimulated about jobs enabling entire ecosystems to benefit from shared data and the bootstrapping of structures( non-fungible cost exchange ). I’m quite sure there are various other areas that I’m not looking at precisely or haven’t been illusion up hitherto!

As ever if you’re structure something that fits these touchstone or have any comments, questions or parts of contention, I’d love to hear from you.

Thank you to Jesse Walden, Larry Sukernik, Brendan Bernstein, Kevin Kwok, Mike Dempsey, Julian Moncada, Jake Perlman-Garr, Angela Tran Kingyensand Mike Karnjanaprakorn for all your help on the market planned and blog post.

Disclaimer: Compound is an investor in Blockstack and two other projects mentioned in this upright which have not yet been announced .

* Such articles firstly appeared on Medium and has been republished generosity of Josh Nussbaum.

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