40 under 40 in Cybersecurity 2022
[real3dflipbook pdf="https://www.bizzboard.com/wp-conte...
What is web3?
01.
02.
03.
The first era of the modern
The second era of the internet
We are now beginning the third
internet — roughly 1990-2005
— roughly 2005-2020 —
era of the internet — what many
— was about open protocols
was about siloed, centralized
call web3 — which combines
that were decentralized and
services. Most of the value
the decentralized, community-
community-governed. Most of
accrued to a handful of large
governed ethos of the first era
the value accrued to the edges of
tech companies.
with the advanced, modern
State of Crypto
the network: users and builders.
functionality of the second era.
This will unlock a new wave of
creativity and entrepreneurship.
Source: https://cdixon.mirror.xyz/0GBv9WRI-LQE6F4r2gGczG6AVeFlNuvt3HETHZ5A93U
©2022 Andreessen Horowitz. All rights reserved worldwide.
web3
2022
State of
Crypto
Why Web3
Matters
3
©2022 Andreessen Horowitz. All rights reserved worldwide.
Why Web3 Matters
Digital
Authoritarianism
Big Tech
Oligopoly
The internet as we
know it is flawed
4
©2022 Andreessen Horowitz. All rights reserved worldwide.
After friendly beginnings, web2
companies have become more
extractive and less cooperative
Charts for illustrative purposes only
Why Web3 Matters
5
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Why Web3 Matters
Web3 gives people property rights:
the ability to own a piece of the internet
©2022 Andreessen Horowitz. All rights reserved worldwide.
6
Why Web3 Matters
Web3 aligns network
participants to work
together toward a
common goal — the
growth of the network
Charts for illustrative purposes only
7
©2022 Andreessen Horowitz. All rights reserved worldwide.
Web3 empowers a collective
owned future over a corporate
or government owned future
8
Single points
of failure &
control
Resilient,
equitable &
participatory
©2022 Andreessen Horowitz. All rights reserved worldwide.
Why Web3 Matters
Source: RAND
web3
2022
State of
Crypto
Cycles of
Innovation
9
©2022 Andreessen Horowitz. All rights reserved worldwide.
The crypto market
develops in cycles
Price
Interest
New Ideas
10
©2022 Andreessen Horowitz. All rights reserved worldwide.
Cycles of Innovation
Startups &
Projects
Cycles of Innovation
These
cycles
appear
chaotic
from the
outside
but have an
underlying
order
©2022 Andreessen Horowitz. All rights reserved worldwide.
Global Crypto Market Cap
Developer Activity1
Startup Activity2
Source: CoinMarketCap, GitHub,
Pitchbook, Twitter
Social Media Activity3
Data is as of 5/12/2022
1 Developer activity based on stars
of crypto-related repositories on
Github.
2 Startup activity based on cryptorelated initial funding rounds via
Pitchbook
3 Social media activity based
on crypto-related comments
on Twitter
12
The result is
consistent longterm growth,
driven by
a feedback
loop between
interest
and innovation
Cycles of Innovation
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Global Crypto Market Cap
Developer Activity1
Startup Activity2
Source: CoinMarketCap, GitHub,
Pitchbook, Twitter
Data is as of 12/31/2021
Social Media Activity3
1 Developer activity based on stars
of crypto-related repositories on
Github.
2 Startup activity based on cryptorelated initial funding rounds via
Pitchbook
3 Social media activity based
on crypto-related comments
on Twitter
web3
2022
State of
Crypto
Layer 1
Blockchains
13
©2022 Andreessen Horowitz. All rights reserved worldwide.
Blockchain
computers are
composed of
nodes: physical
computers, like
PCs, joined together
via a consensus
mechanism
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Layer 1 Blockchains
14
Web3 is multi-chain; developers
have many options when it comes
to building on blockchains
Ethereum
Solana
Polygon
BNB Chain
Avalanche
Fantom
5.5M
15.4M
2.6M
9.4M
609K
308K
15.3M
3.4M
5.0M
832K
743K
Layer 1 Blockchains
Active Addresses
1.1M
Daily Transactions
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Source: Nansen; Active addresses is measured over a 30-day period as of 5/12/2022; Daily transactions
is represented by a 30-day average as of 5/12/2022.
15
Layer 1 Blockchains
Transaction Fees Paid
by Users (7D Average)
Source: https://cryptofees.info; Data is as of 5/12/2022.
While other smart contract platforms
rival Ethereum in users and usage, the
demand for block space is unmatched
16
©2022 Andreessen Horowitz.
All rights reserved worldwide.
With Ethereum L1 as the hub,
a significant amount of value is
being deposited into bridges
Top Ethereum Bridges by Total Volume In
17
Top Ethereum Bridges by Total Depositors
Layer 1 Blockchains
©2022 Andreessen Horowitz. All rights reserved worldwide.
Source: Nansen; Includes bridges with > 10k depositors; Data is as of 5/12/2022.
Ethereum continues to attract the most
developers, but several emerging
ecosystems are on a similar trajectory
Layer 1 Blockchains
Monthly Active Developers
Since Launch
Source:
Electric Capital 2021 Developer Report
Data is as of 12/31/2021
18
©2022 Andreessen Horowitz. All rights reserved worldwide.
Note:
Some ecosystems were excluded
due to the lack of sufficiently granular
categorization.
web3
2022
State of
Crypto
Layer 2
Scaling
19
©2022 Andreessen Horowitz. All rights reserved worldwide.
20
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Optimistic Rollups
Zero-Knowledge Rollups
Transactions are assumed to be valid, but
can be challenged if necessary
State transitions are computationally
verified off-chain using validity proofs
• More production-ready
• Less production-ready
• Correctness relies on game-theoretical
incentives
• Correctness is mathematically guaranteed
• Finality on L1 depends on a 1-week
challenge period
• Harder to program
• Easier to program
• EIP-4844 (proto-danksharding) can make
these rollups very cheap for users
• Finality on L1 is instant
• Proofs can be computationally expensive,
though this is rapidly improving
Layer 2 Scaling
A layer 2
is a separate
blockchain
that extends
the base layer
and inherits
its security
guarantees
Optimistic rollups are the most
popular L2 tech today, but ZK rollups
are just beginning to come online
Layer 2 Scaling
Total Value
Locked on
Ethereum
Layer 2s
Source: https://
l2beat.com/
Data is as of
5/12/2022.
21
©2022 Andreessen Horowitz. All rights reserved worldwide.
L2 rollups pay for Ethereum’s security
Today, L2 rollups
contribute to
of all fees paid
on Ethereum
22
L2 Rollups
One Day Security Costs
Source: https://l2fees.info/; Data is as of 5/12/2022.
Layer 2 Scaling
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Layer 2 Scaling
L2 rollups are
competing
hard against
each other to
bring transaction
fees down
23
Source: https://l2fees.info/
Data is as of 5/12/2022.
©2022 Andreessen Horowitz All rights reserved worldwide.
web3
State of
Crypto
DeFi
2022
24
©2022 Andreessen Horowitz. All rights reserved worldwide.
DeFi
A huge part
of the world
is underserved
by existing
fi nancial
institutions
Sources:
The Global Findex Database, 2017 Report;
The World Bank (2020 and 2021 data)
©2022 Andreessen Horowitz.
All rights reserved worldwide.
25
DeFi has grown from nearly zero to over
$100 billion in less than two years
DeFi
26
Source: Defi Llama; Data is as of 5/12/2022.
Total Value
Locked
in DeFi
©2022 Andreessen Horowitz. All rights reserved worldwide.
Newer blockchains are trying to replicate
the success of DeFi on Ethereum
27
DeFi
DeFi
Market
Share
(TVL) by
Blockchain
Source: Defi Llama;
Data is as of 5/12/2022.
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Token exchange and lending protocols are
the most popular DeFi use cases today
DeFi
Trading Volume on Decentralized Exchanges
28
Source: Token Terminal
Data is through April 2022.
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Borrowing Volume on Decentralized Lending Protocols
29
Proof-of-stake is
coming to Ethereum
Source: Nansen
Data is as of 5/12/2022.
DeFi
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Total ETH Staked to Beacon Chain
Top ETH 2 Deposit Addresses
DeFi would
represent the
31st largest US
bank by total
assets under
management
Source:
Defi Llama, https://www.federalreserve.gov/releases/lbr/current/;
Bank AUM data is as of 12/31/2022
DeFi TVL data is as of 5/12/2022.
©2022 Andreessen Horowitz.
All rights reserved worldwide.
30
DeFi
web3
State of
Crypto
Stablecoins
2022
31
©2022 Andreessen Horowitz. All rights reserved worldwide.
Stablecoins
There are three primary categories of
stablecoins, though the lines between
them are blurry
32
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Increasing use of stablecoins demonstrates
demand for a digital dollar
Stablecoins
Total
Stablecoin
Supply
Source: CoinGecko
Data is as of 5/12/2022.
Only includes stablecoins that are
believed to be fully collateralized.
33
©2022 Andreessen Horowitz. All rights reserved worldwide.
The on-chain velocity (i.e., rate of
turnover) for today’s top stablecoins
varies drastically
110.74
Stablecoins
34
60.38
Velocity
(annual on-chain
transaction volume
per unit of supply)
2.52
Dai
USDC
Tether
Source; Coin Metrics; Data is as of 5/12/2022.
©2022 Andreessen Horowitz.
All rights reserved worldwide.
35
Stablecoins
represent
just a tiny
fraction of
the world’s
money
supply
©2022 Andreessen Horowitz. All rights reserved worldwide.
Total Money Supply (M1) by Country
Source: Messari, https://take-profit.org/en/statistics/money-supply-m1/
Data is as of 5/12/2022.
Stablecoins
web3
State of
Crypto
NFTs
2022
36
©2022 Andreessen Horowitz. All rights reserved worldwide.
01.
37
We’ve seen several
categories of NFTs emerge,
but it’s still very early days
01.
02.
03.
04.
05.
Profile Pictures
Images displayed
on social media that
represent an online
identity
Art & Music
A more efficient and
transparent way for
artists to monetize
their work
Gaming
Unique assets
designed to be
used within
a game
Utility
Items that grant
special access,
benefits, rewards,
or memberships
Virtual Worlds
Ownable properties
that exist in new
virtual worlds
02.
03.
04.
05.
NFTs
©2022 Andreessen Horowitz. All rights reserved worldwide.
The NFT market remains hot, and we are
beginning to see mainstream adoption
NFTs
Ethereum NFT
Market Activity Weekly
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Source: Nansen; Includes all Ethereum-based activity and excludes suspected wash trades; Data is as of 5/12/2022.
38
39
Take Rates of Popular Creator Platforms
“You know something is profoundly wrong with
our economy when Big Tech has a higher take
rate than the mafia.”
– Ritchie Torres, U.S. Congressman representing the South Bronx
©2022 Andreessen Horowitz.
All rights reserved worldwide.
NFTs
Web3 platforms
have drastically
lower take rates
than the internet
giants today
Estimated Creator Revenues by Source (2021):
NFTs offer
creators a
whole new way
to monetize
directly with
their fans
NFTs
Sources:
1 a16z analysis of public data on the Ethereum blockchain,
2 https://www.forbes.com/sites/marisadellatto/2022/03/24/spotify-says-it-paid-7-billionin-royalties-in-2021-amid-claims-of-low-pay-from-artists/
3 https://www.socialmediatoday.com/news/youtube-generated-288-billion-in-ad-revenuein-2021-fueling-the-creator/
4 https://www.facebook.com/zuck/posts/10113607549897721
40
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Airdrops
NFTs
There is
incredible
innovation
happening
in the NFT
space
©2022 Andreessen Horowitz.
All rights reserved worldwide.
NFT DAO Governance
Music Royalties
IP/Commercial Rights
IRL Activation
41
web3
2022
State of
Crypto
Web3
Gaming
42
©2022 Andreessen Horowitz. All rights reserved worldwide.
Web3 Gaming
©2022 Andreessen Horowitz.
All rights reserved worldwide.
We are just
beginning
to see the
potential of
web3 gaming
43
Video Games
©2022 Andreessen Horowitz. All rights reserved worldwide.
Web3 Gaming
When the internet came along, video
games responded by embracing
new genres like MMOs and battle
royale, new business models like
free-to-play and virtual goods, and
new complementary behaviors like
streaming.
Recorded Music
Global Consumer Spend
The video
game industry
has seen
massive
growth, driven
by the layering
of new platforms
and business
models
Global Consumer Spend
44
The music industry responded by
spending decades filing lawsuits
against innovators, and eventually
accepting the incremental
improvement of allowing users to
subscribe to bundled content via
streaming platforms.
Source: MatthewBall.vc
Web3 Gaming
There is a
huge market
opportunity
at the
intersection
of web3 and
gaming
Source: Blockchain Game Alliance, DappRadar; First two metrics are as of 12/22/2021, third metric is as of 5/12/2022.
45
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Metaverse Land—Secondary Sales
Web3 Gaming
Metaverse
Land Sales
$1,808,580,704
46
Source: https://dune.xyz/metaland/Metaverse-Land-Community
Data is as of 5/12/2021.
Interest in the
metaverse
has exploded,
with land
sales
totaling
nearly
$2 billion
©2022 Andreessen Horowitz.
All rights reserved worldwide.
web3
State of
Crypto
DAOs
2022
47
©2022 Andreessen Horowitz. All rights reserved worldwide.
DAOs
DAOs are
providing a
path toward
community
governance
of any kind of
organization
©2022 Andreessen Horowitz. All rights reserved worldwide.
48
49
Source: https://deepdao.io/; Data is as of 5/12/2022.
DAOs have accumulated more than $10 billion
in treasury assets under management
DAO Treasury
Assets Under
Management
DAOs
©2022 Andreessen Horowitz. All rights reserved worldwide.
DAOs enable a new, bottom-up way
for groups to make decisions
51
Source: https://deepdao.io/, Data is as of 5/12/2022.
DAOs
©2022 Andreessen Horowitz.
All rights reserved worldwide.
web3
2022
State of
Crypto
Closing
Thoughts
52
©2022 Andreessen Horowitz. All rights reserved worldwide.
State of Crypto
An overview report
Two thousand twenty two
53
Crypto is already making a real world impact
01.
02.
03.
04.
05.
Today, there is vast
untapped lending
potential in emerging
markets. Goldfinch
expands access to
capital using crypto to
truly empower financial
inclusion.
Traditional web
services rely on
trusted intermediaries
(Facebook, Google)
to manage their users’
digital identities.
With Spruce, users
can control their
own identity with an
Ethereum account.
The telecom industry
is currently controlled
by monopolies. Helium
is building towards a
future where network
coverage becomes a
commodity, fueled by
competition, available
anywhere in the world,
at a fraction of
current costs.
Only 15,000 musicians
on streaming services
(less than 0.2%) make
more than $50K/year.
Sound cuts out the
middlemen, allowing
artists to monetize
directly from their fans.
The voluntary carbon
market lacks liquidity,
accessibility, and
price transparency.
Flowcarbon is
leveraging blockchain
tech to scale climate
change solutions.
©2022 Andreessen Horowitz.
All rights reserved worldwide.
Source: World Bank, Coin Metrics, and a16z analysis of public data on the Ethereum blockchain
Data is through 12/31/2021.
54
Internet Users vs. Ethereum Addresses
(Log Scale)
It is still
early days
for web3
State of Crypto
©2022 Andreessen Horowitz. All rights reserved worldwide.
State of Crypto
An overview report
Two thousand twenty two
55
What’s next for web3?
01.
02.
03.
04.
05.
Web3 infrastructure will
continue to improve,
with the continued
improvement and
Expect many more
creators to embrace
NFTs in their own
communities as
Expect many web3
games to launch,
developed by founders
with backgrounds
New web3 users who
earn tokens through
games and NFTs
will likely choose to
Expect many more
experiments with
DAOs, social tokens,
decentralized social
growth of nonEthereum L1s and
Ethereum L2s. The
Ethereum merge will
hopefully happen
this year. This will
improve performance
and also remove
the environmental
objection to using
Ethereum.
they discover how
much better they can
monetize by selling
digital goods directly
to their fans vs banner
ads and other web2
monetization methods.
at top game studios.
Some of these will
launch in the coming
months, others will take
longer.
save those tokens
in DeFi protocols vs
tradfi banks given the
better rates and user
experience, growing
the number of DeFi
users.
networks, web3 media,
and other emerging
categories. Some of
these might break out
in the same way DeFi,
NFTs and web3 games
did.