The Ethereum Economy

I’m excited to see the Ethereum economy continue to grow

My thinking is that buying/selling digital art as NFTs is just one of the first mainstream applications that has been enabled by the unique properties of blockchains. I say “one of the first” because cryptocurrency as money is the first major use case that’s been enabled by blockchains. Pioneered by Bitcoin of course.

And NFTs as art isn't the only thing NFTs can be used for. As Uniswap V3 has shown, NFTs can even represent LP pools. Or they can represent domains for your eth wallets (via ENS). My thinking is that this is still a new design space, and there will probably be more creative applications that implement the ERC-721 standard as time goes on that shows that it can be about more than art.

If NFTs as art represent a small sliver of what I think NFTs can and will do, I also think NFTs will represent only a part of the future thriving Ethereum economy. There's already hundreds of billions in Ethereum, but the Ethereum cryptoeconomy when compared to real life large and booming economies is still nascent.

I believe that what’s next for Ethereum is a thriving economy where you can participate by earning, spending, and exchanging crypto for goods. Those goods can be NFTs, or other things that haven't been invented yet. If you look closely, you can see that this is already happening and this has been happening for years. However, I think it'll continue to grow like crazy and that NFTs as they exist today will represent just a small sliver of the things you will be able to do.

This theory encompasses DeFi as well. A thriving economy needs a thriving set of financial tools for its citizens, and that's where DeFi comes in. So far, we've got NFTs, DeFi, and DAOs (which can be compared to companies in regular economies). We've even got the early markings of new governance systems.

People tried so hard to make buying things irl with Bitcoin a thing. A noble goal, but I think the reality of it is that the crypto economy is going to be its own, digital thing. It’s going to enable new situations where crypto is the only way to do it. Like buying digital art, domains for your wallets, and more things we haven't yet imagined. Stripe wants to increase the GDP of the internet, but Ethereum is creating an entirely new economy for the internet. One whose GDP (I believe) will dwarf every other country in size at some point.

We're just getting started.


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