What's the best first touch point for users into the realm of crypto?
|Brian Flynn||May 26|
The NFTY News tracks the ever-evolving narrative of how the mainstream will enter crypto through user applications. In each edition I explore non-fungible tokens, dApps, and the ecosystem affecting consumer crypto applications.
I’ve had a few friends outside of crypto recently ask what the best crypto-user applications are to try out. They weren’t really interested in using bitcoin for payments, but really much more interested in learning about new ways to earn crypto after learning about things like Coinbase Earn.
Most of them are gamers, so I thought I could point them in the direction of CryptoKitties and other blockchain games. After all, 25% of CryptoKitties users during the beta were completely new to crypto. If I could teach my friends about digital scarcity & cryptonetworks through games, maybe I could get them exploring the rabbit hole further.
The other path I could suggest was open finance - being able to earn and instantly put the assets to use and compound earnings.
I ran a poll on Twitter to see what people the general public thought to assert my assumptions:
I decided to start with games first, so I set them up on Dapper (so they wouldn’t have to worry about gas) gave them each $20 USD of ETH to start playing and breeding. And then I told them to start earning and try to double their money.
Turns out, none of them were able to figure out how to double their money playing CryptoKitties, but one of them found OpenSea and figured out how to flip NFTs on the marketplace.
If my original goal was to educate through blockchain games, I failed. But then I tried the second option. I gave them $20 USD of ETH on MetaMask and told them to earn only using a few applications (dydx, Set, Dharma). I consider these three to largely be the best to explain open finance.
The powerful loop that my friends discovered: you can now earn crypto and either a) lend it out and watch it grow overtime or b) turn it into ETH and leverage. Most of them have traded in the past but have never actually used crypto-native applications. Token Sets from Set Protocol blew their mind because they could just pick whatever strategy they believed in without having to worry about price volatility.
They were hooked. They didn’t have any interest in trading on exchanges, but wanted to learn as much as possible about open finance.
Overall, my friends preferred using Dapper over MetaMask because of account login/password, but as a first touch point they preferred open finance over blockchain games, even though they were big gamers.
My reaching conclusion is that open finance is a better first touch-point for new users into crypto in understanding how it works holistically. I think this has to largely do with Kyle Samani’s thesis of Ethereum becoming unbundled. If Ethereum is an unsolved puzzle, then open finance is creating the puzzle pieces to make the unknown picture come to life. The puzzle pieces are starting to fit together using open finance.
Other use cases like blockchain games are still creating their own puzzle pieces, but not making them fit together. The lack of metadata standards and lack of business opportunity on interoperability swung the decentralized pendulum to centralized layer-two scaling solutions, making crypto games look no less similar than what games looked like in 2005.
Blockchain games, however, are a better first touch-point for new developers into the realm of crypto because they can plug into an existing user base.
But that’s for next week.
Disclaimer: I work on helping create a world of infinite possibility at Dapper Labs. All opinions are my own and don’t represent the opinions of Dapper Labs.