What should you pay attention to in the crypto market in 2022?

Article author: Mario Gabriele

Original title: What to watch in cryptocurrencies in 2022?

If you only have a few minutes to spare, investors, operators, and founders should be aware of the most exciting crypto trends of the year.

Sovereign data could change the internet. Projects like Ceramic allow users to carry their data over the internet. The two contributors highlighted the open source protocol, describing how it could change the way we build and interact with on-chain applications.

Music NFTs are heading for a breakthrough. This could be the year of the ear, and if 2021 sees a surge in profile picture NFTs, 2022 could boost music NFTs. Musicians, fans, and vertical NFT marketplaces like Catalog can all win big.

DAOs can be used to solve difficult problems. DAOs can do more than simply bid on the U.S. Constitution; they could be how the next life-saving drug is developed. VitaDAO, which is dedicated to studying longevity, may prove to be a precursor to the budding “DeSci” movement.

The infrastructure phase is accelerating. The existing infrastructure has been struggling to keep up with the increasing adoption of cryptocurrencies. A better trajectory is needed to unlock the next phase of growth. In this regard, Pocket Network may prove to be indispensable. Multichain protocols facilitate decentralized cloud computing around the world.

Wallets go beyond transactions. Existing crypto wallets such as MetaMask have been built to process and track transactions. Increasingly, however, wallets are the place to track Crypto goods and experiences — an extension of identity that could benefit newcomers like Genesis.

DeSci explains: Making the entire process of decentralization or scientific innovation from publication to funding more open, visible and frictionless.

I believe it was February 2021 that I first heard the word “Solana”, and whatever the context might have been – a conversation or a skimming article – I can’t quite remember. If I go further, I might understand what Solana is, why it’s interesting, and actually, how much a token costs. I may have found it to be a new layer 1 protocol designed for massive speed, backed by some of the smartest builders and investors, and it’s priced at around $6.50.

The next time I heard about Solana was in late May, while walking in San Francisco, and Acquired’s David Rosenthal shared what he’s learned from it and why it’s so compelling. That was enough to pique my interest, but unfortunately not enough to buy anything. At the time, Solana was trading at about $27.

In August, I published a trilogy on the cryptocurrency exchange FTX. As part of this, I talked to some of Solana’s early adopters, including Sam Bankman-Fried and Kyle Samani, and Solana reached $33.

Two weeks later, my friend Packy McCormick published his article on the protocol. I finally bought my first Solana token for $70 and made regular purchases.

The reason I share this anecdote is not to show that I’m an idiot. (Although, in this case, I might be.) More importantly, it’s to illustrate how many times we can talk about a topic before it really sticks. Even if it comes from someone you admire and respect, it can take a long time to break the noise.

Today’s article attempts to shorten the process for all of us, and instead of waiting for the most exciting crypto projects and trends of the year to happen, I ask some of the most thoughtful people I know to share what they’re focusing on. Additionally, I’ve asked them to explain what energizes them about their choices to help us move beyond mere approval.

While this isn’t investment advice — if you want to justify the volatility of the industry, you just have to look back at the pullbacks of the past few days — by the end of this article today, I hope you understand what’s worth paying attention to this year.

Matt Shapiro, Partner, Multcoin Capital

Building infrastructure with cryptocurrency incentives

Cryptocurrencies are starting to touch the real world in interesting ways. The technological foundation of cryptocurrencies is advanced enough that entrepreneurs outside of cryptocurrencies with deep domain knowledge and expertise realize that it can be leveraged to disrupt incumbents or revolutionize or break the rules of traditional industries. The best example to date is Helium, which disrupts wireless networks by using cryptoeconomic incentives to facilitate the construction of real-world infrastructure.

Rendering networks are another exciting example that represent the fusion of Crypto rendering and encryption. 3D objects and photorealistic graphics in movies and videos are computationally intensive. With the advent of the metaverse, these virtual environments need to be created and rendered, along with millions of avatars and NFT accessories to populate the Crypto space. It would take countless hours of dedicated GPU time to make metaverse possible.

Cryptoeconomic incentives are ideal for attracting potential assets to mass production through new markets without marginal cost. The Render Network does exactly that and leverages the global potential of GPUs. Additionally, as Ethereum moves to a proof-of-stake consensus mechanism, we expect a whole market of GPUs to be readily available for rendering images and videos.

But the market is two ways. Simply organizing the supply side won’t work unless there is demand. Render Network is uniquely positioned due to its relationship with Otoy. The company has been at the forefront of rendering software for over a decade. Today, their flagship software solution, Octane Render, is widely regarded as a best-in-class GPU rendering solution. It is used by major movie studios including Disney and tens of thousands of Crypto artists including Beeple. Otoy provides an embedded user base for the Render Network, customers currently working on rendering elsewhere, including Amazon and Nvidia.

RNDR is a forgotten 2017 coin that is getting a major update. The token design is being updated to include staking and governance features. The rendering network is being migrated to Solana for speed and execution, and integrated with Metaplex. Other major rendering software solutions, such as Redshift, have joined the rendering network.

For these reasons, the Render Network is positioned as a core part of the infrastructure connecting web3 and Metaverse.

structured product

As DeFi grows, I’ve been looking at structured products. DeFi yields fell across the board as new capital entered the space to offset borrower demand. But new capital inflows have not slowed. They are increasing as traditional asset managers join in, looking to take advantage of inefficiencies and arbitrage opportunities.

Structured products are in an interesting position as more and more capital searches for yield and derivatives protocols continue to roll out. For example, the covered call option strategy is well established in traditional finance, but is often too complex for most retail investors to understand and execute quickly. The programmability of encryption removes this complexity, making it very simple (one-click) for long-term holders to generate returns on assets by writing covered call options.

This part of the market is growing rapidly and gaining impressive traction. This includes structured product protocols such as Ribbon and StakeDAO on Ethereum, and Katana and Exotic on Solana. Demand for these products also favors underlying options protocols, such as Opyn and Hegic on Ethereum, and Zeta and PsyOptions on Solana. It’s still early days, but it’s an area to watch in DeFi.

Li Jin, Co-founder of Variant

Common base capital for DAOs

Crypto will be a test bed for ambitious economic and social experiments that could create a fairer internet than exists in a web2 world.

Income inequality has risen in most developed countries in recent decades. The concept of Universal Basic Capital (UBC) or Universal Basic Wealth addresses structural inequality by giving people ownership of assets that appreciate in value. Examples include Alaska’s Social Wealth Fund, which pays dividends from the state’s oil revenue, and Singapore’s Central Provident Fund. The advantages of UBC over simply redistributing income are that basic capital can act as a safety net, improve bargaining power, empower entrepreneurial risk taking and focus on long-term goals, and ease financial anxiety.

As economists, executives and political leaders debate how to implement UBC on a larger scale, the DAO is ready to experiment here. According to DeepDAO statistics, as of December 2021, the total assets under management (AUM) of DAO treasuries listed on the platform was $16 billion, up from $400 million in January. A portion of these treasury funds can be earmarked for the DAO’s membership base and invested over time to earn yield. Members can then use these accounts for retirement, education, healthcare or start-up capital. The replies here include samples of DAOs trying to create a form of basic income or basic capital, including Worldcoin, $UBI, Impact Market, and smaller-scale experiments like FWB’s Artist Residency Grants or SuperHi’s Creative Essentials income.

Cryptocurrencies give us the toolsets to build new economies and societies. With that comes the opportunity to ask how we want these economies to work and what kind of societies we can create. I’m excited to see DAOs consider token design and financial strategy not only from a short-term user acquisition or engagement perspective, but as a foundation for a new, fairer world.

Aaron Wright, co-founder of Tribute Labs and LAO

great mix

In 2021, we see the emergence of web3 thanks to three overlapping core trends: DeFi, NFTs, and the shimmer of social tokens — all stitched together using the cartilage of DAOs.

In 2022, things will start to get weird. These three categories will continue to grow and get mixed up. DeFi will enter NFTs in terms of lending and staking. NFTs will flirt with DeFi mechanisms. NFTs will be bent into membership cards and social communities, with social tokens as the incentive mechanism within the community.

The DAO and the DAO Network will continue to thrive, supporting artists, creators, and novel financial products. They will enable more and more open source tools, IP sets, and more and more public goods. Tools (especially DAO tools, bridges, zk-tech, messaging, privacy, and storage) will improve and begin to mature, unlocking more and more ways for people to cooperate in emerging multiplayer modes.

Millions, if not more, will join cryptocurrencies through NFTs, opening up new categories of collectors. NFTs will no longer be limited to PFPs, game items, virtual worlds and Crypto art. They will start eating other forms of media (with no obvious headwinds) like fashion and music.

Who knows what will happen to the price, but if the web3 ecosystem can attract more capital, the wealth it generates will increasingly be used to solve harder problems, such as decentralized science and climate change.

Annika Lewis, Head of Gitcoin Grants Project

Ceramic

Data is everything. It’s a valuable asset in itself, as evidenced by the rise of companies like Facebook and Google. Both companies have become one of the most profitable businesses in the world thanks to the data they harvest from billions of users.

A macro shift in data ownership and value capture is underway. Web3 brings what I call “de-platforming of data” – that is, the decoupling of the application and data layers. These parts are usually fused under the ownership of a single entity. The deplatforming of data will enable user-controlled data storage: a paradigm shift for users and developers.

No one has embraced this radical shift better than Ceramic. Ceramic is an open source protocol for decentralized applications that is building data rails for web3. For developers, it enables them to build applications without the underlying trusted centralized database server that has long been required. Ceramic breaks down data silos for end users, allowing them to transfer data across platforms. By doing so, it puts data control in the hands of the user.

Ceramic is rapidly gaining adoption, and notable projects have been built on the protocol. With an incredible team and a huge blank canvas of problem space, Ceramic is one to watch in 2022.

Ken Deeter, Partner, Electric Capital

Multichain and 2.0

Last year saw a major change in multi-chain narratives. Ethereum Virtual Machine (EVM) compatibility and high transaction costs on the Ethereum mainnet allow competing chains to attract applications and users. However, most of the activity I see is copy-paste activity – forks and imitations of successful Ethereum projects, with positive liquidity incentives.

In the long run, successful competitor chains will attract new types of applications that all outperform Ethereum and take advantage of the unique architectural advantages of different chains. We are starting to see examples of games and NFT marketplaces being developed locally outside of the Ethereum mainnet, but this area is just getting started.

DeFi tokenomics renaissance

Protocol-owned liquidity, voting locks, bonds, curve wars – the DeFi ecosystem has seen rapid innovation in economic design around governance tokens. Best practice sets for these protocols are rapidly evolving. Thanks to these more favorable designs and incentives, new protocols can quickly gain market share. Early-stage DeFi projects are reassessing and restructuring their core economics in light of recent innovations. Communities are being disrupted and realigned. Over the next year, I think we will see a clear distinction between protocols that can adapt and integrate these new mechanisms and those that remain stuck in the old ways.

Gaby Goldberg, investor in TCG Crypto

wallet as identity

The wallets of 2022 will not be crypto wallets. They will be native web3 wallets – built for identity, navigation, personalization and media.

To date, all wallets have been built and designed around transactions. Many wallets have been in use for over three years and were created specifically for buying, trading and holding tokens. Since then, the purpose of the wallet has changed as the ecosystem has continued to expand. As we move into the web3 – a more social, open and interoperable internet – we see an interest in wallets as a place to store NFTs (see Rainbow or Coinbase Wallet) and multimedia experiences (see Glass, Sound and Altered State Machine) increasing demand). In short, wallets are becoming a place where people want to spend their time. Existing wallets will not (and frankly, cannot) accommodate this new behavioral preference.

When we consider how this ecosystem-wide shift might occur, we can examine the factors driving user adoption of wallets that have previously achieved mass scale. As a case study, MetaMask had 545,000 monthly active users (MAUs) in July 2020. By August 2021, this metric soared to over 10 million, driven by a surge in interest in “DeFi Summer,” in which yield farming acts as a consumer. At the time, consumer use of MetaMask to capitalize on DeFi gains was an obvious choice, as MetaMask was more accessible (and widely supported) than its competitors.

We can draw parallels between this example and today’s web3 ecosystem. The supply of NFT projects, new yield farming opportunities, and social web3 platforms are all at all-time highs and growing. Traditional wallets will initially consume new demand. But as the variety of applications, use cases, and behaviors expand, users (and developers) will need more support for integrated wallets that leverage on-chain provenance and transfer your Crypto identity across applications and chains. For these reasons, I am excited about wallets like Genesis, Bitski, and Sudo.

My brilliant friend and investment partner Jay Drain said it best: “Right now, crypto wallets look a lot like inventory… In the future they will represent our Crypto identities more clearly by making them composable on the web.” I I suggest you check out his full work here.

True Ventures investor John O’Connell

Stader Labs

One project I’m excited about is Stader Labs. Stader is creating the “Amazon of Staking” – allowing users to easily stake their cryptocurrencies and earn passive income through a variety of strategies based on user preferences.

Launched on Terra, Stader allows users to automatically combine their LUNA staking rewards to maximize returns while distributing their assets to a variety of different validators to encourage further decentralization across the Terra blockchain. Stader also launched LunaX, a liquid collateralized derivative of LUNA that allows users to interact with other DeFi applications in the Terra ecosystem.

Today, Stader manages around 6.1 million LUNAs (worth around $490 million at the time of writing) across different strategies. In the future, Stader plans to launch similar products on other blockchains, including Solana and Ethereum. They will also introduce advanced strategies to further enhance the usefulness of their platform to their growing community (disclosure: True Ventures is an investor in Stader).

change state machine

Another project that excites me is Altered State Machine (ASM), which is building a protocol to add enhanced AI capabilities to NFT projects. ASM recently abandoned a project called “Brains”. NFTs are unique artificial intelligences that can be trained and used in different ways.

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For example, ASM launched the Artificial Intelligence Football Association (AIFA). Holders can use their brains to participate in AIFA’s money-making video games with special “All-Star” characters. As brains are used in games like this, they develop skills and abilities that will make them even more useful in the future. Users can also passively train them using ASM’s simulation modeling technology.

In the future, Brains will be able to be used in other DeFi, gaming and crypto environments. Holders will even combine Brains to mint NFTs, allowing newcomers to join the ecosystem (disclosure: True Ventures is an investor in ASM).

Andy Weissman, USV’s GP (fund manager)

Crypto fashion

I am very curious to know what to expect in the ever-evolving world of Crypto fashion. Digital identities clearly matter – 4.5 billion social media consumers are already using Crypto identities and personas. As Dani Loftus, founder of Crypto studio Draup, writes:

The characters that form the basis of your identity are not curated from your physical life, but created entirely Cryptoly, giving you the opportunity to express yourself in entirely new ways.

What new forms of self-expression will emerge? What new tools and platforms will be invented for emerging designers? What new ways to dress, share, sell, distribute? What happens when you mix these concepts with the core principles of web3 – composability, transferability?

I’m looking at some names: Dani Loftus, UNXD, DressX, The Fabricant, Artisans, Charli Cohen, RED DAO, and XXXXTH (note: some of these great people are my friends!).

Jackson Dahl, Entrepreneur-in-Residence at Paradigm

The rise of pseudonyms

I’m glad more people are exploring and building pseudonym tools, especially in the context of web3. While the internet has been dominated by real-name identities for the past decade, I believe we are entering a new phase during which pseudonyms will become common, if not dominant, in many media. It is worth noting that while pseudonyms have privacy and security reasons (discussed extensively by Balaji Srinivasan), there are other significant impacts, including social dynamics, identity expressions, culture, celebrities, and more. Perhaps most importantly, pseudonyms allow identities to be contextual rather than fixed. In this respect, unlike anonymity, pseudonym is a scope and a broad design space.

The last year has seen an increase in anonymous influencers in the gaming and crypto space, from well-known creators (Dream, Corpse Husband, CodeMiko) to more niche but highly engaged thought leaders in NFT-based identities (Gmoney, Punk 6529, 4156). There are also examples in art and fashion. We’ll see more people joining this cadre; people will use multiple identities, just as some identities will be made up of multiple people. We’ve seen massive pseudonyms on platforms like Reddit, Discord, Tumblr, and even some parts of Twitter and Instagram.

This trend has no clear connection to web3. But NFT identity, on-chain reputation, decentralization and composability are critical to its development. As we live more and more of our lives in Crypto spaces, I hope that flexible identities will be an important factor in shaping an ideal future, just like cryptocurrencies and property rights.

Richard Chen是1confirmation GP 

Vertical NFT Market

OpenSea is the biggest winner in our portfolio. While it will continue to be a generational company and the dominant secondary market for NFTs, I believe specific verticals will carve out niches with better UI/UX, search and discovery capabilities. SuperRare is a successful example of high-end 1/1 crypto art, but there will be other examples in categories like Photography (Sloika), Metahood (Metahood), and Music (Catalog).

I’m going to highlight Music NFTs in particular, it’s surprising that Music NFTs haven’t exploded, unlike other categories like fine art, collectibles, and games, but I feel like collectors’ tastes are changing rapidly. Leading music NFT marketplace Catalog had a breakout month in October, with a volume chart reminiscent of what I saw before the crypto-art explosion in SuperRare in early 2020. For music, it’s a question of when and not if.

0xStation co-founder Tina He

The birth of a new “city”

In 2022, we will relearn the relationship between our identities, contributions and relationships on the Internet. The most interesting assets are those that create an environment that strengthens our understanding of our new self.

Psychological undercurrents have been converging at this point for some time. Both web2 and web3 startups are riding the waves from different directions and with different vehicles. Both argue that the democratizing power of tools enables mass consumers to participate in economic activities once controlled by a few institutions or corporations.

Reality is becoming more and more diverse and transcendent. It’s just the “everyone is an investor” rhetoric that spawned two big bets on startups; party rounds and syndicates are two manifestations of the same belief. For some newcomers, status as an “investor” must be achieved through “contribution”—whether it’s rising up the ranks and becoming a thought leader in mirror writing competitions, or discovering a tactical niche for intellectual compounding. Those who invest together come together to discuss more investments, cultivating fertile land, and new social interactions around co-ownership of assets.

The “software is eating the world” rhetoric is still playing out at scale in web2. For most web2 companies, a coherent, smooth, and enjoyable user experience abstracts away the legal plumbing and institutional adjustments accomplished by SLAs, laborious data digitization, and standards harmonization. For web3 companies, these agencies are being created as entirely new entities and rapidly gaining legitimacy. The former will fight for consumer attention, while the latter will fight to build guardrails of legitimacy and invite a whole new working class to help them get there.

The most exciting trend for 2022 will be to see how the story of this many cities unfolds – giving birth to a new class of workers, citizens, leaders and infrastructure. ‍ – Find Tina here

Cooper Turley, full-time DAO

Music NFT

Ranging from independent artists like Daniel Allan and Haleek Maul to Nas and 3LAU. Artists are tagging audio files across the board, giving fans a way to collect their favorite songs or records. Here are some market leaders:

content. As the premier 1/1 music NFT marketplace, Catalog is the first major platform to tag audio files by building on Zora. It features a variety of established artists, up-and-coming performances, and Genesis Records. To date, Catalog has sold over $2 million in records and has become a cornerstone of the music NFT movement.

sound. Hosting a listening party has never been more satisfying. Sound lets musicians share new music by posting a set of numbered NFTs, allowing listeners to support their favorite artists. Early versions are considered more valuable than later versions and can inspire discovery. So far, Sound has held 29 full-seat audition sessions in a row, all of which ended within the first minute of going live. As the secondary market continues to evolve, Sound deserves close attention.

royal. Earlier this week, Royal launched its first product, enabling fans to collect NFTs by claiming royalties directly. By enabling credit card transactions, Royal appears to be attracting many non-crypto natives — 40% of participants joined the decline using this method. For those new to web3, Royal offers a promising solution.

In addition to music NFTs, the field also includes a growing number of labels, agencies and collectives coming together to collect music. Whether you are a fan, degen or artist, there is something for everyone.

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DAO ecology

Hanel Baveja, USV investor

Emergence of DeSci

To reimagine the structures that make drug development obscure and dislocated today may require a completely orthogonal, non-obvious point of view: DeSci.

DeSci makes the entire process of decentralization or scientific innovation from publication to funding more open, visible and frictionless. It broadens the idea of ​​how to be a new scientific IP stakeholder and brings together more new IP to the world through DAOs and other web3 structures in new ways by aggregating resources – people and capital. Perhaps DeSci’s most radical vision is to empower new and larger stakeholder groups — patients, researchers, and enthusiasts — with positive market effects, resulting in cheaper, better products for all.

There are already several interesting projects in DeSci, including Molecule, VitaDAO, and other details. I have more questions than answers for this emerging category, which makes me even more excited about what’s to come.

Alexis Ohanian, founder of 776

Boring Ape Yacht Club

As an early ape holder, I’m biased, I’ve turned a lot of people from my old co-founder Garry to my own wife (I bought her as a gift), but I think we’ll be out of BAYC in 2022 Getting more This resets our expectations for the capabilities of NFTs x Culture.

Maria Shen, Partner, Electric Capital

DAO as a new subsection

The Internet removes geographic boundaries, allowing communities to form around any interest, no matter how niche. Crypto unlocks the ability for anyone to create coordinated systems at scale.

The DAO leverages both the internet and encryption to enable tribes of strangers to use a pool of resources for a common purpose. With DAOs, people can now pool resources together and decide what to do with those resources through a governance process. The rate at which DAOs are being created has grown exponentially — what started as a trickle of one or two new DAOs per day has now turned into a torrent. The largest DAOs control multi-billion dollar coffers, issue grants and employ large teams. In contrast, the smallest DAO can be a group of friends who gather resources to buy NFTs.

DAOs provide jobs, donate to charities, fund initiatives, contribute to political movements, and throw big parties. In the future, we may have as many DAOs as there are subreddits—in addition to forums, these organizations will be able to direct resources toward ideals they care about.

David Phelps, co-founder of Ecodao

Ceramic

If you were an academic in the years before the printing press, chances are you were also a navigator— neither reading nor lecturing most of the time, but traveling between libraries to study and copy books. You moved, but the book didn’t. Of course, the printing press changed all that: now books can move, so you don’t have to, and centuries of revolution will follow. But for all technological advancements, in today’s internet, we’re mostly preprinters. We cannot transfer the people we follow, the types of media we like, the reputations and audiences we build—our data—as platforms. Like academics, we spend our time moving between platforms; media on those platforms doesn’t.

What happens if our data is transferable? We should see at least four major social consequences:

1. People can track the impact of creative works being shared, used and monetized across the furthest reaches of the Internet.

2. People will share more data with the platform to improve performance and recommendations as it improves their experience across the web.

3. People will be incentivized to contribute to public datasets that yield better analytics and social graphs for platforms to innovate on. AI can use this information to automate many of our daily online tasks.

4. Platforms will race to get users to move their data and audiences from one venue to another.

In other words, data portability represents a huge social shift in shifting power from platforms to users. Or rather, data portability shifts power from platforms to protocols, as users can only manage and transfer their data on common tracks that standardize, validate, and stream that data. Platforms must be built on a common data rail to leverage each other’s content and audiences. Nonetheless, as Joel Monegro suggested a few years ago, as users move their tokens, NFTs, content, followers and reputation from one to another, they also lose moat. At the same time, the moat of the data protocol is getting thicker in letting users port data first.

This behavior is what Ceramic implemented when developing the dataflow blockchain, allowing us to own our own data. This means we can monetize our data, set automatic commissions when anyone uses it, and get rewarded from competing to win our platform. For that matter, we can also track and demonstrate the impact of creative work: imagine writing a song that not only gets paid when others play it at an event to earn money, but also allows others to recreate it without permission. Remix, and the proceeds flow back to you, while collecting data on its usage that you can use to find career opportunities while connecting with others with similar tastes. In web3, our ability to manage data will allow us to manage our entire lives online. NFTs are just a front end to how we are seen as data in the metaverse.

If the 2010s were the decade of distributed ledger technology (DLT) enabling sovereign finance, the 2020s will be the decade of all types of sovereign data. We can go back to our ancient scholars, wandering between libraries in a vain pursuit of sharing and translating each other’s texts so that the libraries might end up being similar to each other. In the less poetic web3 data stack, Arweave is like a library, hosting books, while protocols like The Graph and Kyve are like librarians helping index and query the books we need.

But Ceramic is unique, not only because it provides common rails for the platform, but because it allows us to write books in the library in the first place. Providing tools to own and manage our data gives us the incentive to collect and create new types of data that may even exceed our imaginations. That’s the huge potential. Not only can we have our data online as individuals, but we can be rewarded for sharing, collectivizing, and reorganizing it in new public social structures that we have not yet fully conceived.

Chase Chapman, co-founder of Decentology

Token Weighted Voting

With DAOs becoming one of the de facto structures in web3, with large sums of money and millions of members, the stakes are much higher to get things right. All of this makes organizational design failure in a DAO a considerable risk.

Token-based governance is a well-documented organizational design failure. Not only can tokens be purchased and used to manipulate votes, but token-based voting systems do not take into account the field of expertise. For example, individuals with marketing expertise should have more power in marketing decisions. This failure leads to dilution of expert knowledge.

In 2022, I expect to see significant experimentation in governance, slowly moving away from token-based voting to other mechanisms for distributing governance power based on merit, the context and expertise required for decision-making. As tokens become less important to governance, DAOs will be forced to ask themselves what the intrinsic value of tokens is, which may be a forced function of exploring new mechanisms that give tokens value beyond governance powers.

Brian Flynn, Co-Founder of the Rabbit Hole

0xStation

If we’re playing great online games, the next level of gaming is exchanging Social Points for Contribution Points. I think 0xStation will play a key role in this transition. The project is building the infrastructure to connect talent with the right projects in web3 to help members of the new economy work and play. As these individuals develop and participate, their achievements will be displayed on the blockchain, creating a log of skills and abilities. Over time, I expect on-chain reputation to replace social status on sites like Twitter, better demonstrating the value of specific individuals and the work they have done, and 0xStation will be a place to watch.

Julia Lipton, Founder, Awesome People Ventures

Syndicate

I continue to be bullish on DAOs, it is still early days, but it is clear that DAOs will open up new types of organizations, projects and investments that were not possible before.

A key player in this space is Syndicate. They make it very easy to create investment groups. Communities are formed overnight to invest in NFTs, DeFi projects and even startups. Looking to buy a 100 cryptocurrency squad or run a DeFi investment fund? Interested in angel investing with your friends? Syndicate is probably your best bet.

Setting up a traditional investment fund is expensive, laborious, and legally complex. Syndicate enables projects, friends, and trustless communities to coordinate funds for investment almost instantly. We’ll continue to see new ways of coordinating labor and capital in 2022, and I’m excited to see what happens next.

Fiona O’Donnell-McCarthy, Investor at True Ventures

JellyFi

I’m excited to introduce two projects with incredible female co-founders, the first being JellyFi, which provides an easy source of liquidity for other DeFi projects. They offer undercollateralized loans compared to the typical overcollateralized loans we see in DeFi today.

Their clients are audited institutional borrowers (DAOs, dApps and DeFi protocols) who use liquidity like a revolving line of credit. This structure allows lenders to earn higher returns than overcollateralized DeFi lending platforms.

This excites me because it provides an easier and more efficient form of credit for the ecosystem. This will become increasingly important as high-potential DeFi projects experience growing pains or need to weather temporary setbacks.

JellyFi was founded by four ConsenSys alumni, including Charlotte Eli, who worked on the decentralized derivatives trading platform while at ConsenSys (disclosure: True Ventures is an investor in JellyFi).

dematerialized

While cryptocurrencies are currently dominated by men, many female-led projects are capturing our attention and imagination. Dematerialized, the Net-a-Porter of the Metaverse, is one of them. They collaborate with existing fashion brands and web3 artists to curate and launch Crypto and ‘physical’ fashion. I bought my first phygital garment (boots with 3D NFT) from The Dematerialized in 2021. Boots are definitely cooler than me.

Otherworldly merchandise aside, I love two key things about this project: its mission to address waste in the fashion industry by shifting consumption to Crypto platforms, and its commitment to attracting and guiding new people through a familiar user experience Users use cryptocurrencies.

DAO focuses on gender diversity

The promise of blockchain technology is one of decentralization and dismantling of traditional power structures, yet we still see significant gender differences in the web3 world. HER DAO is a collective of women, trans and non-binary developers. Their mission is to increase the representation of the field and ensure that there are different perspectives when building revolutionary web3 products. One of HER DAO’s many initiatives includes scholarships for self-identified women to attend major conferences like ETH Denver.

The Boys Club is focused on supporting women and non-binary people anywhere on the journey from crypto-curious to total regression, and they are transitioning from club to DAO. I am so impressed with their ability to attract people into the field and encourage senior web2 talent to consider a career in web3, I highly recommend you join their Discord or follow them on social media (Instagram and TikTok).

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