Blockchain, Web 3.0 and the future of the Internet
On a hot August morning in 2013, I had a meeting that changed my life.
The topic of discussion? How bitcoin would change the world.
While I was having breakfast with venture capitalists and hedge fund traders, our featured guest Barry Silbert spoke.
I learned that day that Barry and I share more than a love of bitcoin. We both started at Salomon Brothers in the late 90s. I was in bond trading and he was on the other side of the firm in asset management.
After Salomon, Barry started Second Market, a popular exchange for pre-IPO stocks. As the past decade of venture capital activity has shown us, Barry has a knack for spotting big opportunities.
He said very clearly: “I have invested a significant portion of my net worth in bitcoin, and I believe this will one day become the world’s global reserve currency.”
At the time, this was borderline insane.
Bitcoin was still trading below $100 after falling from over $1,000. Very few people took it seriously.
Criminals used it to buy illegal goods on dark web sites like Silk Road. It was difficult to invest in for everyday people, and impossible for financial institutions that had to follow rules. Even if you managed to buy it, people got hacked and exchanges imploded left and right.
But despite all that, after hearing Barry’s pitch…I knew I needed to learn more.
If this was going to be the next big thing, I didn’t want to miss it. But I also wanted to test it out first.
So I bought 2.5 bitcoins for $250. I even found the transaction receipt, right up until the second I placed the order.
And I wish I had bought a lot more.
Over the next few years, Barry managed it.
Bitcoin Exploded! It went from $100 on that August day to $20,000 in 2017 – a gain of 19,900%. It was the peak of the “bitcoin craze.”
Barry founded the Digital Currency Group two years after our meeting… which, through its subsidiary Grayscale, eventually introduced the first ever bitcoin investment tool to the stock market.
But the rise of bitcoin was just the start of the crypto revolution.
Since it broke up 14 years ago, thousands of cryptocurrencies have emerged. Each has different uses, but they all share a common theme: trading without a middleman.
Today, like Barry did 10 years ago, I’m going to stick my neck out and say something you might think is a little crazy.
Investing in cryptocurrency now is like investing in dot-com companies back in 2004.
If you had bought eBay, Google or Amazon at the time – after they collapsed from their highs – you would have made gains of 248%, 3,400% and 4,200% respectively.
I’m picking these three companies because they were all launched during the bubble and are still going strong today. They were the “next generation” technology companies after the “first generation” Apple and Microsoft that came before.
Like them, Bitcoin was the first generation of crypto.
As this technology matures, the next generations of cryptocurrencies are going to be life-changing – and incredibly profitable.
Here’s what I mean…
Why Blockchain & Web 3.0 is a big deal
The reason I am so bullish on bitcoin and many other cryptos is because of blockchain technology.
If you don’t know much about blockchain, just think of it as a digital ledger that ensures the accuracy of transactions with computer code.
Every platform built on a blockchain has a native cryptocurrency. These are used to keep track of who owns what within the specific network.
Since each user’s history is stored on the blockchain, you can trade with anyone in the world without an intermediary or centralized entity to approve. Anyone can see any transaction at any time, and this shared record effectively replaces the middleman.
This system is extremely secure. It is actually considered impossible to hack, because a hacker would have to change the transaction history of every computer on the network to do so.
But blockchain technology is not just an alternative payment system. It is also set to give us more control over our private data.
In fact, it is set to drive a trend that I expect will massively disrupt every facet of our lives.
Everything from property, insurance, healthcare, energy, supply chains, the authorities – you name it.
This movement is called Web 3.0 — the third, newest generation of the Internet.
Before I define exactly what it is – and how blockchain powers it – let’s look at how we got here.
Do you remember dial-up modem? When you had to have a phone line to connect to the internet and it took hours to download a song?
It was Web 1.0. In this era, large companies such as Microsoft and Yahoo controlled the internet.
Web 1.0 is largely known as the “Read” version of the internet. This is because regular users could only read what big companies put on the internet, don’t add or engage with it in any way. It was also not easy to talk to other internet users outside of e-mail and instant messages.
Then came the rise of content generation, interactive web applications and social media. Seemingly overnight, anyone with an internet connection can create their own blogs, share their party photos on Facebook or their political opinions on Twitter. Instead of just “Read”, the internet became “Read and Write”.
This was Web 2.0. This phase of the internet also unleashed innovative companies with massive market capitalizations. It enabled podcasting and music streaming (Spotify), vlogging (YouTube and TikTok) and social media (Facebook and Twitter).
With that innovation came the long tech boom we’ve seen since the market bottomed in 2009. And some analysts estimate that the Internet has generated $10 trillion of economic value since its invention—thanks in large part to Web 2.0.
But while Web 2.0 sparked a brave new world of investment, it came at a price: our personal data.
In Web 2.0, user data became the world’s most valuable commodity. It allowed Big Tech firms to control the internet. And their algorithms had one mission: to capture your attention by choosing what to read or watch.
Don’t get me wrong. Gmail, Airbnb, Twitter and the like are useful platforms. But the downside is that Big Tech companies like these now have access to our likes, photos and even private conversations. And they get to decide what their algorithms show us.
That’s why the world is ready for the next generation of the Internet — Web 3.0.
The biggest change Web 3.0 will bring is the way we recover our data.
Instead of centralized companies controlling the internet – Amazon, Facebook, Google – we’ll be able to keep our own data and share it only when (and if!) we want. It adds an “ownership” layer to the reading and writing capabilities of Web 2.0.
And what is the technology driving this revolution in digital privacy?
That’s right – blockchain.
That’s why I get confused when I hear others say “Oh, bitcoin is a scam” or “Crypto is just to make the scammers richer”.
Being anti-crypto in 2023 is a lot like being anti-internet in 2004.
Sure, is crypto dangerous in the wrong hands? Absolutely.
But to be fair, the same can be said about the internet. And that didn’t stop Internet companies like Amazon, eBay, and Alphabet from racking up huge gains over the past 20 years.
So, here’s the thing: You don’t have to “believe” in crypto to get rich from it. In fact, you don’t even need to understand everything about it.
That’s why I’m here.
Crypto’s turning point
Everyone loves to beat crypto. In fact, bitcoin just celebrated its 14th anniversaryth birthday – despite being pronounced dead 471 times of all from Forbesto Bloombergto New York Times.
With that kind of track record, the mainstream media clearly doesn’t know what they’re talking about.
I have been following cryptocurrencies for the past decade. I founded and currently run a trading service dedicated to crypto trading. At this point, I eat, breathe and sleep crypto.
And I tell you, crypto is not death. In fact, it is about to enter a new bull market.
And today I’m revealing the two indicators I follow that tell me it’s time to get back into crypto.
If you want to watch my webinar and get the facts yourself, just click here.
And afterwards I want to hear from you. Email me at [email protected] and let me know two things:
- Are you bullish or bearish on crypto?
- If you are completely “anti-crypto”, tell me why. Do you think it’s a scam? Think the basics aren’t there? Don’t hold back.
I will write in this Sunday’s Banyan Edge article. Who knows – maybe your feedback is the one I’ll come up with!
Greeting
Unless you’ve been living under a bridge, you’ve probably heard of ChatGPT, the new artificial intelligence chatbot launched by Microsoft-funded OpenAI. I’ve spent the last week playing with it. And honestly… it’s scary what this thing can do.
Think Google’s knowledge base…but instead of finding you a list of websites in response to a search, it effectively scans all known information and summarizes it for you, even expressing opinions. And it learns from your follow-up questions.
Just for giggles, I asked it to write a 400-word essay on the rise of Napoleon Bonaparte. It provided a good but not necessarily unique summary that looked like it came out of a well-written encyclopedia. I expect something similar from a college story.
But this is where it gets interesting. In response to the essay, I asked it to explain how Napoleon led to the rise of Adolf Hitler.
And in seconds it described how the rise of Napoleon coincided with nationalism, militarism, centralization of power, expansionist policies and total war… all of which defined the rise of Nazi Germany. It was an explanation I would have expected from a PhD candidate.
Me too actually started going down some obscure rabbit holes. I asked my sister AI module, Dall E, to create a picture of Napoleon Bonaparte that looked like a Picasso painting. And it did.
Now I’m just playing with this. A computer-generated image of Napoleon that looks like it was painted by Pablo Picasso is a fun conversation starter at a party, but hardly anything of value.
But then…
I had a drink in Playa del Sol in Peru last week with a friend who happens to be the head of marketing for a large telecom company in the region. He told me that he started playing with OpenAI’s toys … and ended up creating a marketing campaign that went viral.
A task that would normally take six weeks for a team of marketing people to put together was done in a matter of minutes by one man doodling on his laptop.
Consider the potential applications as the properties improve.
Coding projects that might have taken teams of software engineers can be done by one or two. Legal briefs that might have required an army of lawyers to put together can be written by a single lawyer and a chatbot. For all you know, the next issue of Banyan Edge could be written by ChatGPT…although I’d like to think we’re a little harder to replace.
We are on the verge of a productivity explosion. This will create opportunities we cannot even imagine.
And this huge shift is happening just as the internet is transitioning to Web 3.0.
Make no mistake, AI will be a big part of the Web 3.0 story.
Right now, the most direct exposure you can get to AI is through Microsoft (MSFT), with its recent $10 billion stake in OpenAI. But don’t be surprised to see opportunities in the cryptocurrency space emerge in the coming years.
Ian King is the most connected crypto researcher I know and he just released a new presentation on what he calls Crypto’s Turning Point.
Ian believes that right now is the time to prepare for the next crypto bull market. Find out why right here.
Greeting
