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use cases

big ideas that are often used as the basis for other use cases

1. stablecoins let people store, move and collect value globally, 24/7 and without volatility

definition: a token issued on a blockchain with stable value relative to a benchmark
fiat-backed = tokens with stable value relative to fiat currency.
crypto-backed = tokens with stable value relative to cryptoassets.
algorithmic = tokens with a stable value relative to cryptoassets, managed with software.
examples: USDC, USDT, USDP, where $1 = almost exactly $1.
benefits
customer acquisition
a new investment class
an account everywhere
compared to other cryptocurrencies, stablecoins are less volatile
and function in a global, 24/7, near-instant settlement process.
deposits are stable and generate high yield, allowing for trading with stable pairs
easy USD remittances and savings where local currencies are unavailable.
use cases
store value
make and collect payments
high-yield “savings” or treasury
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2. decentralized finance = DeFi lets users save and lend without the need for intermediaries

definition: applications with similar functions to other financial services, without a single institution in the middle.
DeFi refers to applications implemented using smart contracts.
examples: AAVE, Compound or Uniswap use algorithms to set deposit and lending rates.
benefits
digital ownership
a new investment asset class
user rewards
investors benefit from higher returns,
allowing for borrowing and lending at variable or fixed rates without an intermediary actor.
they can also combine various DeFi protocols to create advanced return profiles.
use cases
saving and lending without the middleman.
traditional lending
DeFi lending
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when you save in a bank,
you’re lending money to the bank.
“saving” is lending to other wallets
through a protocol to a liquidity pool (LP).
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they take your money and lend it to someone else,
making money from the difference between
the interest it pays you and the income it makes
from having lent your money out at a higher rate.
the protocol sets a price for someone else
to borrow that asset and collects fees
for connecting lenders and borrowers directly.
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this income minus any fixed costs is the bank’s profit.
banks have high fixed costs
from staff, buildings, technology etc.,
so returns are low.
it makes a profit from those fees minus its fixed costs,
of which there are almost none.
DeFi protocols can also reward active users
by issuing “shares” (governance tokens).
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3. non-fungible tokens = NFTs offer provably unique tokens with functionality

definition: a non-fungible token that is provably unique, and the wallet address ownership is publicly verifiable.
NFTs are tokens that are not interchangeable with one another, like real world collectibles.
a BTC is fungible → 1 BTC = 1 BTC
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if you send me 1, and I send you 1, we’re in exactly the same place we started (minus fees).
most things are not
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NFTs are tokens that are provably unique
while the image can be copied, only one wallet can have the token on its blockchain at any one time.
developers can then use the wallet + token + blockchain to do new things,
e.g. only the owner of that token can access new online content, or a real world event.
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examples: Cryptopunks, Bored Apes and Generative Art.
benefits
new marketing models
new ways to earn
a CRM for assets
NFTs embed functionality in art (royalties paid whenever a token is transferred, for example).
they're also provably scarce,
which means pieces can be continuously used or transferred even in the absence of their issuer or developer.
use cases
ownership and access
art with functionality
where uniqueness and digital scarcity are required, they enable a number of different use cases.

4. decentralized autonomous organisations = DAOs = new org structures for global problem solving

definition: a decentralized autonomous organisation is a collective of people aligned around a shared purpose,
using blockchain networks to coordinate, vote and build solutions.
DAOs create a new labor relationship between entities and contributors.
they’re managed through governance tokens and enable a different kind of community tool for companies and organisations.
examples: LinksDAO, KlimaDAO, TalentDAO.
benefits
customer acquisition
shared ownership
new competitive moats
new marketing approaches
DAOs are borderless, allowing anyone to participate in developing and growing the community.
they’re also openly governed, so that any member can vote on what the DAO can do.
use cases
investing clubs
social clubs
open source software development
the new economy type of business
as talent is becoming more mobile and wants to work on subjects that have meaning,
DAOs present a compelling way to do that.
DAOs create organisations where decisions are made with complete transparency,
and anyone who contributes receives ‘tokens’.
while tokens aren’t shares in a company, they can offer a lot of value to users
(like the ability to invest in NFTs (”the company”) early,
discounts, access to new products and more,
and if the DAO is popular, the price can also appreciate).
companies
DAOs
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each industry has its own regulatory framework
corporate governance
administrative overheads
roles and responsibilities are fixed
change and growth sometimes slow
membership is as easy as buying a token
work is aligned to members’ skill sets
governance is based on voting
often solves problems businesses would leave behind
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5. facilitating value transfers → crypto and stablecoins offer another payment rail

definition: paying or getting paid using stablecoins may be preferable, faster (and in some cases cheaper) than traditional rails.
benefits
customer acquisition
a new investment class
an account everywhere
faster, automated payments that can generate yield or income, running globally, 24/7.
programming to pay or be paid can be done cheaper and with less friction.
anyone with a web3 wallet can collect a compatible stablecoin in near-real time.
often being paid in stablecoins allows non-US consumers and businesses to hold a stable asset vs their home currency,
and also generate a yield (% return).
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use case
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stripe released “Crypto payouts”, which allows merchants to get paid in stablecoins.
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their first partner, Twitter, allows creators and influencers to be paid in USDC, one of the top US dollar stablecoins.
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visa has implemented stablecoin clearing for merchants and recorded over $2.5B of payments made using crypto-backed cards in the first quarter of 2022.
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6. transparency → real-time auditability and transparency creates new analytics

definition: the availability of all transactional data on-chain allows for more advanced types of monitoring
and the creation of data services.
near real-time analysis creates opportunities for actionable insights at individual and market level.
every transaction posted on a blockchain network can be seen in real time.
that makes real-time fraud, anti-money laundering (AML) and sanctions detection and reporting possible.
benefits
better data
new product and revenue
my data follows me
these solutions are capable of on-chain AML and KYC, of producing near real-time financial and regulatory reports,
as well as accessing data across various blockchains that can ultimately generate irrefutable business performance analysis.
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example
use case
1
dune
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Dune has become the go-to platform for market analysts and researchers looking to understand broad market movements and the behavior of specific participants.
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chainalysis
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Illicit activity in 2021 reached about $14B, which represented a record low 0.15% of all transactions monitored by Chainalysis.
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sardine
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Chainalysis, Sardine and Elliptic are well-placed to help companies prevent money laundering...
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elliptic
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addressing one of the biggest institutional concerns when it comes to on-chain activity.
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7. the open metaverse creates an economy and true ‘ownership’ of virtual spaces or items

definition: “Metaverse” was first mentioned in Snow Crash, a 1992 book by Neal Stephenson
and, while past generations’ closed metaverses like Second Life and Roblox, a new generation has emerged.
the web3 version is often referred to as “the open metaverse” and creates open economies,
where assets can be owned and traded on any marketplace.
monetization of virtual assets takes a new form
when users actually own their digital goods and create their own digital economy.
benefits
digital ownership
better data
new ways to earn
these open, virtual worlds allow users to provably own their digital goods, monetize their in-world activities
and resist censorship from a centralized actor.
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example
use case
1
the sandbox
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virtual worlds in VR (The Sandbox, Decentraland) or AR (SuperWorld) let users buy plots of land and establish themselves as part of this virtual community/economy.
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decentraland
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this functions like real world property. you could host an event with a celebrity, and then sell tickets to that event. that ticket could be bought on any marketplace, and would allow access to that event, in that virtual space at that time.
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SuperWorld
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owners can later sell the land, and truly control it.
by the end of 2021, open metaverses counted almost 50,000 active wallets.
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8. remix the competition

new marketing models allow challengers to hack attention by offering “ownership”

definition: developers can quickly get attention by taking a project that is successful
and doing something different that rewards users more.
examples
both LooksRare and SushiSwap used token distribution as a form of marketing.
by making tokens available to users, they quickly gained adoption and popularity.
users had a new token with value, that also gave them benefits on the platform.
benefits
customer acquisition
shared ownership
user rewards
remix the competitor
these new models enable more aggressive customer acquisition, reward users for convergence
and let the community own the direction of the platform.
incentivizing the community to participate in product improvements and share business models.
what
LooksRare
SushiSwap
1
example
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use case
The NFT sales marketplace was dominated by Opensea,
which is privately held, and users cannot benefit from.
As a response developers built LooksRare,
which Airdropped tokens to major users of Opensea.
Holders of $LOOKS tokens can participate and get 100% of the platform fees generated by LooksRare.
Uniswap, the largest decentralized exchange, did not easily allow its users to vote on platform changes.
A developer known as Chef Nomi forked the code base from UniSwap to build SushiSwap, enticing liquidity providers with the offer of governance
tokens - which Uniswap quickly copied and added.
SushiSwap attracted $700M in deposits from Uniswap within three days of launch.
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