HFSM (Have Fun Saving More)

Amid the highest inflation in living memory, Web3 tech is offering products that are 10x better at 1/10th the cost, and companies are starting to notice

Aug 09, 2022

Back in 2020, the COVID crash caused mass-layoffs and left millions looking for alternative income sources. Many of them turned toward opportunities in crypto.

And not just a handful of opportunities for a select few devs to work at crypto companies or build yet another "ETH-Killer" L1...

A whole spectrum of onchain strategies offered new income avenues to anyone, anywhere in the world with a little time, desire, and an internet connection.

And they were extremely well-suited to the new remote work model:

Mining
Staking
Lending
Transcoding
LP-ing
Hotspot Distribution
Yield Farming
Art & Music NFT creation
Play-to-Earn
DAO Tasks
Ecosystem Grants
Microbounties

Yes, degen day trading exploded and the chorus of HFSP metastasized across the Twittersphere, but that was just noise around the signal: decentralized projects offered the ability for anyone to work for a protocol in return for compensation.

Prove It.

To become a Bitcoin employee, provide your time and (literal) energy to the network and you'll get a paycheck in the network's native currency: BTC. No cover letter needed.

Evidence that millions took these jobs during the COVID crisis is everywhere onchain. Looking at Helium, we see hotspot growth went vertical:

For Bitcoin, hashrate consistently hit ATHs as incoming miners started adding value to their new Bitcoin employer:

The DeFi space offered freelance workers part time jobs and passive income streams for participating on the supply-side, sending TVL & lending volumes soaring:

Pick Your Poison

Because decentralized products have no fee-taking middlemen, they can offer BOTH higher income for the workers AND lower prices for the users.

During the COVID recession, individuals found value in crypto's higher income for supply-side participants (the workers). Now that inflation is red-hot, costs are +9.1% on average, and every CFO in the world is looking for ways to cut expenses, companies will find value in crypto's lower prices for demand-side participants (the users).

My thesis is basically that Web3 adoption is on a runaway train, because the world is focused on exactly two things currently - recession & inflation - and Web3 tech helps both:

Recessions bring INDIVIDUALS to crypto for INCOME
Inflation brings COMPANIES to crypto for COST CUTS

Web3 products like decentralized file storage, decentralized video streaming, decentralized VPNs, etc. are up to 24x cheaper than centralized Web2 products on average.

The Great Migration

A 24x cost savings is reason enough for companies to switch, now add +9.1% inflation on top...

Recent evidence exists that this Web3 migration has already started. Internally at M31 Capital, we've already migrated all our video & voice calls to Huddle01, a decentralized Zoom built on top of Livepeer & Filecoin.

Huddle01 is cheaper, easier to use, more secure, and honestly... more fun.

M31 Capital migrated from Zoom to Huddle01

At the same time, Harvard University announced they're using Filecoin - a decentralized file storage network - for a new initiative aimed at fighting fake news, establishing trustworthy sources, and preserving vital digital information thanks to FIL's massively reduced cost.

Harvard University migrated from AWS to Filecoin

Similarly, DISH Network chose Helium - the decentralized "People's Network" - for 5G deployment because its blockchain-based approach offers a "radically reduced cost structure to deploying and managing a wireless network at scale."

DISH Network migrated to Helium Network

OTOY, the world's largest provider of visual rendering services (think film animation, medical imaging, virtual & augmented reality, gaming studios, architecture / construction modeling, etc.), is building on Render after recognizing that centralized providers will never have the compute resources necessary to meet the world's rapidly increasing demand without dramatically raising prices.

Only a decentralized global network of CPUs & GPUs can scale to meet the need while being resource & price competitive.

OTOY migrated to Render

Over 100 companies and crypto projects started using Livepeer - a decentralized video streaming platform - as their go-to video streaming platform, showing interest from both Web2 & Web3 products. They're finding real value, cost savings, and benefit in switching from Google Cloud, etc. to Livepeer.

100+ companies migrated to Livepeer

Coinbase likewise recently announced an integration with Ethereum Name Service - a decentralized domain name provider - in order to offer human-readable wallet addresses like "alice.eth" at zero fees.

It's another example of Web3 products offering better UX ("bob.eth" vs. "0x6kvhw44vbhr67...") and better security (no more losing your ETH to a typo) at a better price ($0.00).

For more on this, see M31 Capital's recent Airdrop on Web3 Identity protocols.

Coinbase migrated to ENS

Building Bridges

This trend of Web2 companies using Web3 protocols highlights important, real world use cases for blockchain tech:

Helium is expanding from LoRaWAN into 5G, Cellular, VPN, and the buildout of other, real world offline networks
Hivemapper is running with Helium's tokenomic model to scale up a real-time global mapping network competing with Google Maps
Livepeer is expanding from video transcoding to object detection, audio detection, compositing, and more for both Web3 & Web3 video applications
Render is used for Web2 applications like rendering high-def Disney movies as well as Web3 applications like rendering the Metaverse
Huddle01 also bridges Web2 & Web3 - it's a better UI/UX than Zoom at a lower cost, with stronger privacy guarantees, and crypto-native functionality like token-gating meetings, Metamask login, OpenSea integration for NFT PFPs, etc. All built out entirely on decentralized infra like Livepeer & Filecoin/IPFS

The crypto space gets a lot of flack, but when I look at M31 Capital's portfolio, all I see are real technological improvements threatening AT&T, AWS, Google, Microsoft Azure, Zoom, Spotify, ICANN, and every major firm on Wall St. with better products at lower prices.

And that's exactly what's going to drive the next wave of adoption: Real tech solving real problems

Conclusion

Amid the highest inflation in living memory, Web3 tech is offering products that are 10x better at 1/10th the cost, and companies are starting to notice.

The smart ones have already started migrating over to Web3 for lower costs (Livepeer/Filecoin), better user experience (Metamask/ENS), & greater functionality (Huddle/Render).

So, to all the other companies out there:

HFSM.