Top Finds from a16z's Crypto Report

This is a fun week already. ETH is flirting with $2k, BTC hit $30k, we had a Reddit avatar journey, and many in Web3 have descended upon the city for NFT NYC.

Let’s zoom out to get some insights about the big picture from one of the biggest web3 VCs in the game: a16z crypto.

Their annual State of Crypto Report just came out, and this year they’ve also added an index to better track trends in the industry.

Here are some interesting learnings from the 60+ page report.

JOB INTEREST REMAINS HIGH

Even with all of the (ahem) interesting news in crypto over the past year, job search interest remains high in the space. I thought that the likes of Celsius and SBF would have turned job seekers off, at least down to 2020 levels.

But with all the technological advances and new opportunities across blockchains, job seekers are still interested. a16z noted that crypto job interest seems to generally correlate with crypto prices. Hey, we have short memories— that tracks.

ACTIVE ADDRESSES STILL GROWING; MOBILE WALLET USERS DECLINING

You love to see this chart of active addresses growing across major blockchains. But there are some challenges here that we also face with NFT buyer data: just because addresses are growing doesn’t necessarily mean unique users are.

It’s simple to have 5, 15, or 500 addresses. We can’t know for sure if more actual people are transacting and adopting crypto.

But since this is the only data we can rely on, I’ll take the good news and keep it moving. 😶‍🌫️ It is interesting, though, that the same report shows mobile wallet users are on the decline. Whoever these addresses are, they aren’t using their phones to transact as much as they used to.

SPONSORED POST: CRYPTOYS

Cryptoys is creating an elevated collector experience like no other– and their latest drop is now live. I personally love their box-opening experience… and deciding whether to unwrap it from the plastic or not.

Collecting Cryptoys is more like collecting physical toys than typical NFT offerings. The Genesis drop contains 10,000 toys each for Corgi, Kitty, and Panda with unique skins for seven rarity levels. The more scarce the rarity skin is, the more powerful it will become.

With 21 possibilities, you’ll want to collect them all!

THE U.S. IS LOSING CRYPTO ADOPTERS

Perhaps Coinbase said it best in their frustrated post about their Wells notice: “Tell us the rules and we will follow them.” 

But the U.S. has not been very clear on the rules. While deciding, they have sometimes banned entire technologies and decentralized software.

There are many proposed regulations and impactful cases to be decided soon, which will shape how the U.S. embraces (or rebuffs) this massive industry. In the meantime, the number of U.S. crypto devs has been dropping, and so has traffic on crypto websites. 🥲

NFTs ARE JUST A TINY PART OF ETH’s $417 BILLION ECONOMY

I was shaken out of my ETH NFT bubble when I saw this tiny dot representing NFTs on Ethereum ($22 billion). I don’t really mess with ERC20 tokens, so I didn’t realize what their gigantic market cap was. $172 billion is no joke.

This is also topical for the moment: Today’s Ethereum Shanghai upgrade means that the $33B of staked ETH (which secures the network) will finally be able to be withdrawn by its stakers (with daily limits). According to some, this could cause some short-term volatility with ETH.

The a16z 2023 State of Crypto report generally shows that interest remains and technology is still advancing, even in a bearish market.

Web3 gaming, zero-knowledge rollups, and real big-brand interest in digital collectibles/NFTs are some of the biggest themes in the report.

There’s so much more info in there, including an active NFT buyers chart showing an increase. But the source for that chart is CryptoSlam, which does something with Blur “wash sales” volume that isn’t fully clear…

In any case, I love a good data set, and the new index will be something I monitor as it updates on a monthly basis.

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