- Bitcoin - is digital gold
- Ethereum - is oil or gas
- L2's - are like C level executives
- Tokens - are programable equity
- Web3 - is your passport to the metaverse
- NFTs - are digital things
- ENS Domains - is usernames for the metaverse
- DAOs - are digital companies
- Shitcoins - are everything except bitcoin
- Memecoins - are tokenized memes
- The Metaverse - is the network of social networks
It’s hard for people who’ve been in crypto for a long time to talk about crypto without using lots of jargon. Every industry suffers from this, but it can be exceptionally bad in crypto land where everything is newly invented!
So here’s our best stab at explaining key topics in crypto. You can also find tons more crypto definitions in our glossary.
Bitcoin - is digital gold
- The reason gold was base layer money for thousands of years is because it had a known/established/predictable stock to flow.
- Gold kept governments honest, they couldn’t print more paper than they had gold - this all changed in 1971.
- Bitcoin gives us an algorithmic stock-to-flow AND since its digital its easier to settle.
Ethereum - is oil or gas
- Ethereum never intended to be money in the same way Bitcoin did. Instead, it’s a world computing platform where ETH is used to pay for transactions on the network.
- Transaction fees on Ethereum are even called gas, ETH fuels transactions.
- That being said, ETH is being used as money and a unit of account for NFTs which are typically priced in ETH.
L2's - are like C level executives
- Layer Two’s (L2s) like Arbitrum, Polygon, Optimism etc. are designed to make transacting on the blockchain faster and cheaper by batching transactions together as a single transaction on the base layer.
- What if every employee worked directly for the CEO!? It's not scalable! You need hierarchy.
- Also important to note that money has L2s and L3s: gold→fiat→debit cards→credit
Tokens - are programable equity
- They're NOT equity, so stop saying you bought “10 shares of CRV”
- Some tokens are programmed to work exactly like equity, but many are not.
- Imagine launching the first iteration of your business and it being publicly traded at the same time - it’s an incredible opportunity.
- Voting rights, rev share, but also utility and anything else you want to program the token to do.
Web3 - is your passport to the metaverse
- Web3 also refers to the decentralization of the tech stack beyond simply geographic redundancies. Now we're talking thousands of computers incentivized to run your programs.
- However to me, the most important aspect of Web3 is that you now have a digital identity for traveling "The Metaverse". A place many of us have been exploring for a decade via “social networks” while mindlessly reinventing ourselves from scratch at each stop.
- Isn't it stupid that every ecommerce checkout and plane ticket you buy makes you copy/paste the same crap over and over? You have thousands of "accounts" in your password manager. And every social network requires new usernames, profile pictures, friend lists, etc. Your Tweets aren't on Facebook and your Google+ posts are, well, gone.
- There's a theoretical future where all your data lives on public blockchains and you hodl the keys to prove what's yours. There's a lot to figure out, but if you live in DeFi-land you're already experiencing this with your money every day - soon everything could work this way.
NFTs - are digital things
- The world is made up of People, Places and Things
- Web3 (wallets) are people, The Metaverse is the place & NFTs are things
- Dan Stone in our NFT episode said that everything in the real world is an NFT - everything is owned by someone.
- We are going to have virtual things - its hard to imagine, but we'll have more of them and they'll be more important than your physical things because they traverse the metaverse
- The first NFTs are just art...
ENS Domains - is usernames for the metaverse
- Remembering 0x0ea83447807941fb777bb60137b030b3e795dd7e is never going to happen - gerbz.eth is a lot cleaner
- Technically its a namespace not just for people but also places & things
DAOs - are digital companies
- Have you ever setup a company?! And you thought crypto jargon was complicated…
- There’s no longer a need to tie a company to a place. There’s no longer a need to tie a person to a company.
- Have you ever voted on anything your public company shares give you voting access to? probably not. Do you eve know how?
- Constitution DAO was like a flash dance!
Shitcoins - are everything except bitcoin
- LOL - I mean… thats how a bitcoiner would explain it.
- Technically they're cryptos without a plan or purpose, usually a fork or copy of something that already exists
- Ever used product hunt? or remember the early days of the app store? Those were shitcoins of those ecosystems.
Memecoins - are tokenized memes
- Takes all the incredible innovation we've discussed here and shits all over it by doing nothing but tokenizing a meme as a way to help it spread
- Sometimes called dogcoins - doge was definitely the first
- But what's incredible, is that for the first time in the history of the universe you can invest in culture and cryptographically prove your involvement and contribution to culture through memecoins
The Metaverse - is the network of social networks
- Often confused with immersive 3D virtually reality, I argue that we already live in the metaverse and have for a lont time.
- The metaverse is simply the virtual space where we spend most of our time now a days, be it news sites, social networks, txting, etc.
- It use to be "you spend a lot of time on Facebook", now your attention is spread across a web of networks
- Why do you think FB re-named themselves Meta!? They’re now a web of social networks: Facebook, WhatsApp, Instagram, Threads…
Written by: @gerbz Gerbz is the founder of BitLift and has been journeying down the crypto rabbit hole since 2013.