From: thepipeline_xyz
Crypto is positioned to solve pressing real-world problems, specifically through the lens of technologies like LayerZero and Monad [00:00:19]. The initial motivation for crypto, dating back to 2013, was rooted in a strong libertarian philosophy: the belief that traditional banks are irresponsible with money and that self-sovereignty is a powerful tool [00:00:44]. This core idea emphasized giving individuals full control over their money, enabling permissionless transactions and interactions [00:01:08].
Core Thesis: Disrupting Finance and Money
The early thesis for crypto highlighted its potential to disrupt money itself, along with the entire banking and financial industry [00:01:33]. With the advent of Ethereum and programmable smart contracts, the technology evolved, allowing for the creation of more sophisticated financial primitives and structures that could be broadly useful to the world [00:01:41]. The fundamental goal remains disrupting finance and money, which in turn unlocks numerous other empowering possibilities [00:01:57].
Payments as a Key Application
Payments represent one of the clearest and most easily understandable applications for crypto [00:02:30].
Challenges with Traditional Payments
In the Western world, credit card companies extract significant fees (around 3%) from every transaction [00:02:40]. This constitutes a massive cost for businesses, both small and large [00:03:12]. The combined market capitalization of Visa and Mastercard alone illustrates the scale of this trillion-dollar business, with these costs largely borne by small and medium-sized businesses [00:06:25].
Crypto’s Solution for Payments
Crypto offers a solution by enabling direct payments, allowing individuals with just a phone to pay for services and bypass these intermediaries [00:03:43]. Beyond developed nations, crypto, particularly Tether, is already widely used for payments in parts of the world where credit cards are less common [00:03:54]. For crypto to truly disrupt the payments industry, networks need to process transactions at the same scale as current payment processing systems, with Monad poised to deliver this capability through its 10,000 transactions per second throughput [00:04:22].
Personal Finance Transformation
Personal finance is another significant area where crypto can provide substantial value to end-users [00:04:43]. The aim is to establish DeFi as the standard for personal finance, encompassing banking, trading, borrowing, and lending [00:04:51].
For DeFi to achieve this, systems must offer an experience that is at least equal to, or ideally superior to, centralized personal finance tools [00:05:05]. This requires:
- Reducing slippage from the frequently seen 1-5% in DeFi down to single-digit basis points [00:05:27].
- Improving the cost of execution [00:05:16].
- Making on-chain trading costs comparable or better than centralized environments [00:05:19].
These improvements necessitate a highly performant environment, allowing market makers to quote tightly, compress spreads, and provide users with a much better execution experience [00:05:35].
Broader Disruption: Settlement and Beyond
Beyond payments and personal finance, crypto holds potential in various other categories [00:05:52], including:
- Identity [00:05:55]
- Community [00:05:55]
- General settlement for all types of transactions, whether for stock trading or the transfer of assets like houses or cars [00:05:57].