Dialogue with Standard Crypto Partners Diverse New Narratives Emerge, Now is the Best Bear Market Cycle in History

Compiled & Translated by: Deep Tide TechFlow

The Block interviewed Alok Vasudev, co-founder of Standard Crypto, in this episode. In the conversation, Alok discussed the changes and trends in the bear market and the reasons for market changes. Alok believes that each crypto cycle will have a new blockchain application to drive the bull market. They also discussed the potential of crypto games, economic crises, and the combination of AI, ZK, and blockchain.

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Here are the main points of the conversation, translated and organized by Deep Tide:

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• Understanding friend.tech in 5 minutes How can ordinary people profit from tokenizing their influence?

Host: Frank ChaLianGuairro, The Block

Speaker: Alok Vasudev, co-founder of Standard Crypto

Original Title: “Crypto’s ‘Best Bear Market Of All-Time'”

Podcast: “The Block”

Episode: Link

Trends and Explosions in Bull and Bear Markets

• Alok discussed some changes and trends in the bear market. He mentioned that in the bear market, transaction speed slows down, but the quality of transactions improves. He believes that the participants in the current market are more serious and no longer participate just because they heard that the crypto field is cool or for speculation. There are now many founders entering the crypto field for the second or third time, and these founders have more experience and better understanding.

• Frank and Alok discussed the reasons for market changes. Alok believes that Larry Fink, CEO of BlackRock, changing his views on Bitcoin and cryptocurrencies may be an important factor in market changes. Alok mentioned that the crypto market may have been undervalued in November and December last year because cryptocurrencies and blockchain technology are the right direction for historical development, and the market should reflect the balanced prices of these assets based on the progress made.

• About trends in the crypto market. Alok believes that each crypto cycle will have a new blockchain application to drive the bull market. For example, the bull market in 2013 was mainly driven by Bitcoin, the bull market in 2017 was driven by tokens and ICOs, and the bull market in 2021 was driven by DeFi protocols and NFTs. He believes that the next cycle may be driven by new applications because we are no longer limited by infrastructure as before.

• They discussed the biggest obstacles to the explosion of application layers. Alok believes that in order for more consumer-level applications to work, someone needs to have a wallet. He believes that as more people start using wallets, the difficulty of using wallets should be reduced and become as simple as using a browser. This means that cryptocurrency wallets should become more user-friendly, accessible, and easy to operate, thereby encouraging more people to participate in the use of cryptocurrencies.

• Alok mentioned the concept of “small network effects,” which means that when the number of users of a new product or service increases, the value of that product or service also increases. Network effects are a common economic phenomenon that indicates the value of a product or service is proportional to its number of users.

• Alok’s view is that there are now enough users to start forming these small network effects in new products. This means that as more users start using a new product or service (such as a cryptocurrency wallet or application), the value of that product or service will increase. This increased value may manifest as a better user experience, more features or services, higher security, etc.

• Alok believes that social networks need to start relatively niche and not introduce a large number of celebrities from the beginning. Successful social networks are those that can cultivate their own celebrities, rather than those that introduce celebrities and expect them to bring their own fans.

• Alok believes that the big opportunity for social networks is to find the Status Game of tomorrow, which may include NFTs and other crypto features. He thinks that a cryptocurrency-centered social network is a cool place because it has all the characteristics. It is still relatively niche, but he believes that many cryptocurrency enthusiasts are on the right side of history.

The Potential and Economic Crisis of Cryptogames

• Alok and Frank turned to a discussion about games. Alok mentioned an interesting investment strategy, which is to review the previous market cycle and identify projects that resonated but may not have been fully successful. He believes that these projects may be good investment opportunities. Alok gave two examples, Cryptokitties and Axie Infinity. Both games have achieved some degree of success but also have some flaws. He believes that these games demonstrate the enormous potential of games in the cryptocurrency market.

• They discussed the economic crises in games and how to manage them. Alok believes that economic crises in games may be caused by token price drops, market volatility, or other factors. He mentioned that to address these crises, game developers need to take measures to maintain the attractiveness of the game. He believes that financialization is an effective solution that can help attract players and provide them with additional incentives.

• Alok also mentioned that financialization in cryptocurrencies and games can be achieved through token rewards, token economies, DeFi protocols, and other means. These financialization methods can help game developers attract players and provide them with additional incentives. He believes that this is an effective way to maintain attractiveness of games even under token price pressure.

• Alok believes that Axie Infinity is an important milestone for many game developers, prompting them to delve deeper into the field of cryptocurrencies. He mentioned that Axie Infinity’s success shows that games can still be attractive even under token price pressure. He believes that this is because financialization in games can help attract players and provide them with additional incentives.

The Combination of AI, ZK, and Blockchain

• Alok introduced their investment philosophy, emphasizing that they focus more on finding promising entrepreneurs rather than pursuing specific investment theories. They believe that the key to investment success is finding promising entrepreneurs rather than pursuing specific investment theories.

• They discussed the intersection of artificial intelligence and the crypto field, and Alok believes that there is a deep connection between the two. Alok mentioned that both artificial intelligence and the crypto industry are technology-driven fields that are rapidly developing and have great potential. He believes that both fields are exploring new business models and application scenarios that could have profound impacts on society and the economy.

• Both artificial intelligence and the crypto field require a large amount of data and computing power. The crypto field can provide a secure, transparent, and decentralized platform for data exchange and computation for artificial intelligence. At the same time, artificial intelligence can provide a more intelligent and efficient platform for trading and contract execution in the crypto industry.

• Alok also mentioned that artificial intelligence can help the crypto field better predict market dynamics and risks, while the crypto field can provide a more secure and efficient payment and transaction platform for artificial intelligence.

• With the technological advancements in blockchain and the crypto industry, NPCs in games may have their own bank accounts and wealth. He believes that this will provide more opportunities for innovation and interaction for game developers and players.

• For example, NPCs may engage in trading, investing, or other financial activities with players. This situation will make games more interesting and realistic. Players can have more complex interactions with NPCs and experience a more realistic game world. At the same time, this will also provide more business opportunities for game developers, such as advertising, promotion, or other commercial activities through NPCs.

• Alok Vasudev discussed the impact of technological developments on the crypto market, particularly the progress of Zero-Knowledge Proofs (ZK) technology. Alok mentioned that Zero-Knowledge Proofs allow one party to prove to another party that a statement is true without revealing any other information. This technology has many applications in the crypto field, such as protecting the privacy of transactions and verifying the correctness of smart contracts.

• Alok believes that ZK technology will enhance the trustworthiness of the market. By using ZK technology, transaction parties can verify the correctness of transactions without revealing any other information. This will help increase market transparency and trust. Secondly, ZK technology will help improve market efficiency. By using ZK technology, transaction parties can complete transactions more quickly and securely. This will help improve market liquidity and transaction speed.

• Finally, ZK technology will help expand the application scope of the market. By using ZK technology, the crypto field can better meet the privacy and security needs of users. This will help attract more users to enter the market and expand the application scope of the market.

The Impact of Market Cycles on Technology Development and DeFi

• Alok believes that market cycles play an important role in driving technology development. He explains that market cycles can inject funding into technology research and development. During a bull market, the price of cryptocurrencies rises, and the assets of market participants also appreciate. This means that there is more funding available for technology development. This additional funding can help develop new technologies, optimize existing technologies, or expand the application scope of technologies.

• Alok points out that the progress of the crypto market has far exceeded past levels, with healthier market fundamentals. The current crypto market has more participants, more applications, more technological innovations, and more compliance, among other things.

• Alok specifically mentions DeFi protocols and considers them to be the ideal investment objects. Alok believes that DeFi protocols have the following advantages:

  • Low capital requirements: DeFi protocols typically do not require a large amount of capital investment because they are based on blockchain technology and do not rely on traditional centralized infrastructure. This makes them ideal for risk investment.

  • Strong defensibility: DeFi protocols typically have strong defensibility because they are decentralized and not easily susceptible to attacks or manipulation. This makes them more stable and secure in the market.

  • High operational leverage: DeFi protocols typically have high operational leverage because they have minimal operational expenses, with users bearing transaction fees. This allows them to operate more efficiently and achieve higher returns.

• Alok also mentions that the revenue of DeFi protocols differs from that of software companies. Software companies typically have to bear high operational expenses, while DeFi protocols have minimal operational expenses, with users bearing transaction fees. This allows DeFi protocols to operate more efficiently and achieve higher returns. Alok believes that DeFi protocols are the best business model ever.

• Alok also expresses expectations for the revival of Bitcoin. He believes that Bitcoin may be experiencing a revival. He mentions that Bitcoin used to be a vibrant ecosystem that attracted many developers and technology enthusiasts. However, over time, this vitality gradually diminished. But he believes that Bitcoin is now recapturing this vitality, and many newcomers to the crypto market may not realize the potential of Bitcoin.

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