Pantera Partners: Optimistic about the development of social, modular, and Bitcoin ecosystems

Deep Tide TechFlow
2023-11-03 11:56:41
Collection
Due to the cultural significance of the Bitcoin chain, Bitcoin NFTs may evolve into a form of "digital jewelry" and collectibles in art, fashion, and media.

Original Author: PAUL VERADITTAKIT

Original Compilation: Deep Tide TechFlow


From the emergence of AI + blockchain use cases, to the increasingly important role of stablecoins in financial markets, to the maturation of zero-knowledge proofs, I believe that despite market fluctuations, these areas remain resilient. In this article, Paul Veradittakit from the renowned crypto VC Pantera will explore some areas they are closely monitoring.

1. Social and Consumer Use Cases

Web2 has evolved from social to finance, while Web3 is transitioning from finance to social. From Friend.tech to on-chain loyalty, the recent social elements of Web3 have garnered increasing attention as they attempt to use tokenization to change social behavior. As consumer transactions may become more frequent on-chain, we believe stablecoins will play an increasingly important role as a settlement solution for entering and exiting between DeFi and TradFi use cases.

Moreover, the latest advancements in generative AI may promise a more abstract, personalized, and simplified user experience. With the added abstraction enabled by AI, we hope this can lower the barriers to entry into Web3, making blockchain data more accessible to those without a technical background.

2. ZK-Supported Modularity and Composability

We believe that zero-knowledge proofs (ZKPs) will continue to evolve, whether through new theoretical advancements in recursive proofs or the gradual specialization of companies in specific verticals, playing specific roles such as co-processing, proof execution, zkDevOps, privacy layers, and more. With these, we are beginning to use ZKPs as a way to establish universal interfaces between different layers of a modular tech stack.

Modularity refers to the different layers of the blockchain stack (consensus, execution, data availability, etc.) being operated by different providers. This idea allows for the creation of a "plug-and-play" blockchain architecture in a Lego-like manner, achieving greater composability. This means projects can customize their blockchain tech stack according to the specific needs of consumer-facing applications. Additionally, the increased composability of smart contracts using a universal target language (like Rust) makes it easier for developers to familiarize themselves, lowering the entry barrier for Web3 developers.

3. Bitcoin Ecosystem

The third area worth watching in the coming year is the entire Bitcoin ecosystem, which has already sparked a new wave of interest ahead of the anticipated 2024 halving. This includes the potential SEC approval of ETFs from major TradFi funds, as well as a modular Bitcoin blockchain that allows for more composable smart contracts.

Perhaps one of the most interesting innovations is the rise of Bitcoin digital assets supported by technologies like Ordinals. With this, we may see a divergence in the use cases for NFTs, where Ethereum's NFTs may focus more on trading utility, while Bitcoin's NFTs, due to the cultural significance of the Bitcoin chain, may evolve into a form of "digital jewelry" and collectibles in art, fashion, and media.

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