Profit Opportunity: Investing in Web 3.0
There’s an investing boom quietly taking place.
It combines the power of two of the hottest sectors on the planet.
As I told my Alpha Money Flow subscribers earlier this week, a couple of well-known crypto investors are putting big money into the startup world.
Andreessen Horowitz, the big-name money manager that may be the largest proponent of investing in the digital space, just announced a huge, $4.5 billion fund that will back crypto and blockchain startups.
At the same time, Binance, the name behind the largest crypto exchange on the planet, has set aside $500 million of its own cash to invest directly in Web 3.0 startups.
Both are taking advantage of today’s lower prices to jump into what may be tomorrow’s hottest asset class… the next generation of the internet.
Generational Wealth
Andreessen analysts say we’re on the cusp of the next stage of the computer cycle.
First came the widespread adoption of the personal computer.
Then came the creation of the internet.
After that came the age of mobile computing.
And now we have blockchain and crypto.
If this is the next big leap in tech, investing in the tiny firms at the heart of this trend could represent one of the smartest moves an investor could make during his lifetime.
But how do you do it? What do you buy?
The opportunities are vast. As Binance and Andreessen have shown, there are many ways to get into the game… everything from simply buying shares of a company to buying individual cryptos to taking advantage of an even newer hybrid idea known as security tokens.
But before a person can get into any of those, he needs to know what in the world we’re talking about.
Web 3.0 is quite a big idea.
In the simplest terms, it uses the blockchain (which is merely a ledger of all activity that’s spread across many computers) to store, share and own data.
It’s the internet… without a few big-name companies controlling the majority of it, like we see today.
In more complicated terms, Web 3.0 represents what we call a tokenized economy.
It’s a beautiful concept that takes much of the perversion out of today’s hybrid capitalist market. Through the ownership of tokens, the platforms and technology behind them are owned by the folks who build them and use them.
The possibilities are vast.
But the easiest way to understand the idea is to think of a blockchain as a single computer. And each computer has a different way of doing things and different function from the other computers (or blockchains).
That means when you log on to the internet in a Web 3.0 world, you won’t need a password for every site you go to. You’ll need just one. Once you are in your unique entry to the web… that’s it. It’s secure.
Imagine what that means for the world of business.
Big Money… Big Opportunity
NFTs – or nonfungible tokens – are a big topic these days. They’ll be even more important as we go from Web 2.0 to Web 3.0.
Think of them as digital deeds.
Yes, they can represent silly art… but they’ll find much more value representing a contract or a title to a home or ownership of a royalty stream.
We’ve heard a lot about stablecoins lately. They’re certainly going through a bit of an “introductory” phase. But the market is finding them more and more useful each day.
Look at the company TrustToken… with investors like BlockTower Capital and Andreessen.
It’s a Web 3.0 business that allows folks to borrow and lend through its TruFi platform, and they can do so with stablecoins. It’s even created its own blockchain-based credit scoring system.
It may not be the leader in the next generation of finance, but I have no doubt the future of banking will be a derivative of its business model.
There are new opportunities for investors in this space every day.
At this stage, it’s critical that we focus on the companies and projects that are building the infrastructure and ideas. Just like we saw as the internet was built, it’s rarely the flashy retailer that makes big bucks in the first generation of a new technology (think Pets.com and the mega-failure it was). Instead, it’s companies like Cisco, Palo Alto Networks and Broadcom that quietly mint millionaires.
In the Web 3.0 space, these are projects like ConsenSys, MoonPay, Chainlink and Flux, all of which are working to create the backbone of whatever comes next.
There are many ways to invest in all of this.
Again, the options span everything from buying tokens to investing directly in startups via one of the many crowdfunding portals.
The key here is the big money isn’t running scared as prices fall.
It’s cheering.
The crowd is out of the way, and valuations are falling back to reality.
Now is the time to move.
We’ll have much more on the subject as it evolves.
Be well,
Andy
P.S. I recently revealed my favorite way to play all of this during The Generational Wealth Summit with famed commentator Buck Sexton. I detail a brand-new asset class that has enormous potential… and give away a free pick. If you’ve got $5 to invest… you can easily get into this one. The big reveal is here.