Teeka’s Note: Friends, today I have a special guest I want to introduce.
His name is Graham Friedman. And he’s co-editor of my newest crypto initiative.
Graham knows more about Web3 than anyone else on the planet. He’s a crypto OG – buying bitcoin for literal pennies in 2010.
In fact, he’s enormously talented at picking winning cryptos… making huge gains like 27,738%, 33,483%, and even 74,222%.
That’s why he’s now the Head of Venture at Republic Crypto, a leading advisory firm that advises some of the world’s most powerful people and institutions.
I’m talking about one of the world’s largest sovereign wealth funds (with close to $1 trillion in assets)… Billionaire sheiks from the Middle East… and a FAANG company.
Graham rubs shoulders with famous venture capitalists like billionaire Mike Novogratz.
You normally can’t get access to his thoughts on the best crypto investments unless you’re a huge whale. I’m sure you’ll be as excited as I am to have him on our team.
In today’s essay, Graham will tell you about an exciting new idea we’re covering at Palm Beach Research Group. So let me turn it over to him…
By Graham Friedman, co-editor, Palm Beach Pioneer
When I first started trading bitcoin in 2009, there were no exchanges to handle the transactions.
Back then, only those with the technical chops to create a node could easily obtain bitcoin.
And mining was a lot more complicated than it is now. If you didn’t have a degree in computer science, you were out of luck.
However, some enterprising individuals created meetups called “Satoshi Circles” (named after bitcoin’s pseudonymous creator, Satoshi Nakamoto) to swap tokens… and those circles were my first foray into crypto.
When I lived in New York in the early 2010s, I frequently attended Satoshi Circles in Union Square or the Whole Foods cantina on Houston Street.
In these circles, miners who actively produced bitcoin could sell some of their tokens to newbies armed with a few dollars and a heavy dose of curiosity.
At the time, bitcoin traded at 25 cents. So I got in really early. But the Satoshi Circle transactions came with a lot of risks.
Sellers would write down their 24-word seed phrase on paper and hand it to you. (A seed phrase is like a password to access or recover your crypto from a wallet.)
As a buyer, you had to trust that the phrase was correct… And since both parties had the keys to each other’s bitcoin wallets, the opportunity for theft was high.
Some of these trades even happened in back alleys. And the threat of violence always loomed large.
Unlike the crypto hacks you see today, back then we had “$5 wrench” attacks. Someone would buy a $5 wrench… hit you across the head with it… and take your seed phrase.
(Fortunately, I’m a black belt in the martial art form of Krav Maga. If I wanted to self-custody back in the early days of crypto, I knew I had to be able to defend myself.)
It was truly the “Wild West” days of crypto…
Eventually, crypto evolved into the multibillion-dollar industry we see today.
Crypto’s Internet Moment
Like Teeka, I know many people are scared of crypto right now. And I get it.
They see the negative headlines… and think the building is burning down around them.
But my reply is this: If the building is burning down, why is so much institutional capital running into it?
It’s because institutions know crypto is not burning down… It’s expanding to accommodate more people – Millions more.
In December 2022, shortly after the collapse of the FTX exchange, Wall Street titan Goldman Sachs said it plans to invest tens of millions of dollars into crypto.
Goldman Sachs knows crypto isn’t burning…
Currently, only 3.75% of the world’s population has crypto exposure. That’s just 300 million people.
But according to a former Goldman Sachs fund manager, that number will be 5 billion people by 2030. That’s over half the population of the entire globe.
That means crypto is the fastest-growing technology in human history… growing its user base at twice the speed of the internet.
But despite this reality, the market is still ignoring it.
That’s where our opportunity comes in… while the mainstream writes off crypto, we can set ourselves up to profit in a corner of crypto called “Web3” as adoption explodes.
But before I get into the details of how we’ll do that, let me give a bit of background on myself…
I’m currently the Head of Venture at Republic Crypto, working closely with early-stage companies before they launch.
I have an extensive background in bringing tokenized companies to market, and I’ve worked alongside close to 20 teams throughout this process.
Before my work at Republic, I co-founded TLDR Global, a crypto venture fund active from 2016–2018 and extremely active throughout the 2017 bull market.
Last year, I connected with Daily editor Teeka Tiwari through our network of blockchain acquaintances.
And we immediately recognized that new developments in Web3 would drive crypto forward in an even more explosive way than we saw with the internet after 2000.
The Next Evolution of the Internet
For many, Web3 may still sound like some futuristic idea. But it’s simply the evolution of the internet.
Let me explain…
Web1 was the early internet until about 2000. You could use it to read websites… search for information… and buy items on websites like Amazon and eBay.
Web2 is the version you’re using now.
It allows mobile computing… social networks like Facebook and Twitter… and multiplayer games.
It birthed the Big Data industry… machine learning… and search algorithms like you see on Google or Netflix. It also made those companies wealthy… and not their users. They generated billions in revenue by selling your data.
With Web3, you won’t just be able to send data to other people… but also anything of value. More importantly, you will own and control these assets.
All with the click of a mouse. And without the need for a third party.
Anyone using Web3 can make a loan, borrow money, transfer real estate, or even trade fractions of the value of famous paintings.
At its simplest, blockchain technology is an online ledger. And like any other ledger, it tracks transactions.
But the blockchain has three main advantages over traditional internet networks.
It’s decentralized: Data is distributed instead of stored in one location… making blockchains much harder to hack than centralized databases.
It uses state-of-the-art encryption: This makes transactions much safer.
It’s peer-to-peer: This allows individuals to transact with one another without an intermediary – lowering costs.
Because of those advantages, Emergen Research projects the Web3 industry will grow from $3.2 billion today to $81.5 billion by 2030. That’s an over 25-fold increase.
And the World Economic Forum forecasts the Web3 industry will eventually be worth $8.6 trillion.
By comparison, a study by the Internet Association estimated the current value of Web2 at only $2 trillion.
From an investment standpoint, the major difference between Web2 and Web3 is you can actually own a piece of Web3 infrastructure.
Think of it this way…
During the Industrial Revolution, the public couldn’t directly invest in the infrastructure that increased the U.S. gross domestic product (GDP).
I’m talking about the railroads, oil refineries, electric grids, and banking systems.
The men who owned the infrastructure – Vanderbilt, Rockefeller, J.P. Morgan, Edison – sired some of the wealthiest families in history.
And the companies they spawned made early investors incredibly rich.
The same is true of the modern internet.
Its infrastructure – protocols like HTTP and TCP/IP – let users seamlessly send data anywhere in the world.
The largest companies in the world – Apple, Amazon, Microsoft, and Google – wouldn’t be around if it weren’t for Web2 protocols.
And investors who grabbed shares of these companies early on made legendary fortunes.
Right now, the internet is evolving into a new version called Web3.
This next-generation internet will use the power of blockchain to let users send anything of value to anyone else anywhere in the world.
Think of Web2 as the post office. You can exchange information at a post office.
Web3 is like a bank. You can exchange value at a bank.
And the beauty of Web3 is that you can own a piece of the protocols that will exchange trillions of dollars’ worth of value.
That’s why we call it the “ownership economy”… because you can actually own – and profit from – Web3 infrastructure.
One example is Ethereum… the crypto-equivalent of a computer operating system like Microsoft Windows.
At the heart of the ecosystem are programs called “smart contracts.”
Smart contracts live on blockchains, allowing them to act autonomously without human involvement.
While smart contracts are slower than the traditional apps we use in Web2, they’re highly secure and robust. And they’ll remove the middleman from many of the transactions we make today.
Ethereum launched in 2015. I was an early adopter and began to accumulate it aggressively that year.
Since then, Ethereum is up over 300,000%. And now, it even pays a yield.
I was also an early investor in bitcoin.
I first heard about it in 2008 when I stumbled across its whitepaper. I bought my first bitcoin a year later.
Since then, the crypto is up over 7,000,000%.
That’s the power of becoming an early “owner” of Web3 infrastructure.
The Last Bear Market
Just like the internet reshaped how we interact and share information… Web3 will reshape how we trade, share, and store financial assets and other valuable data.
And when the dust settles on the current crypto bear market, it’ll be the last time we see opportunities for the exponential crypto gains I mentioned above.
That’s why Teeka recently held a special event called “Big T’s Final Call.”
During the event, he explained what we see happening in crypto, what to expect in the year ahead, and shared details on a massive move in crypto we’ve never seen before.
You can watch a free replay of the event right here for a limited time… But please, do not wait.
This will likely be the last bear market where you can turn small stakes into meaningful, life-changing returns… and there’s no time to waste.
Co-editor, Palm Beach Pioneer