Venture capital firm Andreesen Horowitz (A16z) has released its inaugural “State of Crypto” report which gives insight into the market development cycle.
The study compares the current market downtrend with the dot-com crash in the early 2000s, suggesting “Better to Build” to avoid missing any opportunities in the industry.
A16z said the crypto market is driven by a cycle where strong digital asset prices attract talent into the space, developers innovate during a downturn and the resulting projects and startups drive optimism once winter is over.
According to the report, global market capitalization, developer activity, startup activity, and crypto-related social media activity ramped up in 2018 after years of big ups and downs.
2021 boom changed perception of money
Furthermore, 2019 and 2020 were not good years for digital currencies but the 2021 crypto boom changed how the next generation of money and the web were perceived.
Web3 has a much lower take rate than the current tech and social media giants. According to the report, the largest non-fungible token (NFT) marketplace OpenSea has a take rate of 2.5% while Apple’s app store is up to 30%, 45% for YouTube, and around 100% for Facebook, Instagram, and Twitter.
“You know something is profoundly wrong with our economy when Big Tech has a higher take rate than the mafia,” says U.S. Congressman Ritchie Torres.
“State of Crypto” looks at how much creators could earn on average, suggesting that NFTs are the best way to “monetize directly with fans.” In 2021, roughly 22,000 digital artists have earned nearly $4 billion while 11 million creators on Spotify could take $7 billion.
Finally, the report calls Ethereum (ETH) “the clear leader” for the next generation of the web with around 4,000 active monthly developers and more than $15 million worth of transaction fees paid by users on an average weekly basis.
BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.