The race to fund crypto's future sure is expensive I'm impressed with the pace at which Coinbase has invested capital into other companies in the larger blockchain market. It's a smart move, as the public U.S. company can disburse comparatively small sums (when stacked next to its revenue base) and buy both ownership and information access in startups, providing it with early-warning data regarding what's popping. Given that Coinbase is an obvious incumbent – and gatekeeper, to some degree – in the crypto market, its investments make sense. But there's investing, and there's investing. And it appears that the newly announced FTX fund is something more aggressive than what Coinbase has managed, despite its pretty quick cadence of deals. FTX's fund crypto will total some $2 billion and, per interviews, could be disbursed just this year. That's a wild pace of investment, perhaps one reminiscent of how quickly a16z put its recent $2.2 billion crypto fund to work. A few questions: - Why does the crypto market need this much money when its user base is pretty small compared to the larger Internet?
- Why are we using so much fiat to finance crypto?
These are interlinked questions. They sum to a simple confusion of mine regarding why it's so hard to build things in the crypto market that are useful. Coinbase and FTX exist toward the edges of the crypto world, shuttling money back and forth from the traditional economy and what could be its future. That they are investing is smart, but the amount of money they are willing to invest, along with what traditional venture capitalists are also lobbing at blockchain startups, has me somewhat confused – what's it all being spent on? The two major blockchains are established, and hardly new (Ethereum was thought up in 2013 and launched in 2015; the Bitcoin whitepaper came out in 2008); stablecoins exist and have a number of well, stable players; and a bunch of capital has gone to NFT marketplaces and a few crypto games. Some of which have even built modest player bases. But it feels a bit concentrated when we compare the amount of money flowing into the space to what we can see in terms of usable outcomes. Institutional Investor reports that $32.8 billion in total was invested into "crypto and blockchain technology businesses" last year. Perhaps a lot of stuff built by that money is coming out soon that will blow us away, but now well north of a decade after Bitcoin said, "Hello, world," I still don't use any blockchain-powered apps or services day to day. Unless I am tinkering with one part of the crypto world for research purposes, of course. And I spend more time online than I want to admit! Perhaps the new FTX fund will bring the mass-market blockchain product to market that isn't merely another vehicle for speculation. Let's wait and see, I suppose. Alex | 
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