Web 3.0 offers some incredible opportunities and Hive is at the forefront of it. In the past we discussed the combination of social media and finance. This is something that Elon Musk is doing with Twitter, yet in a centralized way. Ultimately, he is still operating within Web 2.0, something that does not financially benefit the masses.
Hive operates on a different premise. Anyone who has Hive Power has a vested interest in all that is taking place within the ecosystem. Since it all feeds into the same trough, this is where Hive stands out.
A blockchain can be thought of as a cooperative. We all have a piece of it. Any improvement helps everyone.
When looking at social media, we realize that the network effect is vital. The same is actually true in the world of money and finance. It always is a numbers game. Here we see how Hive can combine the two.
In the end, if people utilize Hive as designed and help to push it forward, we can see a global middle class arising.
The power of staking is a tremendous breakthrough for cryptocurrency. For decades, those that could truly benefit from financial products were the few. We all know the present financial system is exclusive. A blockchain like Hive can help change that.
We were excluded from hedge fund, venture capital deals, and private equity raises for startups. Most reading these words did not qualify as accredited investors. Even then, how many of us had the expertise to truly understand what is taking place?
Finance, like any industry, has its own language meant to exclude. This allows the "translators" to charge huge sums. It is another area cryptocurrency is changing.
Let us use centralized exchange (CEX) as an example. One of the services they tend to provide is that of market maker. This can be a beneficial service in that it brings liquidity to market. It can also be profitable. Here is the major question: how many of us ever served as market makers?
The answer is likely very few of us. It is a game only for high wealth individuals (or companies).
Cryptocurrency, or more specifically decentralized finance (DeFi), changed that. Through the introduction of liquidity pools, anyone can participate in the making of markets. As automated market makers tap into those pools, the funding provided by individuals can present a return. The concept of the DEX radically alters this scenario.
Staking of coins and tokens is the new creator for a middle class existence. Here is where the idea of yield enters. When people stake their assets, a return is garnered. As their holdings grow, compounding ends up taking over.
On Hive, we have all kinds of options. Between powering up $HIVE as well as all the different tribes and games, we see many different ways to stake. Over time, this can add up for millions.
HBD is one of the most fascinating aspects to cryptocurrency. We discussed the many potential utilities over the past year. Since it is a base layer coin as well as being tied to $HIVE, we see something truly special. It is a market driven asset that has no company or foundation. The value (not price) of it will skyrockets when project teams focus upon how to incorporate the coin into all they are doing.
Putting one's HBD into savings presents a 20% APR. This is mind blowing to people who believe it is unsustainable. Yet, when we look at the amount of HBD available, it is almost nothing (relatively speaking). To even get to 1 billion HBD is going to require a lot more than interest paid on staking. If that is the path taken, it will be decades before that is reached.
What is interesting is that, to expand the Hive ecosystem, we need more money. In other words, a lot more HBD could be required. It is a fascinating circular relationship that compounds itself in terms of the growth.
At the base layer, $HIVE also provides yield while also presenting the opportunity for speculation. This is not pegged yet does offer a return. To start, there is the inflation adjustment. At present, this is a bit under 3%. While that is nothing to get too excited about, we then have the ability to garner curation rewards. Using a simple return of 8%, this puts the staking (and curation) return at near 11%.
That is a return which, over time, could amount to significant holdings. It could be furthered by a bull market increasing the value in fiat currency, a necessity in the world we live in today.
Finally there are the second layer tokens. At this point, it is mostly Hive-Engine but a few are showing up on DLUX. To start, we know there are a few smart contract platforms being developed which means they will offer the ability for projects to create tokens. This is an opportunity if we attract more builders.
We have a hidden gem here. This is vastly overlooked due to the fact that no layer 2 token has really broken out. The value of them is peanuts, especially when compared to $HIVE. Market capitalizations are in the hundreds of thousands instead of millions. That might not always be the case.
Like at the base layer, there is staking with many of these projects. We also have curation for those that utilize the Proof-of-Brain mechanism. What if one of these tokens saw a sustained price level of 50 cents? Suddenly, some people are sitting on a nice pile of money.
It takes on a different connotation when we start to figure the yield at that point.
To me, this is the epitome of Web 3.0. The concept of micro-earning was discussed on a number of occasions. This is a concept of earning small sums of money from many different sources.
Many blast the idea because they feel it equates to no earning. To be blunt, this is foolish and shows a clear lack of understanding of what is being offered.
Here is an example:
What if an individual offered some infrastructure by spinning up a server and running some software. For doing this, the person nets a monthly profit of $25. In most of the world, this doesn't go very far.
If we go a bit further, what if our entrepreneur decided to open up 100 servers, each earning an average of $25 a month? Now we have $2,500 coming in every 30 days, a significantly higher figure.
We can apply this to more than just infrastructure. What if there were multiple staking projects doing the same thing. Couple this with the curation and author rewards on Hive, both base and second layer, and we can see how this can alter people's financial future.
Of course, this ultimately boils down to the network effect. In the end, numbers tell the story. For now, we are creating the foundation which can leverage this concept further when the number of users grow.
It is possible to see how this could create a new middle class around the world.
This is the power of Web 3.0 and Hive is at the center of it.
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