Sup, nerds!

Here’s what you’re getting in today’s edition:

• 💅 This is cool: The Web3 version of Slack

• 🔎 This seems important: The dark side of Bitcoin ETFs (and the resulting benefits)

• 🤝 Partner: Time to figure out your finances? Let’s talk about it​

• 🔪 Let's dissect this: The SIMD-0096 proposal (here’s what that means)

Terms used in this edition (click for an explanation, or ask Web(GPT)3!):
Web2/3.

💅 This is cool:

The Web3 Version of Discord

In one sentence: River Protocol wants to become the Web3 version of Discord, allowing community members to earn crypto in exchange for quality contribution.

If you contribute to an online community, what do you get in return?

In Web2? You’re going to get a warm-fuzzy feeling for being part of something larger than yourself, and maybe a cosmetic badge to put on your profile picture.

In Web3, there’s this vision that you’ll get all of the above, plus a tangible digital asset (crypto) which will encourage you to contribute further over time.

It’s a bit of a foreign concept, and one that raises some potential alarm bells…

(E.g. will financialization bastardize the underlying community, creating a bot epidemic in the process?).

That’s always a risk, but that’s not to say tokenized communities haven’t been built with some success in the past.

The FortniteBR Subreddit has been rewarding its contributors with $BRICK tokens for a while now, and it’s still going strong!

Only problem is:

FortniteBR’s reward system is duct taped together, because Reddit isn’t designed to support community tokenization.

That’s why the launch of River Protocol caught our eye.

It’s essentially a tool set that lets builders create their own tokenized community platform.

Think Discord, but with fully integrate tools that allow users to:

1. Contribute-to-earn

2. Cast votes based on their total token holdings

3. Send private encrypted messages with no middle-man

4. The ability to own their data (instead of Discord, Slack, Facebook etc.)

Is this going to dethrone the big Web2 community platforms?

Probably not.

But it doesn’t need to. The crypto space is one big network of users, itching to explore crypto-centric platforms.

Which means River Protocol builders should be able to carve out a user base pretty darn easily.

Neat!

🥇 Want the news before anyone else?

🔎 This seems important:

The Dark Side of Bitcoin ETFs (and the resulting benefits)

In one sentence: The demand for the Bitcoin ETFs are pushing BTC’s price up (hoooray!), but also concentrating BTC ownership, allowing for greater price manipulation (boooo!).

“Everyone has a price.”

That’s pretty much the driving factor of Bitcoin’s price.

If there’re more buyers than sellers, the price goes up in an attempt to convince holders to sell.

…and if that isn’t successful? The price goes up even further.

As of this writing, the US Bitcoin Exchange Traded Funds (aka: ETFs, aka: funds that buy Bitcoin every time someone buys a share in their fund) own a whopping 5% of the 21,000,000 Bitcoin supply.

And if US stock investors’ appetite for BTC continues, that’s probably going to increase — leading to a supply crunch, where the price shoots up in an attempt to sway long-term holders into selling their BTC.

Those are the benefits of the Bitcoin ETFs…

The dark side of it all?

These ETFs aren’t being bought up by a large swath of retail investors as much as they are a select few ‘big dog’ investment firms.

That kind of concentration puts a lot of power in the hands of a few.

Meaning they can:

Sell off a small portion of their holdings → dump the BTC price → only to buy it all back (and then some), giving them an even greater share of BTC’s supply.

Good news/bad news?

This sort of manipulation was going on long before the ETFs were around…

So in many ways, it’s business as usual — just with higher prices.

(Hooray? ¯\_(ツ)_/¯)

🤝 Partner:

Time to figure out your finances? Let’s talk about it.

Handling your finances can be overwhelming. It shouldn’t be.

Talk to a Fruitful Financial Guide, and get organized, optimized, and on track to hit your goals in no time.

Our Guides are friendly, expert CFP® Pros who help with everything money touches. Connect over 1:1 sessions focused on making progress, and message anytime.

You’ll also have a single, intuitive place to talk about, track, save, and invest your money.

Try it for 30 days! If you don’t love it, get a full refund. No fuss.

Get Started, Choose Your Guide

🔪 Let's dissect this:

The SIMD-0096 Proposal (here’s what that means)

In one sentence: The SIMD-0096 proposal was just approved meaning that Solana validators will get 100% of the ‘priority fees’ paid (up from 50%).

Here’s one of those ‘only in Web3’ moments.

The SIMD-0096 proposal was just approved.

(Sounds dry, but hear us out)!

Similar to classic payment processors (Stripe, Square etc.), when transacting in crypto, you’ll usually pay a fee.

For a blockchain like Solana, the normal fee is pretty cheap, but imagine if there was an NFT that you realllly wanted, and right at that moment there were thousands of other people who were transacting on Solana?

In that case, chances are, the network will be clogged up, and you’ll have to wait ages before the transaction completes.

So, instead of waiting at the back of the line, you can pay a ‘priority fee’ to give you a Disneyland fast pass right to the front of the queue.

With the SIMD-0096 proposal that was just approved (with 77.77% voting in favour), it means that Solana validators will get 100% of those priority fees (up from 50%).

While a 77.77% approval vote is high, it doesn’t come without controversy.

Previously, 50% of priority fees were sent directly to validators and the other 50% was burned (destroyed forever).

Those against the proposal say that it will make Solana more inflationary without the inbuilt burning mechanism.

But, some folks much wiser than us have done the math, and turns out it won’t have much of an inflationary impact, if at all.

Either way, how cool is it that the Solana community (the voters) could choose the path for how validators are rewarded?

Only in Web3.

Real World Blockchain Applications - Voting