You're Not Too Late

When you’re a very online person, it’s easy to think that you’ve missed the bus.

I often think that the blog post I want to write has already been written. That I can’t make money investing in a company – the stock has already gone up 10x and I didn’t get in early enough. That I missed out on gigantic crypto gains.

So on a daily basis, I try to remind myself: You’re still early.

Hiding in Plain Sight

In the 1994 movie Forrest Gump, Forrest finds out that his business partner “invested in some sort of fruit company” and that they “didn’t have to worry about money anymore”. That company was, of course, Apple.

The implication is that Apple was a great investment prior to 1994. However, if you put money into Apple stock the day that the movie was released, you would have returned 640x on your investment (27% per year).^[1] Apple has tripled in market cap in the past three years alone! And this is a stock tip found in one of the most iconic movies of the past 30 years, one that won the Best Picture Oscar.

Zoom out on an exponential curve and it still has the same shape. But your y-values (i.e., what you care about) will have changed dramatically.

The Bus Is Parked

Working within crypto over the past year, I’ve been exposed to tons of new, exciting concepts:

• Decentralized exchanges
• Zero-knowledge proofs
• NFTs
• DAOs
• Yield farming
• Perpetual swaps
• Etc.

If you recognize (recognize – you don’t even need to be able to define) one of those words, you’re early to crypto.^[2] It’s easy to think that the innovation has already taken place, but the space is just 12 years old. Even the current king of crypto (or, if you prefer, the “Prince of Risk”), Sam Bankman-Fried, only began working in crypto in 2017.^[3]

Recently, I’ve been following the explosion in the NFT space, wondering if it’s too late for me to get involved. Let’s take a look at some numbers:

• Last 30 day OpenSea trading volume: ~$3B
• Users: ~190,000
• Transactions: ~2.2M

And some comparables for market sizing:

• There are ~500,000 daily active Ethereum addresses, down from a peak of ~900,000 in April
• The global art market has ~$4B per month in volume.^[4]
• Coinbase regularly has ~$3B in trading volume per day
• The Nasdaq does ~$200B in trades daily
• Video game microtransactions: ~$3B per month

We’re still really early on! There is a ton of growth potential for NFTs across a few axes:

1. Existing crypto users
2. Art collectors
3. Asset traders
4. Gamers

You don't need to be first to see a trend to capitalize on it. Facebook wasn't the first social network. Google wasn't the first search engine. Coinbase and FTX weren't the first crypto exchanges.

So no, the bus hasn’t left the station. Hell, the bus isn’t even in the station yet – it’s in the parking lot waiting for the driver to start his shift.

This blog post is NOT investment advice. Do your own due diligence.