crypto sure requires a lot of fiat

The TechCrunch Exchange: A Weekly Startup and Market Update

Welcome to The TechCrunch Exchange, a weekly newsletter focused on startups and market trends. This publication is derived from the daily Extra Crunch column, but is offered freely for your weekend review. Interested in receiving it directly? Sign up here.

Let’s delve into discussions surrounding funding, startups, and emerging IPO possibilities.

A Brief Note

Greetings from Friday! It is assumed you are enjoying an extended weekend. In recognition of this, this week’s Exchange letter will adopt a concise format.

The Persistent Rise of Cryptocurrency

If you hoped for a decline in cryptocurrency coverage, the news is unfavorable. Not only are cryptocurrencies remaining relevant, but the financial resources driving their expansion appear to be increasing.

Recent reporting by Eric Newcomer highlights this trend, specifically detailing the growth of the a16z Crypto Fund to $2 billion.

Key Observations

This development brings forth several important points. Firstly, there is substantial Limited Partner (LP) interest capable of supporting a $2 billion crypto investment vehicle. Secondly, a significant number of promising crypto concepts exist, justifying the allocation of $2 billion in funding.

The former point is readily believable, however, the latter requires further consideration. While innovative companies are emerging within the blockchain sector – as evidenced by Coinbase’s Q1 performance – many of the most successful ventures currently blend traditional banking practices with cryptocurrency technology rather than existing solely within the crypto space.

The Pursuit of Experimental Crypto Ideas

As established concepts are refined, we can expect increased investment in more experimental crypto initiatives. As previously discussed in the Daily Crunch, substantial capital is already flowing into these markets:

This dynamic is where venture capital within the crypto ecosystem – and the substantial a16z fund – becomes particularly noteworthy.

While cryptocurrency exchanges demonstrate profitability, the potential of the broader crypto economy remains a key question. Can ventures in this space generate substantial, understandable revenue streams for the traditional financial world, and ultimately pursue public offerings? (And, indeed, do they even desire to go public?)

A Spectator's Perspective

Observing the investment of funds into potentially unsuccessful ideas can be quite engaging. A favorable outcome for some equates to a loss for others – a compelling dynamic!

A Pivotal Moment for Twitter’s Subscription Model (and Content Creation?)

Twitter’s “Blue” subscription service is gradually being introduced to users. A personal decision has been made to acquire the subscription, regardless of its precise features.

However, a compelling thought persists: Twitter is uniquely positioned to foster an ideal environment for content creators. The platform already serves as a central hub for numerous writers, journalists, and artists.

Many creators have already cultivated a substantial following on Twitter. Wouldn't it be logical for the platform to empower these individuals to capitalize on their established presence?

The potential for expansion is evident. Following the acquisitions of Revue and Scroll, Twitter could develop a newsletter platform. This platform could distribute subscription revenue from Blue members directly to writers.

Alternatively, Twitter could consider acquiring Medium, as proposed by a colleague. Medium boasts a significant subscriber base that could be integrated into Blue.

This integration would effectively create an additional, interconnected social network specifically tailored for writers and other creative professionals.

With substantial financial resources, a dedicated engineering team, and a mandate for growth, ambitious initiatives would be undertaken. It remains to be seen what Twitter will develop, but it is hoped that their vision is bold.

For a recap of this week’s coverage on The Exchange, please visit here. Wishing everyone a restful and well-deserved break.

Alex