AllianceDAO: 30 Crypto Entrepreneurship Directions in 2024

Author: Qiao Wang, co-founder of Alliance; Translator: Golden Finance xiaozou

< p style="text-align: left;">Here are some cryptocurrency startup ideas and topics that AllianceDAO is excited about in 2024. This list serves two purposes: to encourage builders to apply to join our community and receive funding, and to inspire you if you're not sure what to build.

1, "Real World"Financial Applications

(1) Crypto Payments

Stablecoins are the first and only cryptocurrency The largest non-speculative use case to date.

According to a report by Brevan Howard Digital, “In 2022, the on-chain settlement amount of stablecoins will exceed US$11 trillion, crushing PayPal’s settlement amount (14,000 billion), surpassing Visa in payment volume and reaching 14% of ACH settlement volume.” It always baffles us that cryptocurrencies haven’t found a killer use case outside of transactions.

We believe that crypto payment startups should not compete with the likes of Venmo or Revolut. Instead, they should identify and focus on underserved user groups, such as traditionally underbanked industries (often taboo industries) or cross-border payments.

For example, we are particularly interested in stablecoin payment applications in Latin America, Africa, the Middle East, South Asia, and Southeast Asia, where fiat currency devaluation and scrutiny are more universal. We gained a lot of data insights from talking to startups, indicating that stablecoin adoption is having a hockey stick effect in these parts of the world.

(2)“BinanceP2P” in developing countries or "Local Bitcoin"

However, in order to make crypto payments accessible to these parts of the world To be available to consumers, it needs to solve the last mile problem, that is, the deposit and withdrawal channels with local legal currencies. Otherwise, the recipient will not be able to use the payment in "real life" and the sender will be restricted to being crypto-natives.

There is a solution for this similar to Binance P2P or native Bitcoin, where a network of agents helps complete deposits and withdrawals in a peer-to-peer manner.

(3) Crypto neobanks in developing countries

These neobanks were all the rage 2-3 years ago, but few of them were able to focus on the disproportionately strong demand for stablecoins and yields in developing countries.

We are very excited about the idea of ​​providing stablecoin benefits to consumers in developing countries. Although the market is quite crowded in some parts of Latin America, we continue to believe there are opportunities globally.

Another tailwind is the proliferation of on-chain real-world assets (RWA) (such as U.S. Treasuries), which makes yields uncorrelated and often higher than Aave and Compound’s crypto-native yield. These RWAs make high-quality assets from developed countries more accessible to developing countries.

(4) Real World Assets (RWA)

The current value of on-chain wealth is $1.5 trillion. What such large-scale on-chain wealth seeks is diversification.

· Since the 2023 banking crisis, on-chain asset diversification has become an urgent issue for many crypto-native organizations. MakerDAO is leading the way in this regard.

· Crypto-native speculators are now wealthy enough that they also want to diversify their holdings outside of highly correlated crypto assets.

· Consumers in emerging markets want to own high-quality assets. Today, they have USD stablecoins, which are better than their national currencies but still suffer from endless depreciation.

The types of RWA we are interested in include but are not limited to:

· Financial assets , such as treasury bills, stocks, corporate bonds, etc.

· Hard assets such as real estate and commodities.

· Collectibles such as watches and Pokémon cards.

(5)RWAMortgage

Another role of RWA is to allow off-chain assets (such as real estate, treasury bills, or other RWA) to be used as collateral.

The obvious approach is to tokenize the asset and treat it as on-chain collateral. Such as 4K tokenizing watches and using watch NFTs on Arcade to obtain USDC loans. When all asset classes in the world are on one ledger, we can greatly improve the lending experience. Any asset can be used as collateral to borrow against any other asset. This was not possible before the advent of cryptocurrencies.

But it is also possible to abandon tokenization. Maybe keep just one oracle, or less. Maker is an example. They effectively created a collateralized debt position, DAI, partially backed by RWA (the vault keeper), but their RWA position was not tokenized.

Another potential example is the capital efficiency of RWA using funds in cryptocurrencies without fully tokenizing them.

2, crypto-native financial applications

(1 ) Continuous prediction of the market

Most people want continuous unlimited upside. They don’t want to be limited by the discrete binary outcomes of traditional prediction markets. We believe that the true crypto-native prediction markets are actually memecoins in the form of ordinary fungible tokens, such as BIDEN and TRUMP.

(2) Low mortgage loan

With On-chain reputation becomes increasingly important, making low-mortgage loans possible. In fact, most business loans in TradFi are not fully secured.

A number of recent developments are making lower mortgages increasingly feasible:

· Off-chain authentication, such as Coinbase or Clique.

· The increasing adoption of ENS and other domain names.

· More and more people are getting on-chain cash flow on a regular basis.

A specific example of low-collateral loans is to enable individuals or organizations on the chain to borrow against future cash flows.

(3) PrivacyDeFi

Privacy can often find PMF (product market fit) in unexpected places. For example, whale users also use centralized exchanges to anonymize their transactions. We even suspect that Thorchain, which performs cross-chain exchanges, is actually a privacy solution.

In any case, we are interested in new solutions to this old problem. For example, zero-knowledge proofs (ZKPs) can be used for compliance verification (proving that the user is not a citizen of a sanctioned country or that the identity is recognized) without breaking anonymity. We are also interested in other technologies such as multi-party computation (MPC), fully homomorphic encryption (FHE), and trusted execution environments (TEE).

(4)RariRestart

We understand that many vertical projects around the world have launched their own lending platforms by forking and modifying Aave or Compound. Significant costs are incurred when it comes to development, auditing, and maintenance. Reducing this cost at scale is the original theory underpinning Rari Capital, which can be thought of as "Aave/Compound forks as a service." But now that Rari is defunct due to a hack, there's an opportunity to fill the void once again.

(5) Provides M&A investment banking services for DAO

In 2021, Fei Protocol merged with Rari Capital. This won't be the last DAO merger we see. There will be more DAOs in trouble, and more DAOs will want horizontal or vertical mergers and acquisitions. Some have the opportunity to build reusable tools (smart contracts and legal structures) to facilitate this process and make it more sophisticated.

(6)NFTDerivatives

NFT options, perps (perpetual futures contracts), and futures can help NFT holders hedge their positions, or just speculate on the price of NFTs.

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Due to the illiquidity of the underlying, index prices are difficult to calculate and easy to manipulate. Therefore, physically settled derivatives may be the right design choice.

(7) Prime Brokerage

Capital efficiency is affected The following practical limitations: There is no agreement to engage in mutual discussions of risks. Perp protocol A does not care whether you have implemented a hedge against lending protocol B.

One ​​approach is to pool assets into one large account per protocol. Create an accounting layer to handle risk for each customer account. Is there a better way?

3, non-financial or semi-financial applications

（ 1) Full-chain games

On-chain games refer to the entire game state and game logic (not just currency and NFT, etc. In-game assets) are written to the blockchain.

Come and see Tic-Tac-Toe. The concept of turns, a 3x3 board, players and the skills of connecting three pieces must be recorded as rules and never change. The player's operation history must also be recorded. On the other hand, the color of the chessboard and chess pieces, the shape of the chess pieces (X and O can become Y and Z), animations, sounds, etc. can all be saved on the client.

Putting all state and logic on-chain unlocks a variety of new behaviors:

· The game is played by smart contract players (playing against human players). One of the earliest examples is actually MEV in DeFi. Trading is a gambling game, and MEV robots are players based on smart contracts. Note that in this case smart contract-based players compete not only with each other, but also with human players.

· Create game mods by third-party developers without worrying about platform disruption. Mods are the lifeblood of Web2 games, and many long-lasting games started with mods (such as Dota 2, Counter-Strike, and PUPG). However, due to the licensed nature of Web2 games, mod developers are constrained by the original game company. In fact, many games either quit the platform or never started modding for fear of being forced off the platform.

Eventually, game companies may become game publishers. Looking at the history of Web2, it is likely that the first successful on-chain game engine will come from a successful on-chain game company. Think Unreal (engine) and Epic Games (game company). In the same way, the first successful crypto game publisher may also come from a successful crypto game company. Think Steam (publisher) and Valve (game company).

(2) On-chain social network

Winner Web3 Twitter will finally deliver the features we've all been waiting for: user-owned data, client diversity with permissionless features, and/or resistance to censorship.

There is only one problem. If history is any indication, it's unlikely that the first successful Web3 Twitter was planned from the outset to be the next Twitter, or to look like Twitter. Maybe Web3 Twitter will start as a game, a DeFi super application, or something novel, seemingly unreasonable and even ridiculed, or so outrageous that many people feel uneasy. The weirder or more controversial your product is, the more people will want to try it!

(3) Anonymous social network

Online social network A specific example of this is anonymous social networks, where individuals use zero-knowledge proofs to verify their identity, say, that they are an employee of company X or have a net worth of more than $Y. Anonymous gossip is always welcome. Think back to Ratemyteachers in the early days of the Internet.

(4) Personal Tokens

Although BitClout et al. The experiment failed and there was much drama surrounding friendech, but the concept of personal tokens was fundamentally novel because it enabled people to speculate on a new, potentially massive asset class. We hope this idea can be developed further in the future and find product market fit.

The most interesting thing about Friendtech is not alpha sharing, private groups or social networks, but that it solves social consensus. Suppose 5 people create 5 different common ERC20 tokens called VITALIK, which one is the "real" VITALIK token? Friendtech solved this problem by requiring creators to log in using their official Twitter account. In this way, social consensus was resolved.

In other words, Friendtech combines two unrelated concepts into one: alpha sharing and token speculation. What if we separated the two and just focused on individual token speculation? Alpha sharing already exists on a large scale in Web2 in the form of Substack, SeekingAlpha and Telegram paid groups.

(5) Creators and luxury brands

For For these user groups, blockchain can basically play two roles. First, they can be factories for digitally native products. Image-based NFTs (e.g., PFP and generative art), language-based NFTs (e.g., novels), or audio-based NFTs (e.g., music) are all examples of digitally native products. They offer creators and brands a new way to monetize their brand and artistic prowess. To buyers, these NFTs are speculative collectibles, and to early adopters, they are undervalued carrots. But the creator/brand can also decide whether to offer benefits such as exclusive access and royalties.

Second, they can be a database of redeemable receipts for physical goods. For example, a pair of Nike sneakers could have a physical chip built into them that is digitally connected to the NFT. Some people call it "phygital", while others call it "digital twin". You could even think of it as a “RWA.” On-chain reproduction of physical goods provides creators/brands with a new channel to attract customers, with customers having strong guarantees against counterfeit products and the asset itself potentially leveraging existing DeFi/NFTFi infrastructure (e.g. lending).

We are very interested in startups that are starting out in a specific creator or brand vertical and we help them deliver new experiences to their customers. The narrower the vertical, the better.

(6)10k PFP

Despite its simplicity, PFP will likely remain the dominant NFT category for some time. The key point here is that there are already large distribution channels for these NFTs, namely Twitter and other social networks, and NFT holders can use their Punks or Pudgys as their PFP.

Let’s compare PFP with game NFT, music NFT and other NFT. Game NFTs require new games to provide native support for their construction and mass adoption, or existing popular games to embrace them. Music NFTs are not supported by Spotify, YouTube Music or Apple Music. You can show off your generative art NFTs on Twitter, but it takes a tweet to do so, which gets buried after 24 hours. But your PFP is persistent, it’s there every time you tweet, or every time someone visits your profile.

PFP is the most boring and exciting category of NFT.

(7) Habit Development Application

StepN has Demonstrates that token incentives can effectively motivate people to develop healthy habits. This might include things like running, sleeping, meditating, dieting, or learning new things. Some studies show that it can take anywhere from 18 to 254 days for a person to form a new habit, with the average taking about 66 days. Overcoming the initial hurdles may be difficult for many, but financial incentives in the form of tokens may give people the motivation to stick with their new habits and make them a permanent part of their lives.

（8）DAODigital Nation

The ultimate outcome of cryptocurrency will include weakening the role of state power as the basic organizational unit of humanity.

Cryptocurrency allows us to realize property rights through encryption, constitution and laws through smart contracts, taxation through token issuance, national currencies through cryptocurrencies, and Decentralized governance enables transparent decision-making and international trade through DeFi.

The idea is to start with an online community where members share common interests or beliefs, have a well-designed governance structure, and have avenues for economic growth. Most DAOs don’t realize this yet, but they are actually developing into digital nations.

(9) Decentralized scientific crowdfunding

One of the biggest problems plaguing the scientific community is the lack of funding. The lack of funding stems from the risky and speculative nature of scientific discovery. Crypto capital, on the other hand, is risk-seeking, open to new speculative ideas, and capitalized on a massive scale. The idea is to pair up both parties.

Although "ICO" has a bad reputation, it is fundamentally one of the biggest ways to unlock cryptocurrencies.

(10) Decentralization23andMe

Another major challenge, especially in the health sciences, is the lack of sufficient data sets to test scientific hypotheses. One possible solution to this problem is to use tokens to incentivize individuals to contribute health data to scientific research and drug development.

For example, individuals can share their genotype and phenotype data, creating a decentralized version of 23andMe, and participants will be rewarded for their contributions. Another example is sharing physical activity data, heart rate, sleep data and other types of data collected by wearable devices. Universities, hospitals, and pharmaceutical companies can access this data through the Research Marketplace and the Commercial Applications Marketplace.

(11) Open market-oriented scientific publications

Another futuristic idea in decentralized science is the use of cryptographic primitives to disrupt scientific journals. These journals have traditionally been stewards and disseminators of scientific research. But curators are often beset by improper motives, and distributors are often required to pay. Perhaps cryptocurrencies can help create open, market-driven scientific journals. For example, each paper automatically comes with a prediction market about the completeness of the research or the probability that the theoretical recommendations will translate into real results.

(12) DecentralizationGLG

Consulting networks like GLG ($650 million in annual revenue) are a popular way for people to request help from very specific experts who can't work as full-time professional consultants but still have extremely valuable insights to share. These networks are heavily monitored and regulated, limiting the value of the network and creating a general chilling effect on products. Cryptosocial networks like Friendtech have emerged, which at least demonstrate the possibility of niche thinkers sharing expertise. We believe that cryptocurrencies, with their ability to protect privacy, resist censorship, and transfer value, are ideally suited to reshaping the professional consulting space.

4, Infrastructure

(1）DePIN

Tokens have proven to be a phenomenal mechanism for coordinating large-scale human activities. We are very interested in startups that use tokens to incentivize people to build:

· Telecom Networks

· Clean energy infrastructure

· Artificial intelligence training big data set

· Other areas we haven’t thought of yet

This is widely known as Physical Proof of Work (POWP) or decentralized physical foundations Facility Network (DePIN). Take renewable energy as an example. Because energy sources such as wind and solar are intermittent, they are unpredictable at certain times. Batteries can help solve this problem by storing excess energy for emergencies. The more batteries connected to the public energy grid, the more useful they are. The PoPW/DePIN network uses token incentives to encourage households to deploy their batteries and pool them for later use.

(2) Fighting against AI deep fakes

ChatGPT may have stolen the thunder from generative AI models focused on generating images, audio, and video. However, these models are currently capable of producing realistic deepfakes. The recent AI-generated Drake song is a great example of just how far these models can go. Since humans are programmed to believe what they see and hear, these deepfakes pose a significant threat. There are many startups trying to solve this problem using Web2 technology. However, encryption technologies such as digital signatures are better suited to solve this problem.

In the crypto world, transactions are signed by the user's private key to prove their validity. Likewise, whether it’s text, pictures, audio, or video, its authenticity can be proven through the signature of the creator’s private key. Anyone can verify the signature against the public address provided by the creator on their website or social media account. Crypto Networks has built all the infrastructure needed for this use case. Many high-profile VCs and hackers have linked their existing social media profiles to encrypted public addresses, lending credibility to the use of digital signatures as a content authentication method.

The product we would like to see is a protocol that integrates with existing social networks so that when a creator posts and signs a piece of content, the protocol automatically Verify digital signature.

(3)ZKPHardware Accelerator

Specialized hardware companies that target specific use cases and establish early market leadership can ultimately become very valuable companies. Nvidia has become the most valuable semiconductor company in North America thanks to its focus on AI hardware, which shows that this is true for the AI ​​field. The same is true in the field of Bitcoin mining, where Bitmain, Canaan, and Whatsminer became unicorns by focusing on ASIC mining machines. Companies that design and manufacture efficient ZKP hardware accelerators will follow the same trajectory.

(4) DedicatedZK computing network

Current ZKRollups (such as ZkSync and Starknet) are universal. However, it is possible to create dedicated ZKRollups that use faster and cheaper ZK circuits. For example, if an application is an order book-based DEX running on ZkRollup, then it only needs to perform the circuitry of order creation, cancellation, and matching. In this case, an ideal ZkRollup should be optimized for these operations and nothing else.

Another example is the off-chain AI computing network for on-chain settlement. Because AI inferences may be too expensive to run on-chain, they need to be run off-chain. But how do you prove that the model is working correctly? By using specialized ZKPs optimized for operations such as matrix multiplication.

(5) BitcoinL2 and MEV

While we don’t know if Bitcoin L2 can inherit the security assumptions from the underlying L1 without a fork, we are interested in adding more to smart contract functionality on Bitcoin. Very interested in the general idea of ​​representation. The point is simple. With $1 trillion worth of wealth in Bitcoin, there will be at least some Bitcoin holders who want to do something trendy, fun, or productive with their Bitcoins rather than just holding them. To enable these use cases, Bitcoin needs a more programmable layer.

Many existing and upcoming Bitcoin L2s are committed to maximizing alignment with Bitcoin L1. One approach is to use Bitcoin L1 for data availability and delegate L2 transaction ordering to Bitcoin miners. This means that the extraction of MEV will be in the hands of miners. Similar to Ethereum, there is an opportunity to build large-scale companies similar to Flashbots that work with miners to order transactions in some way or execute Bitcoin transaction packages. If Bitcoin L2 were to become a reality, the company building the dominant L2 MEV extraction platform would easily become a unicorn.

(6)SolanaInfrastructure

We are optimistic that Solana’s engineering-driven monolithic approach can be an alternative to Ethereum’s modular research-driven modular approach. However, Solana's infrastructure is still in its infancy. There are potential opportunities to build better development tools (e.g., Solana’s Foundry), smart contract wallets, block explorers, on-chain data indexers, and other areas we haven’t thought of. Solana infrastructure developers have the opportunity to build specifically for Solana while learning from past mistakes of other chains.