Editor’s note: Andreessen Horowitz’s Crypto Startup School brought together 45 participants from around the U.S. and overseas in a seven-week course to learn how to build crypto companies. Andreessen Horowitz is partnering with TechCrunch to release the online version of the course over the next few weeks.
In week two of a16z’s Crypto Startup School, three company-builders provide real-world advice on using the qualities of crypto to create new business models and networks.
Coinbase founder and CEO Brian Armstrong walks us through “Setting Up and Scaling a Crypto Company,” explaining how crypto can help startups raise money, acquire customers and build a global profile. The issuing of tokens, for example, can align the incentives of early users and reinforce network effects, helping solve the “cold-start” problem that can derail many startups.
Armstrong also outlines the disadvantages of crypto that entrepreneurs must watch out for, including regulatory uncertainty. On balance, he thinks crypto is where the internet was in the early days.
“In five or 10 years, pretty much every startup that gets created, it’s going to use the internet, it’s going to use AI and it’s also going to use some form of cryptocurrency somewhere in that product.”
In the next lecture, Balaji Srinivasan, an angel investor and co-founder of multiple companies, including Earn.com and Counsyl, gives an overview of “Applications: Today & 2025.”
Srinivasan starts off by tracing the history of crypto from Bitcoin and Ethereum to the present. He highlights the crypto applications that have already gotten traction — infrastructure providers such as exchanges, wallets and miners; decentralized finance (DeFi) apps; and stablecoins that eliminate the volatility of early cryptocurrencies — and looks ahead to the ones that are likely to emerge in the next five years. These include personal tokenization, new financial instruments, decentralized autonomous organizations and gaming.
Finally, Forte co-founder and CEO Josh Williams does a deep dive on “Opportunities for Crypto and Gaming.” Williams explains that blockchain technology could have an even bigger impact on gaming than the internet because it’s not just connecting people, but potentially changing business models by aligning the incentives of developers and players. It can do this by allowing players to truly own the assets in games and verify their provenance, and by enabling developers to code rich incentive systems and rewards into games.
By incorporating these mechanisms, Williams believes, an already exploding gaming industry will grow and create multi-billion-dollar marketplaces within games that will truly benefit players and developers.