In crypto there are too many damn wolves

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There’s meant to be two warring wolves within all of us.

But in crypto, there’s so many more than two.

The story goes that whichever wolf we feed the most will grow strong and devour the other. It’s a metaphor for good and evil — nurturing virtue in the soul will scrub it clean of all things fiendish, eventually.

So, which wolf is crypto feeding? Take your pick:

• Permissionless finance and censorship resistance
• Tokenization of all things
• Memecoin casinos
• Public goods funding
• P2P cash
• Wall Street adoption
• DAOs and onchain governance
• Regulated stablecoins and tokenized money market funds
• Incentivizing physical infrastructure networks
• Digital collectibles
• Yield and airdrop farming
• Mixers and privacy tech
• Charity and scientific research
• Crypto-powered smart cities

There’s likely many more that have slipped my mind. Still, what’s clear is this: crypto’s builder culture has conditioned us to believe that it’s possible — and optimal — for all wolves to be fed at the same time and not tear each other’s throat out in the process.

Take the alpha wolves of this particular cycle: Wall Street adoption and memecoin casinos. 

Setting aside the potential for a Dogecoin ETF to bridge the gap between those two concepts, an exceedingly well-fed Wolf of Wall Street Adoption would be far more powerful than mere memecoins in TradFi wrappers on stock exchanges.

Perhaps its final form would involve tokenized stocks, bonds, foreign currencies and all other financial instruments trading round-the-clock on public blockchain rails — and globally accessible to boot. 

Or it is hedge, mutual and pension funds making long-term investments far across the crypto space, rather than just buying and selling bitcoin for its volatility (or ill-timed investments in centralized lenders and exchanges).

At this moment, it’s difficult to imagine either scenario playing out — as much as I might like them to — because the Wolf of Memecoin Casinos is simply far too big right now.

Take the first facet of adoption: the fulfillment of Larry Fink’s vision of tokenization as the “next generation for markets.” 

Wall Street has already burned through the idea of porting finance to permissioned blockchains. But public chains in their current form, especially ones that have pushed for a decent degree of decentralization, often barely withstand major influxes in activity before service degrades.

It’s happened on Ethereum, Solana, Base, XRPL and others when memecoins were broadly super hot, but more recently Solana infrastructure chugged solely around two big memecoins: TRUMP and MELANIA.

Maybe they’d use their own layer-2s or layer-3s, but essentially, Wall Street would want to adopt networks that can handle many, many more wildly popular assets all at once, and not have to compete against memecoin traders to use the chain.

As for the second — funds investing in crypto long-term like they do with stocks and bonds — they will no doubt base those decisions on fundamental metrics, like Blockworks Research’s Real Economic Value (REV), which points to memecoin trading as the prevailing avenue for accruing value in public blockchains right now — even if they can only handle so much of it.

Is investing in crypto infrastructure powering profitable onchain casinos enticing enough for old-world financial institutions? Maybe some.

I’d still bet more would jump if another one of crypto’s rabid wolves were properly fed.

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