Peter Thiel's Zero to One book is arguably one of the best ways to understand true innovation. It helped in putting a concept and framework on how innovation can move from non-existence to existence, for me.
Sometimes, it seemed very obvious in hindsight that Innovation X or Y will eventually catch on. During the formative years however, very few people could understand its implications.
Underground Growth
I think there's a needed element of timing for innovation to flourish. This is usually understood as having the right environment or a set of conditions that could make the innovation to stick, reach escape velocity etc.
It's common knowledge that one of the reasons why the iPhone succeeded where earlier smartphones failed was because the necessary components (touch screens, mobile processors, battery technology) had reached the right price and performance levels.
But timing also plays a part in terms of duration. Innovation can't happen overnight, a seed will have to spend time buried underground before it emerges as a sprout.
Maybe not that much of an innovation, but Amazon spent years building infrastructure and operating at a loss before becoming profitable.
Another thing is this element of hype surrounding every innovation. How cool was it for the observers and participants to see humans conquer the air for arguably the first time during the Wright Brothers' historic flight at Kitty Hawk?
I've watched every SpaceX's Starship testflight, and every one of it was accompanied by a shiver running up my spine. I'm not sure if it's hype or just genuine curiosity on my part.
AI As A Foundation
In the crypto space, Olaf Carls on-Wee of Polychain Capital embodies Peter Thiel's Zero to One mindset, for me. I listen to this guy almost religiously and ponder on what he says from multiple angles.
On the recent Token2049 conference, he had a presentation titled Programing Capitalism and the last section was about Novel Mechanisms.
Examples on the latter included:
- Training AIs with Idle Compute(e.g Grass)
- Abstracting crypto-finance with chatbots(e.g Spectral)
- Blockchains designed specifically for AI provenance(e.g Sahara).
Of course, it's mostly on AI, since it's the dominant technological frontier of our time. Arguably also, the most transformative technology since the internet, with potential impacts we're only beginning to glimpse.
But the main theme behind it all is finding unexplored territories in crypto and building fundamentally new things rather than incremental improvements with AI as the foundational layer or force multiplier.
What that means is we're entering an era where crypto and AI convergence could enable entirely new economic models, to say the least.
Excitement And Interest
Instead of simply tokenizing existing assets or processes, novel mechanisms can be created that were previously impossible.
For example, AI models can be super fine tuned to dynamically adjust protocol parameters based on real-world conditions, or smart contracts execute code based on AI-processed real-world data. This bridges much of the gap between these two seemingly different worlds.
Also, I think this could open up possibilities for truly autonomous financial systems that can evolve with market conditions, user behavior, and changing economic(and even broader) environments.
Perhaps, this is how genuine excitement and sustained interest are created in terms of sustainable value creation. Not the fickle novelty memecoins masquerading as sustainable projects with real utility.
Thanks for reading!! Share your thoughts below on the comments.
