The New World: RWA, ETH, SOL, and the Revolutionaries

Hey, it’s him again. Trump has become the next President of the United States, and he is building his cabinet, mostly with individuals who tend to support Crypto.

Like it or not, the world we live in is standing at a critical turning point. The next four years will play a major role in shaping the world order for decades to come.

Never has he felt so excited. This article shares his predictions, and also acts as his preparation for the potential changes ahead.

RWAs and the Liquidity Boom for DeFi

Real World Assets (RWAs) involve tokenizing real-world assets and bringing them onto the blockchain. RWAs (like Noble, Ondo, and Mantra) have emerged strongly over the past year, and this will likely be a key phrase in the years to come.

When an asset is put on the blockchain, one of the most common needs is to use it as collateral. Lending platforms (like Aave, Save, and Scallop) will act as money printers, much like traditional banks. This will trigger a massive liquidity explosion on DeFi applications (like Uniswap, Raydium, Jupiter, and Cetus).

The volume of real-world assets is vastly larger than the value of the entire crypto market today. Therefore, the current circulating supply of stablecoins will not be able to meet this massive demand. This will be the golden era for decentralized stablecoins (like Sky/USDS) or algorithmic stablecoins (like USTC) to show their strength.

When that happens, Oracles (like Chainlink, Pyth, and Tellor) will play a crucial role in maintaining the stability and security of the entire crypto market.

The Tripod Shaping the Future of Crypto

As always, chaos will gradually settle, eventually converging into a tripod system where players check and balance one another, much like the Three Kingdoms era.

While many blockchains will coexist, each serving a specific role, end-users will likely interact most frequently with three major chains: ETH, SOL, and SUI.

Even so, the decentralized world will always be controlled by wealthy elites: with the exception of BTC.

ETH: Ethereum

With its long history and a massive array of applications, ETH will remain a monument in the crypto world for the near future. However, this throne could be shaken at any time by two formidable rivals: SOL and SUI.

With the presence of the ETH ETF, Ethereum currently has the advantage of attracting capital from traditional finance. However, this gap will quickly close when a SOL ETF or SUI ETF is launched. As you might recall, in early 2023, the gap between ETH and SOL was massive. But now, SOL only needs to quadruple to overtake ETH. Once ETH is no longer on the throne, things will move very fast.

With the birth of countless Layer 2 networks, each advertised as designed for a specific purpose, there is little difference overall. Since all are built on ETH, they are limited by Ethereum’s strengths and weaknesses.

These Layer 2s are an advantage, but also a fatal flaw for ETH. They split Ethereum’s liquidity into multiple fragments, making it difficult to run large-scale operations. Thus, he predicts that ETH’s monopoly will gradually be narrowed by SOL and SUI once their respective ETFs are launched.

SOL: Solana

SOL is the direct competitor of ETH. By building with the low-level language Rust, and separating the data layer from the processing layer, SOL is flexible and capable of handling the most complex financial applications.

However, Rust is difficult to master. Building applications on SOL requires significant resources and costs. Consequently, it remains a playground managed by financial elites and large institutions with abundant capital: a land highly favored by traditional organizations.

The SOL team is extremely smart and agile. They are not just talented developers, but also brilliant strategists. It was SOL that initiated the MEME coin movement: Bonk going from an 8 million USD market cap to over 4 billion USD was not luck.

One can say that Solana’s human capital is the key factor keeping the platform resilient amidst rapid global changes.

SUI: The Revolutionaries

SUI is the revolutionary force, the missing piece in the crypto market share. Born late, when the crypto world was largely saturated, SUI learned from its competitors’ strengths and avoided their flaws to quickly capture a substantial market share.

While publishing an application on SOL or ETH costs around 1,000 USD at current prices, this cost discourages independent developers. In the long run, ownership of decentralized applications would fall solely into the hands of wealthy corporations.

SUI is different. By using the Move language (specifically designed for developing highly secure smart contracts and financial applications), packaging a SUI application is extremely lightweight. This makes deploying an application on the blockchain very cheap, equivalent to just a single transaction fee on ETH or SOL.

Because of this, SUI will become a fertile ground for creativity: where any developer can publish their application for just 1 USD. Applications on SUI will therefore be much more interesting and diverse.

SUI is fast, arguably the fastest among current blockchains, boasting a TPS of 297,000. It organizes data uniquely, enhancing user ownership of data. Its ecosystem is virtually complete: all popular applications on ETH or SOL have corresponding counterparts on SUI.

SUI possesses all the elements to become the next SOL. It only awaits a major catalyst from the market (such as a SUI ETF) or a misstep from its rivals to claim more market share.

Side Stories

Below are scattered thoughts on hot topics: AI, Crypto Games, Gold, and Oil.

AI

In science fiction movies, we have often heard about AI taking over the world. One vision of an uncontrolled, powerful AI looks like this: AI uses BTC as its native currency, uses Thorchain (RUNE) to swap into ETH or other platform tokens, and utilizes liquidity pools on Uniswap, Raydium, or Cetus to swap into the tokens needed to pay transaction fees. AI deploys its source code on Filecoin or Arweave protocols, and executes it on Render or IO.net. All of these actions can be carried out by AI without being blocked by any individual or organization.

AI is unlikely to explode in this cycle. Due to safety concerns, many governments may block or slow its development. Meanwhile, the attraction of RWAs is simply too massive.

Blockchain Games: Play-to-Earn

Blockchain games are likely to flourish in this phase. Popular games like Minecraft only need to add a blockchain module to trigger a massive push in this market. He believes society will evolve faster than we can imagine.

Anyone who watched Ready Player One can visualize how the blockchain game world will operate. If you earn money in the game, you will be wealthy in real life. This happened once with Axie Infinity, and it will grow stronger under the Trump presidency.

Gold, Oil, and Nuclear Energy

The handshake between Trump and Elon Musk will likely cause oil and gold prices to fall, as people transition to electric vehicles and store BTC. This will be a major shock to those accustomed to the dominance of gold and oil.

As BTC becomes more popular than ever, the energy required to maintain the system will become a hot topic. People will look to a new solution: nuclear energy. At this point, electricity will become cheaper and more abundant, kicking off a nuclear energy race.

Old alliances will dissolve, and new ones will form. Perhaps OPEC will disappear, replaced by PNEC (Peaceful Nuclear Energy Consortium): a group that sells uranium and targets any nation that tries to produce it unauthorized.

The world turns a new page: Chaos, danger, and hard to control. Or perhaps, Peace, safety, and efficiency.

❤️ cowriter aethery