Opinion: The next wave of Crypto revival may begin with a “seed round IPO”

Author: knimkar, compiled by: BaihuBlockchain

I don’t think perpetual contracts, stablecoins, or prediction markets will bring crypto back. The premise of what people call “crypto coming back” is simply this: something shows up on-chain that people believe they can make money from—and that they can’t buy anywhere else. That’s all there is to it.

I think the most likely path to make that happen again is an upcoming trend: what I call “seed-round IPOs.” That is: using @MetaDAOProject’s Ownership Coins, together with decision markets, to establish a public trading market for early companies.

My judgment is based on the following beliefs:

1/ I expect more people will try to start businesses in the future, because AI models are lowering the time and costs of making things by orders of magnitude. This is obvious.

2/ For many—even most—companies, getting distribution capability is the hardest thing. In this close-quarters fight, Ownership Coins give founders a new distribution tool: tokens. Anyone who has worked in crypto knows how powerful the “user—owner” mechanism is. Someone who already likes your product—if they can also share in upside gains now—becomes an extremely fervent supporter. A cynical crypto professional might say, “What happened to ICOs back then—we’ve seen this before.” But there’s a huge difference between what Ownership Coins represent and what past tokens represented.

3/ I think the continued expansion of equity fundraising markets will increasingly make public-market participants uncomfortable. Traditional equity IPOs now look more and more like harvest events (you can look at SPCX structures). This is just moving BN ICOs to the NYSE. As for “retail investors can’t participate in OpenAI / Anthropic,” people have discussed that too many times already—at least if there aren’t those absurd SPVs, retail basically can’t get in—so I won’t belabor it.

4/ Retail investors today already have access to a lot of ultra-high-volatility “gambling-style financial products”: 0DTE, mobile casinos, sports betting, prediction-market versions of sports betting, and perpetual contracts. They were trained long ago to chase high-variance outcomes. Instead of continuing to play games with purely negative EV, I can easily imagine the tide turning the other way: retail puts their money into companies they like, use, and are willing to support—and here they might even have some advantage, because they are heavy users to begin with.

Current securities laws make it impossible for early companies to trade publicly at all. Ownership Coins and decision markets provide a workaround: they can allow capital formation to continue while still preserving a certain level of investor protection. MetaDAO is increasingly proving this.

In summary, I believe Ownership Coins can both meet the needs of the growing cohort of entrepreneurs (corresponding to 1/ and 2/) and give investors, especially retail investors, a unique opportunity (corresponding to 3/ and 4/).

Remember, crypto has the two strongest adoption drivers, in order:

A/ Price goes up (see Bitcoin)

B/ Let people access financial products they truly want but previously couldn’t get (see Tether, Hyperliquid)

In my view, MetaDAO and Ownership Coins have already found the solution for B/: enabling people to access early companies’ “seed-round IPOs.” And now we’re just waiting for the market cap of a certain Ownership Coin to run from $100 million to above $1 billion, thereby satisfying condition A/.

As long as MetaDAO runs a result big enough, I think the way early companies raise funding will be changed.

If you think that sounds unlikely, consider this: IPOs themselves have been evolving, now including retail allocations—and I think that trend will only continue. What I’m saying is just that this trend will further spill over into seed-stage companies. Think of it as a more mature version of the 2017 ICO craze.

I can’t wait anymore. We’re really back.

Appendix: yes, yes, I know you want to say “adverse selection”

I admit, the history of crowdfunding and launchpads hasn’t been great, and the adverse selection problem will always show up in various ways; I also admit that what I’m saying is “this time is different.” But I really do think this time is different. Below I’ll address, one by one, some common objections to Ownership Coins.

Adverse selection [1]: Great founders will take the traditional VC route, and only mediocre founders will do seed-round IPOs.

Yes, that’s the biggest risk. Top VCs don’t just pick winners—they also manufacture winners. I think in the future, you’ll see “good VCs” also participating in seed-round IPOs, and MetaDAO’s issuance is already increasingly moving in that direction (VC + retail). So I think truly great seed-round IPOs will likely show a landscape where brand-name VCs and retail coexist. Bookbuilding underwriting for IPOs is already a mature process—we’re just putting companies into an earlier stage.

Adverse selection [2]: Great founders won’t be willing to let decision markets limit their freedom to make decisions.

This deserves a longer discussion, but in short: I believe that over time we will gradually find a balance point in decision markets that is friendly to investors while also being friendly to founders. MetaDAO is already adjusting decision-market design based on feedback (for example, the proposals now put forward by the team have gained a slight advantage). I’m not sure what the final parameter settings for decision markets will be to be optimal, but I think this direction can be tuned gradually.

Adverse selection [3]: The equity market is bigger than the Token market, and the ceiling is much higher. Excellent founders won’t want to cap their upside.

Sure—but I think as long as the asset is good enough, market participants will buy regardless of whether it’s equity or a token. Bitcoin has already grown into a trillion-dollar asset; Hyperliquid has also become a huge asset, and so on. Once again, emphasize that “going up” itself is a powerful driver that’s hard to believe.

Adverse selection [4]: Founders won’t choose to let their assets be publicly traded, because that would distract from everything.

The upside generated by the “user—owner” relationship may exceed the distraction cost of having a publicly traded asset. At least in my view, this isn’t an obvious conclusion: whether there is a publicly traded asset really doesn’t change the final result by a huge amount. I keep seeing that pressure brings out diamonds. After talking with MetaDAO’s founders, I feel many people actually see it as a scoreboard—and also as a source of motivation.

Ownership Coins are just a way to route around securities laws.

Yes, that’s true. But in my view, that’s not a bug—it’s a feature. In crypto, the best products often come with a fairly strong component of regulatory arbitrage, and that is precisely part of why they succeed.

Retail investors are too impatient for VC.

Retail investors are indeed impatient, but I don’t think that matters. For retail investors, volatility itself is the product. And in an early company’s lifecycle, there’s naturally a lot of volatility. My argument isn’t that retail will become very good at VC investing; I’m just saying they’ll participate—and likely at very large scale.