A sweeping FBI probe into illegal sports betting landed dozens of arrests that include high-profile NBA names, MTV winding down several international music channels, and Amazon’s cloud keeps going down while your subscription prices keep going up, and Texas teams own the AP Top 25. Let’s dig in.

MTV Shuts Down Music Channels Outside Of US

MTV was once a cultural juggernaut, captivating audiences and shaping culture for the younger generation through music, and representing the authenticity of the human experience with their MTV Animation phase. MTV is pulling several of its music channels out of markets outside the U.S., a clear sign that scaled linear TV is on its last leg.

They say the way people consume content has changed. Which is true. Apparently they’re actually writing shows now, dumbing down the plot, explaining everything that’s happening in dialogue, because they know people will be on their phones while watching. That’s not the type of thing that breathes life into a story. No wonder over the last few decades it seems like the soul has been sucked out American media.

I’m not gonna lie, I want the old MTV back. Going back and watching slice-of-life shows like Downtown, Daria, and Mission Hill*, take you back to a simpler time with more raw authenticity that’s missing from day-to-day life today. But cost and retention are real concerns when running a business, and being a profitable voice of a generation is hard.

MTV’s move to reality and viral TV is probably the reason the main network is still up and running today. Vice is another example. As a thing scales, it’s harder to maintain its essence. Smaller, nimble programming blocks like Adult Swim have survived by finding a fantastic partnership and not scaling; that model looks more sustainable than big-budget mass programming right now.

AWS is down again

The internet hiccuped again when a major AWS problem took down big services multiple times last month. For a company that accounts for over 1% of US GDP, with over 1 million US employees, should have some level of accountability, or we should remove this single point of failure as a bottleneck. Their footprint is massive. They even have an effect on prices for streaming services. When AWS raises their prices, Netflix and other services pass that cost down to the customer. As Amazon cuts tens of thousands of employees and automates, which would have a material impact on our economy, some hard questions will have to be asked.

Sports

FBI arrests 30 NBA Players & Staff in Multiple Gambling Scandals

The FBI’s sweep led to more than 30 arrests tied to separate gambling investigations, and it includes high-profile names, including Portland coach and Hall of Famer Chauncey Billups and Miami Heat guard Terry Rozier.

Prosecutors say Billups was involved in lavish, rigged poker games run by organized crime, with high-tech cheating tools that sound like something out of a movie: X-ray card tables, modified shufflers, chip-tray analyzers, and glasses or contact lenses that could reveal opponents’ cards. Federal filings allege the scheme defrauded players of millions. Allegedly, multiple mafia families are invovled. They’ll go after NBA stars, but they’re either too afraid of or too involved with the mafia to arrest them.

Rozier was arrested in connection with a separate sports-betting case. According to charging documents, investigators allege he shared confidential NBA information and tipped associates about in-game exits and other details that could be used to manipulate prop bets. He has been placed on leave while the case proceeds.

Adam Silver has warned publicly about the “dire risks” gambling poses to the integrity of the game. The cases and concerns come just as the NCAA decided to allow college athletes to bet on sports. They had to push back the effective date for the rule change to November 22, after blowback from coaches and conferences worried about integrity.

Texas Takes Over AP Top 25

Speaking of college sports, Texas is flexing: multiple programs remain in the AP Top 25 and new teams are pushing for attention, and Texas is the only state with 4 teams on the list. The regular-season matchups coming in November could reshape the picture, so keep an eye on UNT and the big Texas clash with A&M later this month.

The middle class is at risk. Let’s be real.

The post-Covid bounce in the economy was short lived. Inflation eventually caught up to consumers. Shareholders’ appetite for relentless growth has driven shrinkflation, and an AI push could result in large firms that operate with far fewer people than before. I explored that trend in my last piece on AI and the Social Contract.

You can see the contradiction everywhere. Stock indexes have been hitting record highs while hiring and planned hiring are weakening, with some measures of hiring at levels we haven’t seen since the Great Recession. When asset prices and labor market signals pull in different directions, the middle is the squeeze point.

McDonald’s CEO Chris Kempczinski warned on CNBC that “it’s really kind of a two-tier economy,” noting that upper-income households (roughly those earning over $100k) are seeing different effects than middle and lower-income consumers. Bank of America’s October 2025 Consumer Checkpoint report backs that up. It highlights a clear gap in spending growth and financial resilience between higher and lower-income households. A “tale of two wallets,” as they put it.

Walk the grocery aisle and the proof hits you in the cart: packages are smaller while prices stay the same or go up. That’s shrinkflation, and it has been on the rise since 2021 as companies trim size or servings to hold prices steady.

If the currency and asset dynamics push more of the next generation away from homeownership while top 10% grows their asset power, we need practical escape hatches for the bottom 90%. That’s where micro-economies come in.

A Texas Lens on The Issue

This two-tier squeeze is visible across Texas, from big metros to smaller neighborhoods. In Houston, the closure of Funplex in Alief this year is a blunt example. The nearly 200,000 square foot family entertainment center shuttered and auctioned off arcade cabinets, go-karts and props; a casualty of rising operating costs and weaker attendance for big footprint, mid-market venues. That kind of loss isn’t just nostalgic, it’s an economic signal. Family-oriented third spaces already run on thin margins, and they’re the first to disappear when the middle class starts to shrink.

Houston’s restaurant landscape shows the same pressure. Longstanding staples like Picos & Razzoo’s have closed or gone bankrupt, showing that beloved local spots can be pushed under by rising rent, wages and insurance. Meanwhile, luxury retail and high-end restaurants in well-heeled neighborhoods prosper. From the colorful houses that used to line Rainey St. in Austin, to local entertainment like Peter Pan Mini-golf (Austin) and Funplex, there has to be a way to sustain the establishments that give our neighborhoods character.

Think Micro

Micro-economies are not a radical idea. They are a practical hedge against centralized, extractive scale. The modern economy is increasingly made of these niche markets built around specialized communities and interests. The internet era has unlocked novel ways to create value, built on top of existing industries, loyalty, trust, and fandom. They come in all shapes and sizes and can graduate with mainstream adoption.

Modern creators and streamers on platforms like YouTube and Twitch can turn audience engagement into income. Savvy card collectors can monetize their fandom. Traders can turn their knowledge into profit in prediction markets. Every micro-economy is an economic release valve.

In effect, micro-economies provide diversification and new income streams that more people can tap into. As traditional jobs become less secure, fans and creators rely on these alternative asset classes to survive and thrive. I discuss this more in The Case for Microeconomies.

Prediction Markets Are Here To Stay

Prediction markets are not a fringe toy anymore. They’ve had their iPhone moment. Shows, streamers, sports broadcasters, and major exchange operators are now part of the story.

South Park even ran an episode about them and Tom Brady name-dropped Polymarket on a live NFL broadcast. Prediction markets let you bet on anything from how long the government shutdown will last to how many views Mr. Beast gets on his next video. The notoriety and the volume on these apps are way up.

The story of Polymarket, the largest on-chain prediction market plays like a movie. Last year, federal agents raided Polymarket CEO Shayne Coplan’s home, seizing electronics in an investigation into them allowing US users on their platform before they got a license. Just a year later, Intercontinental Exchange, owner of the New York Stock Exchange, moved to invest up to $2 billion in Polymarket. They now have a license to operate in the US.

Prediction markets raise big questions: market integrity, regulatory frameworks, manipulation risk, and whether information markets improve forecasting or just monetize noise.

AI Acceleration

AI is reshaping work, education, and culture, fast. Experiments like Alpha School’s two-hour learning model show how adaptive software can turbocharge outcomes in boutique settings, but the price and scalability questions are real.

ChatGPT recently hit ~800M weekly active users, a reminder of how ubiquitous these tools have become. And it’s being used in crucial circumstances. A Top US Army general says he’s using ChatGPT to help make key command decisions. AI is almost guaranteed to make mistakes given enough time on a task. Consulting giant Deloitte has agreed to refund part of a $290,000 consultancy fee to the Australian government after admitting that a report it delivered, which included AI-generated content, was riddled with fabricated citations and misattributions. We must take care when we use these tools, and remember that AI multiplies productivity if you supervise it, and multiplies mistakes if you don’t.

Are We In an AI Bubble?

Harvard economist Jason Furman has warned that U.S. GDP growth in the first half of 2025 is being propped up by data center investments. Without them the U.S. would’ve been at a measly 0.1% GDP growth. Growth concentrated in a tiny slice of the economy can leave most sectors exposed if that spending slows.

Sports

A new study from the University of Texas at El Paso finds that officiating calls from 2015–2023 disproportionately favored the Kansas City Chiefs in high-leverage moments, a claim that has reignited long-running debates about parity and the theater of officiating. Back in February, The NFL referees association pushed back hard, calling bias claims were “insulting” and stressing weekly performance reviews and grading of crews. Whether anything has changed is up for debate, with instances of inconsistent taunting calls and missed or called-back OPI flags in recent weeks.

This week Texas A&M (#4), Texas Tech (#7), and Texas (#21) are all ranked in the AP Top 25, a great moment for the Texas. Both the Red Raiders are 6–0 and Texas A&M are 6–0 and it’s their best starts in over a decade. The last time Texas had 3 teams ranked was in 2011 (Baylor, Texas, and A&M). Texas and Tennessee are the only states with three teams currently ranked, and Florida and Alabama are the only other states to have achieved this feat.

Last month, a small town museum in Ohio advertised a single opening for an administrative assistant. Within forty‑eight hours more than four hundred résumés poured in: from mid‑career librarians displaced by digital catalogues to fresh graduates hunting for a first paycheck. Their desperation is not an isolated event. The New York Fed pegs recent‑graduate unemployment at 5.8%, while Oxford Economics finds that entry‑level tech posts are vanishing fastest of all.

Artificial intelligence has poured jet fuel on a slide the American middle class has been riding for half a century. The debate is no longer whether we need a new social contract—it is whose vision will set its terms.

OpenAI’s mission is “to ensure that AGI benefits all of humanity.” Yet the guardrails that might guarantee broad dividends remain hazy. If public institutions can’t keep pace, how do we hold AI giants accountable, and how do we keep the promise of the American Dream alive for ordinary workers?

The Slow‑Motion Unraveling of the Middle Class

In 1970, working‑class families captured roughly 62 cents of every U.S. dollar created. By 2020 their share had slipped to 42 cents. Wealth, meanwhile, has consolidated upstream. The top 10% now own 93% of all stocks. Even six‑figure earners feel the squeeze: almost half live paycheck to paycheck, and one in five households making $150 k still juggle grocery bills against mortgage payments. Instead of getting ahead, families now watch their savings stall, their dream of buying a house fade, and their daily finances drift into a constant state of emergency management.

Two Diverging AI Philosophies

Sam Altman: Rewrite the Contract

At Geneva’s AI for Good Summit last May, OpenAI CEO Sam Altman argued that the potency of frontier models would eventually “require some change to the social contract” as society re‑tools safety nets for an era of abundant machine labor. He has floated ideas ranging from universal basic income to "universal basic compute"—fancy jargon for a free plan once they achieve AGI (Artificial General Intelligence, refers to an AI system with the ability to perform any intellectual task that a human can—i.e. we don’t need humans anymore).

Dario Amodei: Preserve the Contract

Last week, on Anderson Cooper 360, Anthropic CEO Dario Amodei struck a different chord:

“There’s an inherent social contract in democracy where the ordinary person has leverage because they’re contributing to the economy. If that leverage goes away, it’s harder to keep democracy itself working.”

Amodei urged lawmakers to contemplate targeted AI taxes and profit‑sharing before inequality metastasizes:

“I wouldn’t exclude the notion of levying a tax on AI companies. If AI creates huge total wealth, a lot of that will by default go to AI companies and less to ordinary people. Definitely not in my interest to say that, but I think this is something we should consider and I think it shouldn’t be partisan“

Why the Distinction Matters

Both leaders concede that generative AI eventually will vaporize broad bands of entry‑level knowledge work. Amodei projects that up to 50% of such jobs could disappear within five years—about one‑fifth of the entire U.S. workforce—an unprecedented outcome for a developed nation, let alone a G7 member. The tension between rewriting and safeguarding the social contract will shape whether AI deepens or diminishes democracy’s economic foundations.

Power Accelerates, Institutions Lag

Inside Big Tech, AI already writes roughly a third of Google, Meta, and Microsoft’s production code; engineers at OpenAI and Anthropic give estimates closer to eighty percent on their own teams. Shopify’s Tobi Lütke tells employees to “prove AI can’t do the job before we hire” and there's a race to own the most AI agents—Salesforce's CEO Marc Benioff vows his company will be “the No. 1 digital labor provider, period,” while Google and Meta are "creating one million AI programmers" according to Eric Schmidt.

The public sector can't keep up. U.S. K‑12 curricula update every six years while foundation models leap generations every six months. A two‑year‑old micro‑school in Texas, built around AI tutors, already ranks in the top two percent of state exams on two hours of daily instruction proof that yesterday’s classroom template is obsolete.

Historical Flashpoints

Past technological shocks show that bold policy can ease dislocation. Britain’s Factory Acts limited child labor and capped brutal hours within a decade of the power loom’s spread. Germany’s Bismarck launched employer‑supported health and pension insurance in the 1880s to stabilize an industrializing society. The lesson: waiting for market forces alone to self‑correct invites Dickensian outcomes.

Revival Playbooks

 Medici‑Style Patronage (Top‑Down)

Fifteenth‑century Florence funneled roughly seventeen percent of Medici Bank profits into public art and engineering, financing cathedral worksites that employed three percent of the city. Dario's AI tax could be a modern parallel, caching one to five percent of gross AI revenue into a National Workforce Transition Fund. This mirrors Britain’s apprenticeship levy by financing stipends, retraining, and seed capital for worker‑owned startups.

Supplemental levers include data‑royalty trusts (citizens share in model‑training proceeds) and profit‑linked tax rebates for firms that devote at least five percent of earnings to employee dividends.

 Loaves‑and‑Fish Micro‑Economies (Bottom‑Up)

Grass‑roots experiments already hint at local resilience. A Denver tech‑workers guild routes contracts through an AI matchmaker and keeps ninety‑two percent of fees in member pockets, Brooklyn’s DataUnion licensed community‑owned data for $4.2 million in 2024, and Detroit’s OpenFactory lets former auto workers co‑own modular AI‑driven production lines, boosting wages by twenty‑two percent. These micro‑economies recycle profits instead of siphoning them to distant boards.

Rethinking Layoffs in Real Time

Not every company that replaced humans with chatbots is celebrating. Klarna axed seven hundred support agents only to rehire when customer satisfaction tanked. IBM’s “AskHR” bot failed to handle nuanced disputes, forcing a partial rollback. A 2025 survey shows 52% of firms now regret hasty AI cuts. The moral: human agility, judgment, and empathy still underpin durable value.

Call to Action

We stand at a fork: a renaissance of shared prosperity—or a gilded age of concentrated power. Should we change the social contract, as Sam Altman suggests, or save it, as Dario Amodei insists? The answer will hinge on citizens’ resolve to demand equitable stakes and on lawmakers’ courage to tether exponential technology to democratic values.

The next decade will decide whether AI becomes the great leveler or the ultimate wedge. The choice, still, is ours.

Business

FED Makes First Rate Cut Since COVID

This month, the Federal Reserve made its first interest rate cut since March 2020. The FED reduced its key interest rate by 50 basis points, half of 1%, bringing the rate down to a range of 4.75% to 5%. This decision follows a period of aggressive rate hikes aimed at taming inflation, which had peaked at 9.1% in 2022. With inflation now near the FED’s 2% year-over-year target, the central bank has turned its attention to supporting a weakening job market. Officials indicated that more rate cuts are likely before the year ends.

While officials have been cautious about labeling the current economic state as a recession, data such as two consecutive quarters of negative GDP growth suggests otherwise. This measure has been a reliable recession indicator since 1948, and denying it may appear more political than factual. Despite pushback from the White House, which highlights strong job growth, many economists and voters believe we entered a recession before 2022, as the U.S. also experienced two consecutive quarters of negative GDP growth in 2020. The FED’s recent pivot to rate cuts indicates a shift toward stimulating growth, potentially signaling the start of the recovery phase.

Texas Y’all

Elon Musk Furthers His Takeover Of Texas, Declaring Bastrop As HQ For Social Media Company X

If you didn’t know already, Elon Musk loves Texas for its tax laws and general regulatory landscape. In July, he vowed to move all his remaining companies here. Now, all but two of his companies (Neuralink & xAI) are either headquartered in Texas or have a significant Texas footprint. In all, his companies now own ~$2.5B worth of property across the state. This includes facilities used by Tesla, SpaceX, The Boring Company, and X (formerly Twitter). Some key properties include Tesla’s Austin Gigafactory, spanning 2,500 acres, SpaceX's Starbase in Boca Chica, and the multiple projects The Boring Company has around Austin and Bastrop which adds about 281 acres between the latter two.

Additionally, Musk acquired ~6,500 acres around Bastrop to build a living community for his employees called Snailbrook. The Boring Company has already built Hyperloop Plaza, a community space in Bastrop that includes a bodega, coffee shop, salon, pickleball courts, and a bar coming soon.

Texas Stock Exchange Announced

In June 2024, TXSE Group Inc. announced the creation of the Texas Stock Exchange (TXSE), based in Dallas, Texas. This new national exchange is set to compete with established giants like the New York Stock Exchange and Nasdaq, offering an alternative for companies looking to access equity capital markets. Backed by significant financial powerhouses such as BlackRock and Citadel Securities, the TXSE has raised $120 million in initial funding and aims to be fully operational by 2025.

TXSE aims to differentiate itself by being more CEO-friendly, appealing to corporations frustrated by the growing regulatory burden on other major exchanges. Very Texas. The exchange will be fully electronic and will trade public companies, ETPs, ADRs. The launch reflects Texas’ growth as a business hub, with the state now home to more Fortune 500 companies than any other U.S. state!

Tech

Quick AI News

• OpenAI ironically takes steps to become for profit company with a potential $10 billion payday for Sam Altman, while their CTO & Chief Research Officer quit

• Cursor, an AI-enabled IDE, is the best AI tool for coders that you can use with your favorite LLM, turning you into a 10X engineer. People have been putting out tutorials of how to use it, like this one.

• RunwayML makes deal with Lionsgate to license its movies for training data in a big win for consumers

• A man in North Carolina has been arrested for using bots to generate millions of streams for thousands of AI-generated songs he created.

• EA Games showcases real-time text-to-video game concept at investor day

Telegram Changes Its Tone On Moderating Private Chats After CEO’s Arrest

Telegram has quietly removed language from its FAQ page saying private chats were protected and that “we do not process any requests related to them.” The change came after its CEO, Pavel Durov, was arrested in Paris by French officials for allegedly allowing “criminal activity to go on undeterred on the messaging app."

Users have always been able to report messages, but French officials will likely not allow Pavel Durov to leave France until they feel like there is a robust process to remove content they deem illegal from the app.

Mark Zuckerberg’s Rebrand & Meta’s Innovation

Mark Zuckerberg has gone through a transformation this summer, putting his past “robot with no personality” image behind him. Now he’s making bold statements, rocking oversized heavyweight tees and chains. At a tech summit this month, Zuckerberg vowed to stop apologizing for Meta’s past controversies focus on things within his control, like innovation. This stance has been received well by investors, and the stock has only gone up since.

Meta is tackling VR, AR, and AI and are very competitive in all three, considering the competition. Meta has the most compelling VR product. Now it seems like they have the most compelling AR product in Orion.

Mark Zuckerberg effectively killed Snapchat when Instagram introduced Reels. Since their IPO, and subsequent buyout offer from Meta, Snapchat has struggled to maintain growth or momentum regarding users, revenue, and innovation.

And now they two companies are going head to head again, with augmented reality. Meta’s glasses look like normal glasses while Snapchat’s look more like IMAX 3D glasses. You can compare the other options as well. Microsoft HoloLens and Magic Leap products are both ugly have completely lost steam. Meta has no competition.

And with AI, they have the most democratic product. Open sourcing Meta’s LLM Llama is something you’d expect a non-profit called OpenAI to do, but he’s the only one releasing new open source models.

Sports

How Nike & The WNBA Are Downplaying The Caitlin Clark Effect

Caitlin Clark, who has reportedly been named WNBA rookie of the year, has been a transformational figure for the WNBA. Her presence on the court has led to record-breaking viewership, with the Indiana Fever becoming the most watched team in the league, averaging a whopping 1.19 million viewers per game compared to the league’s average of 394,000. That’s a 300% increase. This massive following has even translated to increased betting on the WNBA​. “Consistent interest in Clark props and Fever moneylines, and a significant number of bets on the Fever outright make Clark’s influence on the league undeniable,” BetMGM sports trader Hannah Luther said. Clark’s prop bets attracted more handle than any WNBA prop bets ever on Caesar’s Sportsbook.

In response, some ex-players and ex-analysts for the WNBA have come out downlplay her dominance, including Sheryl Swoopes, Jemel Hill, and co-owner of the Atlanta Dream Renee Montgomery.

Caitlin Clark signed an eight-year, $28 million endorsement deal with Nike, which includes a signature sneaker, This deal makes her one of the few women in history to receive a signature shoe. However, we haven’t seen any promotion of her by Nike as a pro. And the shoe might not come out until 2026, which limits Nike’s ability to capitalize on Clark’s arrival to the WNBA. Nike may be trying to avoid controversy by waiting until after Aj’a Wilson’s signature shoe drops, which is slated for 2025.

Was Tom Brady Right About NFL Rookie QBs Being Thrust Too Early Into The Fire?

The Carolina Panthers recent benching of sophomore Bryce Young, the No. 1 pick in the 2023 NFL Draft, after a challenging start to his NFL career, has reignited the debate about whether rookie quarterbacks are being thrown into starting roles too quickly.

During a live recording of The Stephen A. Smith Show earlier this year, Brady reflected on his development trajectory as a quarterback. He emphasizes that for five years in college he got to learn gradually in a pro-style system, where he worked his way up from being the seventh quarterback on the depth chart to eventually starting. Then, in the NFL, he continued to develop for his rookie season, and didn’t start until game 3 of his sophomore season when Drew Bledsoe was injured.

The greatest quarterback of all time didn’t start a single game his rookie season. We shouldn’t expect more from anyone. This philosophy makes Arch Manning’s position at Texas make a lot more sense, but we’re still happy to see Arch get some good play time.

Big Ten, SEC to talk possible scheduling partnership

ESPN sources announced the SEC and Big Ten are meeting this week to discuss scheduling conversations. Creating similarities and somewhat equal competition between the two conferences is the goal of the Big Ten and SEC. As the two major conferences driving the conversation about CFP reform, the future of FBS continues to look like a two conference layout. What does this mean for the rest of the teams in the FBS?

Most in the conversation agree change is needed.

• Playoff expansion and more structure

• Automatic Bids from power conferences

• Bowl game relevancy and criticism

• Need to reform

• Who is driving change?

Read this article for a more holistic idea of what the future of FBS should look like.

Deion Sanders & The Colorado Buffaloes Bounce Back from A Lackluster 1st Season

Deion Sanders and the Colorado Buffaloes have shown significant improvement in the 2024 season, since their underwhelming 2023 campaign. After finishing 4-8 last year, they currently stand at 4-1, riding a three-game winning streak, including a dominant 48-21 victory over Central Florida. Travis Hunter has been a key factor, excelling on both sides of the ball and drawing Heisman attention for his performances. With the team now entering Big 12 play, Coach Prime has them on track for postseason contention, already matching last year’s win total.

Music

Quick Music News

• TikTok to Shutter Music Subscription Service TikTok Music in November

• Spotify Beats Eminem Publisher’s Lawsuit Over Billions of Rapper’s Streams

• Spotify Rolls Out Beta for Text-toPlaylist Feature

• U.K. Government Steps in as Ticketmaster’s ‘Dynamic Pricing’ Fiasco triggers Public Outrage Over Surging Oasis Ticket Prices

You may be familiar with the term “network state,” but there's less discussion about its lesser-known sibling: the microeconomy. Microeconomies aren't a novel concept; people have been engaging in peer-to-peer transactions since the beginning of time. However, not much comes up when you search the term. The internet has supercharged these economies, exemplified by online gaming worlds like Runescape, World of Warcraft, and the burgeoning creator economy. With new technologies, these microeconomies are becoming easier to create and offer fresh avenues for generating value.

In today's economy, the ability to turn nothing into something is more crucial than ever, with inflation running rampant. This conversation needs to be had now, as the benefits of being an early adopter are ripe, and the potential scale of these microeconomies is virtually unlimited. Their total addressable market is uncapped, presenting unprecedented opportunities.

Currency & Pre-internet

Before the internet, nobody could have imagined that being a blogger, streamer, YouTuber, or professional gamer could be viable careers. Yet, here we are in a thriving creator economy. In a recent podcast episode, Balaji Srinivasan, author of “The Network State” and host of The Network State podcast, highlighted the inherent value of micro-economies, using the Japanese Yen as an analogy:

We get to choose what we value.

The Internet & The Creator Economy

The internet era has unlocked novel ways to create value, transforming the very nature of value creation. We're moving away from traditional trickle-down economics to more experimental, bottom-up, and middle-out approaches. Microeconomies, in this sense, are the evolution of the creator economy – a new paradigm of value creation.

Unlocking New Ways to Create Value

Virtual in-game marketplaces, internet platforms sharing ad revenue, and the broader creator economy are all examples of microeconomies. They extend the economy's market cap by introducing innovative ways to earn income. These microeconomies embody inclusiveness, offering more opportunities for people to support themselves, aligning with the ethos of web3 technologies like cryptocurrencies, DAOs, and NFTs. When we begin to value all our physical and digital possessions and create liquid markets around them, we break ourselves out of the “I can only buy this with X dollars” mentality as if we had a digital pawn shop everywhere we go. 

Trickle-Down Economics to a Bottom-Up Approach

The Medici family's investment in the arts during the Renaissance demonstrates how supporting creativity can lead to significant societal impacts. Microeconomies represent an alternative to traditional models, offering new participants the chance to join emerging communities and contribute to their growth. You can invest in startup cities that may flourish in a few decades and startup currencies, several of which have grown to tens or hundreds of billions of dollars in market cap. You can also invest in budding artists early in their career and ride the waves as they gain notoriety.

Examples of Successful Microeconomies

From game skins in CS:GO and Fortnite to the nostalgic surge in Pokémon card values, we see diverse manifestations of microeconomies. Time and time again, we’ve seen nascent microeconomies bud from an existing industry, creating new ways to monetize people’s interests. Each of these microeconomies innovated on top of an already established industry. Game skins are a $50 billion plus industry. Fantasy sports is a $10 billion industry in the US. The creator economy is worth $100 billion plus.

Bitcoin's market cap is also a testament to the power of community-driven value. Microeconomies can even manifest in physical form. At pop-up events like Cooltopia at NFT NYC and DoodlePutt at Art Basel Miami, patrons run around and play games to generate tokens that can be redeemed for food, clothing, and accessories (let’s call these Proof-of-Fun experiences). These events demonstrate how alternative forms of currency can facilitate unique experiences that emphasize community buy-in and participation.

Escape Valve + Join Your Cohort

One feature of microeconomies is that there are always new ones being created. Too much scale leads to corruption, and microeconomies create an escape valve for people who can’t exist in the current economy. Many of us take access to basic financial services for granted. In many countries, there are residents who do not have access to a bank account or other financial services, resulting from geography, lack of identification, or religious rules. Crypto offers an escape valve, allowing them to control their own money. Another benefit of new microeconomies popping up consistently is the ability to join your cohort. When a new microeconomy is created, the playing field is reset, allowing new users to participate without the pressure of existing participants who have been accumulating much longer. 

In Conclusion: A Vision for the Future

Microeconomies offer a glimpse into a future where value creation is decentralized, inclusive, and driven by community participation. They present an opportunity to redefine our understanding of work, value, and economic participation. As we navigate a world marked by economic uncertainty and technological evolution, embracing the concept of microeconomies could be crucial in building a more equitable and dynamic future.

Like I said in a recent podcast episode, too much scale breeds corruption.