Editor’s note: This post originally appeared in our newsletter — for more trend updates, builder guides, industry reports, and other resources from a16z crypto, subscribe here or below.
IN THIS EDITION:
- Everybody’s talking about prediction markets (and us too, again)
- Advice for founders fundraising: Stop trying to get preempted!
- When hiring for crypto, or doing marketing in crypto: When do — and don’t — you need crypto-native experience?
- From city blocks to blockchains: The latest on congestion pricing, carpooling, and commuter welfare
- Industry news and updates: a universal standard for AI-driven payments and agentic commerce; yet another stablecoin, credit card, more; and… “Was this thing built by people I trust?”
ZEITGEIST
Everybody’s talking about prediction markets — here’s what you need to know
Scott Kominers, Alex Tabarrok, and Sonal Chokshi
Prediction markets are a hot topic again — even cartoon characters are talking about them (thanks, South Park?). But beyond the buzz, what is a prediction market, exactly? How do they work, how are they designed, and what makes them work?
We tease apart the signal vs. the noise in this deep-dive episode featuring experts Alex Taborrok (professor of economics at George Mason University) and Scott Kominers (a16z crypto research partner and Harvard Business School professor), in conversation with Sonal Chokshi. While we originally covered this topic during last year’s election, the discussion is more relevant than ever today, as we go into the claims people make about prediction markets — what they’re good for (and not); how they fit in with other trends like AI, futarchy, and the crisis in scientific publishing; and where blockchains/ crypto comes in.
This is your definitive explainer on the topic; listen (or read it) here.
COMPANY BUILDING
Advice for founders: Stop trying to get preempted
Arianna Simpson
The “not-raising-raise” playbook for fundraising became very popular a few years ago. That time (2020-2021) represented a very different market and environment: The IPO market was hot, stocks were ripping, and interest rates were near zero; it was hard to distinguish strong fundamentals from ZIRP phenomena.
But a lot of startup founders are still opportunistically taking VC meetings today, hoping to be preempted in their fundraising round, even if they aren’t officially raising (they’re “heads down building”). The problem is this strategy doesn’t work out for most of those founders. The best way to know you’re being preempted? There’s a term sheet in your inbox. Short of that, you’re really being asked to run a fundraising process with a single bidder.
The founders who are seeing the most success in fundraising today are the ones who have rediscovered the lost (pre-2020) art of traditional venture capital pitching: A structured, intentional process. read more
On hiring: When and when isn’t blockchain experience essential?
Ian Dutra and Craig Naylor
As the crypto industry grows, and creates a greater demand for talent, one of the biggest questions that comes up is — whether you need to hire someone who has crypto-native experience, or hire someone who can learn the industry?
It’s the source of endless internal debates. But there are well-established practices you can draw on to find the right people with the right skillsets. That’s what this guide is for: to help founders and recruiters determine where crypto experience is crucial; where other kinds of experience can have the biggest impact; and what challenges and considerations need to be addressed along the way. read more
On marketing: Differences in crypto vs. more general tech marketing
Claire Kart, Amanda Tyler, and Kim Milosevich
watch/ listen for more
INDUSTRY NEWS AND UPDATES
Research: The latest on congestion pricing, carpooling, and commuter welfare
Everyone hates traffic. So where and how does congestion pricing — which extends from city blocks to, yes, blockchains — come in? We covered this topic on our podcast earlier this year with Michael Ostrovsky of Stanford University’s Graduate School of Business and the National Bureau of Economic Research. Now, Ostrovsky, with Michael Schwarz (of Microsoft) share in a just-released paper their latest findings that carpooling and road pricing can be “much more effective jointly than each one separately”, and without having to rely on redistributing government revenue.
To learn more about congestion pricing — the economics, the theory, the reality — check out our episode with Ostovsky, as well as a16z crypto’s Scott Kominers and Robert Hackett, here.
Industry news
Morgan Stanley will offer cryptocurrency trading on its E*Trade platform through a partnership with Zerohash in 2026, according to Reuters. E*Trade clients will initially be able to trade bitcoin, ether, and solana.
Fold announced earlier this week that it is launching a bitcoin rewards credit card by integrating with Visa’s global payments network and Stripe’s issuing infrastructure. Unlike other reward programs, as reported in Yahoo Finance, Fold’s system will “be entirely Bitcoin-based, without token lock-ins, staking requirements, or complex redemption processes”.
Coinbase and CloudFlare announced they’re creating a foundation to support x402 protocol adoption. By embedding payments directly into the web using the HTTP 402 “payment required” protocol code, x402 is intended to be a “universal standard for AI-driven payments”, according to Coinbase, ushering in “a new era of automated, scalable commerce”.
x402 allows clients and services on the web — from AI agents, APIs, and apps — to directly exchange data on the web. CloudFlare outlines how the transaction flow works step-by-step in this post, but the key point is that specific clients and servers are able to transact without the need for accounts, subscriptions, or API keys. In other words: “transact value, not just exchange information”. Early use cases outlined by Coinbase include pay-per-use, pay-as-you-go, and pay-per-content for AI, real-time analytics, storage and compute, tipping for content, and of course… agentic commerce.
CloudFlare also introduced a new dollar-backed stablecoin to enable “instant, secure” transactions for the agentic web.
For resources from a16z crypto on the rise of AI agents, agentic commerce, and where crypto comes in, go here.
Around the web
On the importance of full-stack openness and verifiability, by Vitalik Buterin — excerpts below:
Perhaps the biggest trend of this century so far can be summarized by the phrase ‘the internet has become real life’…
The civilizations that gained the most from new waves of technology are not the ones who consumed the technology, but the ones who produced it… This future involves a lot of trust being put in technology. If that trust is broken — through backdoors, security failures — we get really big problems. Even the mere possibility of that trust being broken forces a fallback to fundamentally exclusionary social models of trust (‘Was this thing built by people I trust?’).
Avoiding these problems requires technology across the software, hardware, and bio stack that has two intertwined properties:
- Genuine openness — open source, including free licensing; and
- Verifiability — including, ideally, directly by end users.”
read more
to compile is human, intents divine
— a16z crypto editorial team
You’re receiving this newsletter because you signed up for it on our websites, at an event, or elsewhere (you can opt out any time using the ‘unsubscribe’ link below). This newsletter is provided for informational purposes only, and should NOT be relied upon as legal, business, investment, or tax advice. This newsletter may link to other websites or other information obtained from third-party sources — a16z has not independently verified nor makes any representations about the current or enduring accuracy of such information. Furthermore, the content is not directed at nor intended for use by any investors or prospective investors in any a16z funds. Please see a16z.com/disclosures for additional important details, including link to list of investments.
