Variant Founder: Everything is a Market, the Endgame of Finance is "Invisible"

Author: Jesse Walden, Founder of Variant

Translation: Yuliya, PANews

Editor’s Note: Jesse Walden, founder of Variant Fund, presents a forward-looking view that “everything is a market,” believing that cryptocurrencies are expanding financial boundaries into the cultural realm, becoming a horizontal layer of infrastructure. Starting from three core drivers—mass participation, permissionless innovation, and market programmability—the article explores how finance is evolving into a ubiquitous infrastructure and depicts a future where financial invisibility is achieved through the integration of cryptography and artificial intelligence.

The full text is as follows:

The debate over whether cryptocurrencies are purely for finance or have a grander purpose has persisted for some time. My view is: yes, cryptocurrencies are for finance. But the key is that the scope of finance is becoming much broader than most people realize.

There are three fundamental drivers behind this shift:

Mass Participation: As market access barriers lower, finance is increasingly intertwined with culture and heavily influenced by it.

Permissionless Markets: This driver acts as a catalyst for change, allowing users worldwide to demonstrate new behaviors and, in the process, pushing regulators and traditional institutions forward.

Programmable Endpoints: Financial markets are transforming from discrete venues into APIs. They embed economic data, generate real-time information that is costly to forge and that other systems cannot produce, and are seamlessly accessible to AI agents.

Mass participation changes who is using markets; permissionless innovation changes what markets can exist; and the programmability of new markets opens up new design spaces for us (and AI agents) on how to use markets.

In summary, as the world’s value becomes increasingly software-based, finance is undergoing a radical transformation that requires us to adopt a more expansive view of its ultimate form.

Toward One Billion Traders

In 2020, Variant introduced the vision of the “Ownership Economy,” aiming to make one billion users owners: owning their identities, funds, data, and the products and services they use daily. Today, user ownership has been realized in some key vertical software domains, primarily centered around financial attributes: store-of-value assets (BTC/ETH), decentralized blockchains, and financial markets (Solana, Uniswap, Morpho, Hyperliquid)—we are fortunate to be investors in these projects.

Looking back, the argument from 2020 was correct: people want to gain economic upside from things they understand and care about. I initially thought this would extend like employee options to all products used daily; but in reality, the opportunity has become about “interests”—investing in anything you believe in.

Today, “trading” has become a broader, less physical way for users to participate in economic upside (and downside). Evidence shows that, compared to owning digital identities, money, data, or platforms, the feedback from trading is more direct and expressive.

Trading often serves as a gateway to participating in broader markets. Many talents I’ve encountered in crypto follow a similar trajectory:

Getting burned on a volatile altcoin;

Learning risk management like a trader;

Eventually becoming a more mature, long-term investor.

Even failed experiences are meaningful: a gambler who loses everything but decides to only bet on what they understand becomes a trader; a trader who develops conviction and extends their time horizon becomes an investor.

We can view this continuum of risk-taking through Maslow’s hierarchy of needs:

Gambling and trading satisfy lower-level needs: security (escaping economic hardship through big wins) or belonging (like WallStreetBets trying to fight Citadel, or you betting with friends on a team).

Investment aligns more with higher-level self-actualization and purpose. Owning a home is the American Dream; investing in a company is expressing belief in its future. But if your focus remains on lower needs, it’s hard to develop that belief.

PANews note: WallStreetBets (WSB) is a well-known subreddit on Reddit, famous for high-risk, aggressive investing and meme stock trading. It’s known for encouraging leverage options trading and seeking short-term gains, and gained global attention in 2021 for orchestrating the GameStop (GME) short squeeze. Citadel is a top hedge fund and financial services firm, renowned for rigorous risk control and high returns, and is one of Wall Street’s most influential giants.

Because of their short-term nature and volatility, trading satisfies more urgent needs for many. Moreover, permissionless markets can target virtually anything—from derivatives to memes to political outcomes—making channels for economic gains broader than ever.

In many such markets, life experience can (at least temporarily) become an advantage. A kid who understands TikTok trends may know memes better than Citadel; a player immersed in virtual economies may understand games better than analysts.

The old adage “invest in what you know” is becoming increasingly feasible today. As a result, market participation is no longer just a profession but a cultural phenomenon with its own status games, memes, heroes, villains, subcultures, and language. This newfound expressiveness and accessibility are increasingly intertwining finance with culture. From fashion trends to political events, markets are becoming a medium of cultural expression.

(Figure: Balenciaga S2023 fashion show at the New York Stock Exchange)

We are witnessing exponential expansion of global economic access via stablecoins; meanwhile, financial risk-taking through trading and markets is also growing, heading toward a scale of one billion active traders.

Markets as Drivers of Change

In the 1960s, the average holding period for stocks exceeded 8 years. By 2020, this average had fallen to less than a year. This is the world we live in today: a market with broad participation, where trading has become the main artery for people seeking economic gains.

This world is not entirely within the boundaries of traditional finance. New markets are primarily built externally—often intentionally and out of necessity. Leveraging new technology and free markets to push regulators and institutions is one of the most reliable ways for traditional systems to adapt and evolve.

As I wrote in my initial paper:

“The history of protocol adoption follows a pattern: early adopters use new protocols to do things that were impossible before the technology enabled them. These new behaviors often involve breaking rules. The founding strategy is to build products that make these new patterns accessible to a broader audience.”

A classic example is BitTorrent, invented in 2003. It enabled streaming media, and at its peak, pirated content via the protocol accounted for one-third of internet traffic. Later, Spotify turned streaming into a compliant product (initially also using BitTorrent technology at the core).

Cryptocurrencies are reshaping information in a similar way to BitTorrent—redefining value in a permissionless manner.

Prediction markets: Polymarket has operated on offshore crypto rails for years, when prediction markets were banned in the US. Now, thanks to clearer regulation, they have mobile apps in the US (though not on-chain).

Stablecoins: Also once in regulatory gray areas, initially guiding liquidity on offshore exchanges. Last year, the GENIUS Act brought them into the internal system.

ICOs and fundraising: In 2017, ICOs enabled permissionless crowdfunding when early venture capital was limited. Hostile SEC crackdowns followed, but this intensified a problem: technological innovation and growth returns were privately captured, leaving fewer opportunities for public participation to benefit. This year, Congress is drafting legislation in the CLARITY Act to explicitly allow founders to raise funds broadly through public token sales and share ownership.

Permissionless markets continually attempt to “break rules” to enable people to gain economic benefits from private companies (don’t you want a piece of Claude or ChatGPT?). Recently, Robinhood has tried to introduce tokenized exposure to private companies like OpenAI and SpaceX in Europe, and applied to the SEC to bring private market funds to US retail investors. Startups are experimenting with innovative products offering synthetic exposure to private companies.

This could be a return to the original “ownership economy” thesis—that users can indeed gain economic exposure to the products and services they use daily. But as seen in other markets, regulatory change takes time and often depends on scale and proven market demand.

More directly, I expect many entirely new net-growth markets to emerge, raising a question: what is the full design space of these new markets? How do they differ from previous markets? And who or what will be trading and consuming them?

Markets as APIs

What sets this moment apart from previous waves of financial innovation is the simultaneous expansion of two forms of software expression:

Cryptocurrency: Providing the most powerful rails for new markets—permissionless creation, programmable settlement, composable liquidity, and global access—costs are rapidly approaching zero. Now, we can tokenize and trade things that previously lacked liquidity, were inaccessible, or didn’t exist at all.

Artificial Intelligence (AI): Making it possible to build, model, and automate things that were previously unmanageable.

Crypto + AI creates a combined design space: every price generated by markets becomes a basis for AI action, and every new thing that AI can model becomes an object for market-based pricing.

Intelligence, in this context, is the ability to predict or make wise decisions. Markets and cryptocurrencies offer the best “prediction” mechanisms we know. AI can leverage these prices to understand and simulate the future, and to make decisions.

This design space is precisely why markets are evolving from “outputs” to “infrastructure.” Over the past decade, cryptocurrencies have built foundational infrastructure enabling a surge of new markets. In the next decade, markets will increasingly become infrastructure themselves—endpoints for applications and agents to consume as inputs.

(Figure: Central Food Wholesale Market in Mexico City)

Traditional APIs return stored data. As APIs, markets generate real-time data through adversarial competition among participants willing to risk capital on their beliefs. This makes markets more expressive than ordinary APIs; they not only provide information but also produce it. Moreover, because the information generated by markets is costly to produce, it is also harder to forge.

On-chain markets are even better than traditional APIs because they are permissionless by default, composable (anyone can call them), global, and use standardized interfaces.

Embedding markets directly into products has already begun in finance—what I call the “DeFi Mullet”: fintech products with familiar front-end experiences built on DeFi backend rails, like Morpho vaults. Coinbase’s lending and earning products offer dynamic interest rates, with users paying or earning by querying on-chain lending markets like Morpho. Users enjoy these features without needing to understand the underlying lending market dynamics.

Beyond financial services, Polymarket’s odds on the Oscars is a recent illustrative example. The API provides real-time prices, which are integrated into entertainment products (this market predicted 26 out of 27 winners correctly).

As we tokenize more value globally and bring new markets on-chain, this pattern will extend beyond fintech packaging or live event odds. For example, Apple’s “Clean Energy Charging” is a mainstream case: when you plug in your phone, Apple uses real-time grid carbon intensity forecasts to schedule charging for maximum energy and cost efficiency. You never see the underlying energy markets, but Apple’s product calls endpoints to fetch market signals as inputs to optimize its operation.

MetaDAO, a prediction market-driven crowdfunding platform, pushes this idea further. When facing governance decisions, it creates two conditional markets: one for the token price if the proposal passes, and one if it fails. The higher of the two determines the outcome: the proposal automatically takes effect or is rejected. The DAO no longer votes but calls markets to make decisions, with participants betting real money on what they believe will be the better future outcome. Here, the underlying markets are not just inputs but the decision mechanism itself.

If you assume all finance and markets are becoming programmable, and AI continues to grow stronger, then holding an expansive view of the financial endgame is both rational and exciting. Price signals, prediction market outcomes, on-chain capital flows—all will become inputs that any application or agent can read, interpret, and act upon. If an agent can profit more from creating or participating in markets than from just reasoning, that becomes rational.

When we include AI agent consumption and market participation, the “one billion active traders” figure may be a gross underestimate of future scale.

The Endgame of Finance

Finance is transitioning from a unique vertical industry to a horizontal foundational layer.

As markets become more expressive and accessible, finance is embedding itself into culture, and culture increasingly expresses itself through finance. Simultaneously, as markets turn into permissionless software, they accelerate their role as change agents, opening new opportunities for users to seek economic upside (and downside) in things they understand and love. Moreover, users will want their AI agents to participate in markets to improve their lives.

As markets become more programmable, finance as an informational infrastructure component is becoming more widespread. The most successful infrastructure tends to be invisible, and finance is on the path to becoming woven into the fabric of everything.

That’s why I hold an extremely expansive view of the ultimate trajectory of “finance.”