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Understanding play-to-earn, my most impactful mental model

Understanding play-to-earn, my most impactful mental model
By Tom Littler • Issue #59 • View online
It’s been a while, I’ve been focused on building out Lithium, sometimes in life priorities change… but I’m going to get the ball-rolling with these updates again!
Welcome to all the newcomers, we’re now 7115 strong!

👾 Play-to-earn, shorthand for the ability to earn good money through playing crypto-backed video games will, in my eyes, be one of the biggest trends of 2022. Most people are aware of play to-earn, but few understand the economics behind it, in this article I share how play-to-earn actually works, hopefully explained in a way that the Leyman can understand.
How to View Limitations
There are ~ a dozen mental models that form the basis for the majority of my decision making.
I’m not smart or original, these are models I’ve adapted from reading/studying exceptional people.
We’ll start with the most foundational - David Deutsch, and how to view limitations
Problem - most people’s point of reference for viewing limitations is to take well-known proxies/lines in the sand of what has been done before.
Let’s look at an example
Human Population Limits
It’s a commonly held belief that there is a limit to how many humans this planet can healthily contain.
Humans are destroying the planet, exploiting its non-renewable resources.
Eventually, nature will take of this, probably through some epidemic.
This worldview is grounded in the reality that we currently live, predicated on the beliefs
- There is a limit to the energy we can produce
- There is a limit to the amount of food we can produce
- There is not enough land for us
Deutsch would argue these beliefs are false
Deutsch’s main philosophical standpoint is that human ingenuity is infinite.
The only limitations we bear are the fundamental laws of physics.
If a problem can be solved in the boundaries of physics, it can be solved by us.
But first, why is our ingenuity infinite?
Before diving into infinite ingenuity, let’s get a handle on memes.
Just as a gene is a genetically encoded behaviour, a meme is culturally encoded behaviour.
Not going to a bar in your pj’s in a meme
Explaining that leaves fall due to gravity is a meme
All animals have memes - but ones created through trial and error.
The difference with humans is we can create memes through thought experiments.
Einstein didn’t arrive at the theory of relativity through trial and error, he conjectured it, then tested it.
This idea, that we can create memes through thought experiments and what Deutsch terms ‘good explanations’ is critical.
It enables every generation to build on top of the last, adding to the overall memes of human knowledge. Each generation gets more knowledgeable.
This is why human ingenuity is infinite. So long as we have more creative human thought, we have more progress, leading us closer to the fundamental laws of physics.
Using this lens, let’s review the statement
‘there is a limit to how many humans this planet can healthily contain’
First energy - the idea that we can create infinite energy has long been considered absurd. Indeed the great Da'vinci quickly came to the realisation that the perpetual motion machine was a waste of time.
But infinite energy is possible - it’s called nuclear fusion
Fission - the process used in power plants to break heavy elements into lighter ones.
Fusion - the opposite, light elements are converted into heavier elements, releasing much more energy than required to initiate it
Fusion is not science fiction, it happens every second, on our Sun
To generate infinite energy then, all we must do is recreate the suns conditions on planet earth.
An easy task, no? But impossible - definitely not.
Many (myself included) believe we will have cracked nuclear fusion in the next 50 years.
The next problem - food.
From a physics point of view, creating food is just alchemy. It’s the turning of one material into another using energy.
Growing rice is just turning h20, photons and some minerals into starch.
A combination of nuclear fusion and fission could create any material we want from any other material.
Alchemy may sound like science fiction, but again, it happens in our universe every day, we just haven’t mastered it on earth.
The final problem - land
Ok but what about land, surely there’s no way of getting around the fact there is only a certain amount of land on planet earth? We can’t just manufacture land out of thin air!
While it’s true there’s finite land, in the 2d, there isn’t in the 3d. We could build vertically, unlimited.
Through VR we could also drastically reduce our need for ‘the real word’
This obviously sounds like a dystopian future, and maybe it is, but it’s possible.
Ok, so maybe you can now see a future in which we don’t need to control population growth? But so what, this is purely philosophical, how does this help in day to day decision making.
I’ve found, that once your thought process form
‘what is possible in my frame of reference’ to
‘what are the limitations in the laws of physics’ magic things start to happen.
Every problem starts to look solvable, and you’ll find it is.
Issues with your tech product are just opportunities to get ingenious with your code.
Issues with product:market fit are just an opportunity to iterate quicker
Issues with team members are just problems of lack of understanding
It may sound trite, but if you deeply believe, to your bones, in infinite ingenuity you also become 10x more optimistic.
Of course, you see the problems in the world, but rather than adopting nihilism, you trust there is a solution humans will invent.
Overall I’d say infinite human ingenuity is my most foundational model.
Changing my frame of reference to ‘what do the laws of physics dictate are the limitations of this problem’ has had an impact on nearly every aspect of my life.
What I'm Reading
Richard Feynman is up there with one my favourite thinkers. This book, a autobiography of Feynman’s crazy adventures (including being part of the Manhattan Project) give more of an insight into the mind of a genius, than any book I think I’ve ever read.
Tweet of the Week
Paul Graham
I have never read a business plan or a balance sheet.
The more I get into making investment decisions, the more I realise business plans of any description are such bullshit. Ask the founders questions about their area, get to the root of what they know, understand how they think about their space, etc. etc.
If you got some use out of today’s issue, spread the word by sharing this link with a mate! Keep the subs rolling…
Cheers,
Tom
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Tom Littler

Tech, life, entrepeneurship

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