Introduction to Web3 — III: Where Do We See Emerging New Projects?
In this last part of our mini-series on Web3, we are looking at potential areas that will emerge with this new technology.
So where do we see Web 3 projects prevail? Let’s have a quick look at five key areas:
Gaming and social networks: It was users who contributed to the success of all the Facebooks or gaming studios of Web 2.0, however it was the corporations that captured all of the value created. Users were told to get ‘free’ service and be happy with it. Users later learned that these services were not actually free and user data were used without their consent (they got consent but who reads the fine print anyway?) and actually be manipulated. With new Web 3 technologies, we will see how users get their identity and belongings back. Make no mistake: There will be a heavy fight with incumbents such as Facebook and decentralized organizations — jury is still out on this one. We will elaborate more on this issue in our following posts.
NFT’s: No, it is not ‘just jpegs’, the non-fungible-tokens will be the predominant value capturing mechanism in the new digital world. Finally, we users will be able to preserve and fully own our assets in digital life, just like our physical belongings in our ‘real’ or physical life. Imagine the economic potential that would born out of this innovation — if you have trouble imagining it please follow us for following posts. In short, digital ownership will be the name of the game over the next decade. Fractional ownership, transfer of digital rights, ability to program tokens to get percentage revenue from further sales.. So on and so forth. All coming.
DAOs (decentralized autonomous organizations): Joint-stock company where value is captured by capital holders and entrepreneurs has been under attack for quite some time with the introduction of the ‘network’ concept. Now DAOs take this concept one step further. No need for ‘legal’ formalities. DAOs can be founded in a very short amount of time and are able attract thousands of people. What these people offer is their cash as well as their time and effort. Will such organizations be successful? Only time will tell but we have seen thousands of DAOs were being formed in 2021 and that trend will likely continue going forward. Here is a bold prediction: A DAO with more than 100,000 members will be among the top ten most valuable entities in the world by 2030!
Cryptocurrencies: Fiat currencies by nature are issued by centralized bodies. Just like companies. While DAOs are posing a threat to joint-stock entities, cryptocurrencies give a similar challenge to fiat currencies. Why? Decentralization is the name of the game in this new world. Cryptocurrencies are by nature decentralized so the underlying philosophy quite fits to Web3’s. Any DAO or network may issue its own token and form its own ecosystem. Will that trend continue? We will see.
Decentralized finance: When you look at NFTs, cryptocurrencies, DAOs, social networks, you see small ecosystems popping all around the digital space. When they start walking on their own, they will also need to interact with each other, be it be value transfer or helping out the growth of others. Decentralized finance is poised to be the finance provider for projects that need help to grow, incentivize their participants or simply use their own treasuries.
We will be talking about each of these areas, how Web 3 will be able to change them and how they interact with each other in our following posts. The first topic will be NFTs.