A Conversation on Web3: Addressing Global Problems
A conversation with Andrew Rosener about Web3, how to enable mass adoption, and how it might address global problems.
In this series of short interviews, we ask the Future Works Council to share their hopes, fears, and predictions about the future.
1. What is Web3, in your view?
In my view, Web3 is a natural evolution of the consumer Internet. The evolutionary change from Web2 to Web3 is defined by native identity, native currency, or money. There’s a proprietary element to this that incorporates both of the things I just mentioned. I think those are the fundamental first principles of Web3.
Then, with that comes this proprietary layer, which is “I own my data” and “I own the value,” “I benefit from my use of Web3,” — meaning “I’m getting paid for my attention,” “I’m getting paid as a consumer,” “I’m getting paid to be part of a community.”
And when I say “getting paid”, I don’t mean necessarily (but could be inclusive of) monetary remuneration. It’s also other forms of value that will mainly take the shape of a token.
To give an easy example: If I go to Facebook today, I log in with a username and a password. I have a lot of user data that Facebook captures. And then, Facebook’s business model is to provide me with this platform for free and utilize the data capture in order to provide advertisers with a platform to target me.
I think Web3 is really just a response to that business model whereby it’s going to provide this proprietary layer to the user: data and identity. Then it removes the friction that exists in Web2 by creating a new native currency (whichever cryptocurrency you want to discuss — there’s a lot of experimentation happening). I fundamentally believe Bitcoin will continue to be the base layer money of Web3 — or society in general if we could look forward far enough.
There’s a lot of experimentation being done around various ways to achieve different objectives regarding the growth of Web3.
Here’s one example: let’s imagine you have a friend whose article just got published by The Economist or The New York Times, and you want to read it. Now, here’s where the problem starts. You don’t have a subscription to those magazines, so you have to go through this painful process of setting up an account, and then an even more painful process of paying to use the website. And it’s not even that you necessarily mind paying for your consumption. It’s the friction to do so. It’s also an unnecessary commitment: you wanted to read one article, and you’ve now subscribed for a year or a month, or indefinitely, and if you want to change that, you have to go through the whole process again to cancel your subscription. It’s just a time suck and a substantial piece of friction.
Now, let’s imagine the same situation but in Web3. You learn about the article and go on, simply navigating the web with your Web3-enabled wallet that contains Web3-enabled money in some form of cryptocurrency. This way, you have this potential tollbooth mechanism where a friend sends you an article, and you just read it. Now, let’s say you spend more than a certain amount of time on that page. That would mean you’re really consuming the content, so they charge you two or five cents (or wherever the price is going to be). That’s it!
What’s great about it is not only that you pay only for what you consume, but also, presumably, that mechanism brings back competition for high-quality content: the higher the quality of the content, the more they can charge you for the total of consuming that content.
It goes even further — thanks to such mechanisms, where we no longer have clickbait and disinformation. Now we have people competing to produce the highest quality content in order to get my attention because my attention provides value to them; instead of providing clickbait to me to stay on the page and work with the advertisers to pay them which is the case now.
2. Why is it so important right now?
One of the biggest pandemics that we have, is not one of health, although it is causing massive problems with mental health; it is a problem of misinformation.
And I think that Web3 will be the best tool in our toolbox to help address this issue.
3. How does it help us reach humanity’s pressing goals?
That’s a comprehensive question. A lot of us have different goals and priorities all over the world. I think that’s why the world is so polarized at the moment, unfortunately.
There are two exciting innovations that have come into the spotlight this year, even if they still have been in development in the more nascent parts of the crypto world. These are (1) decentralized autonomous organizations and (2) the concept of the non-fungible token (NFT) which, in essence, is an identity mechanism.
My background is in domain names. For 24 years, I’ve been investing in and working with understanding the identity layer of the internet, which includes domain names. That leads me to the thought that NFTs are sort of an evolved version of a domain name, whereby, instead of identifying a destination address, you’re specifying an asset. That asset can be anything: music, art of any form, a video, etc. — that’s what most people understand as NFTs. Yet, it could identify anything, any type of asset, digital or physical. I think that with some emerging technologies, NFTs will also begin to identify physical assets. It will be the mechanism by which we tokenize value.
I think that NFTs will allow us to achieve some of the massive, societal goals collectively. They enable us to organize resources in the form of human resources and capital resources very quickly and in a way that is unobstructed by the regular constraints in the real world. Then we could point those resources at a singular objective, problem, goal, or asset to be acquired.
4. What areas of Web3 aren’t being worked on enough?
One of the big mantras of the people who are deeply working in the Web3 environments that I subscribed to is, “How do we get to a billion users.” That may be an arbitrary number, but it’s probably a good goal if we’re trying to reach a tipping point.
The issue with this is that I don’t necessarily believe that many of the things being done within Web3 will lead to that outcome.
NFTs are probably the greatest Trojan horse we’ve ever seen for onboarding previously unaccustomed users into this environment. Art, in general, speaks to people emotionally, and most people are going to respond to an emotional call to action, more so than a financial call to action.
The reality of Web3 is much to the chagrin of the people working in crypto and referees. However, for a regular person, the truth is different. They don’t think about money in the way crypto users do. Most people go to work to get their paycheck. Most of that paycheck is spent buying food, paying the rent, and getting the necessities needed daily. The vast majority of the world comes up short on the necessities they need in their life. Thus, money for them is just the means for their needs. It’s not something you’re planning for. The majority of people don’t have the luxury of thinking about saving or investing. And so cryptocurrency is a really important concept but not intriguing or enticing to the vast majority of the people on this planet.
While NFTs might speak to people emotionally, it still requires that you have disposable income to go out and spend on a digital monkey or a pixelated punk.
So, we need as much diversity in this problem-solving process as possible, in order to find the optimum solutions for the whole of humanity. Coming back to the initial thought — I think that in order to get to a billion people, what we need to be working on isn’t the next Ethereum killer necessarily, but the best way to allow people to be their own custodians of their own assets in a safe manner, whereby they don’t lose their life savings by forgetting a 24-word seed phrase or losing the private key.
We need to improve the way Wallets work from the UX side. I see it as the biggest problem currently, that needs to be solved to get to a billion users.
5. Mainstream adoption seems to elude many Web3 projects. What will change that? What are the barriers in your view? How can they be overcome?
I guess this is the chicken in the egg problem or the catch-22 problem.
Once Web3 gets enough users, we will get a real group of testers with their unique preferences, and it’d be easier to deploy new applications because you’ll have this massive market to address, and thus plenty of capital to work with.
Again, I’d say that before we start innovating, we really need to fix the basics — the Wallet user interface. In my experience using Web3 is 5000 times easier than using Web2. I don’t need to remember all my passwords for all the different sites. I just navigate through the platforms seamlessly. I click one button that connects my wallet to a certain website. That’s basically my sign-in. However, with that action comes my wallet with the assets that I might be able to utilize on that website. It automatically provides my identity verification as well. Everything is there in a single click. It literally couldn’t be easier.
That leads to a second thing — protection mechanisms. All the value held in the Wallet (from identity, through money or assets, to verification, and status) needs to be very well protected in an easy-to-use, user-friendly manner. So easy that my grandmother can feel comfortable when she’s navigating around Web3.
I think if we can solve these two primary problems, it shouldn’t be tricky to onboard the people and show them the benefits of Web3. Everybody hates having a subscription to all of these different websites to read articles they want to read. Everybody hates forgetting their password and going through the rigmarole of password reset. Everybody hates having Facebook utilizing all of their data. Everybody hates that you can’t do a simple Google search without the odd feeling of being monitored and targeted in all those weird ways.
We’re all suffering from the same friction. And we’re all suffering from the same wrong user experience. Still, there’s no good alternative for a regular user, unless you are at that cutting edge, willing to take the leap of faith to get onboard with Web3.
It’s not hard to imagine that 10 years from now everything that we’ve got on Web2 will be on Web3, except way better.
6. Do you think that the right actions are being taken to develop a system that is safe enough to provide the safety measure that you’ve mentioned, or it’s too far-fetched of an idea?
I don’t think it’s far-fetched of an idea. I just think it’s a very big problem that a lot of brilliant people are working on solving. I’m not privy to what is out there right now to solve this problem.
What I’ll say now certainly isn’t going to be a popular view. I’m not even sure that I’m happy with this view. But it is the view that I think is most probabilistic and realistic.
Let’s take 10–20 years from now. And then let’s take our banks today. It’s going to be very difficult for banks to keep profiting (they make money on transactional fees) when we start introducing the central bank (which is most likely going to happen) with digital currencies. Are consumers going to have a direct relationship with the Federal Reserve or the central banks?
Imagine that I have an account. Then they want to give me stimulus or whatever weird forms of monetary policy we’re going to have in the future, so they go ahead and just deposit that into my account.
The other case is more shocking and scary — it could be possible to just withdraw a mandate or incentive from my account when I don’t do something that I’m supposed to do, or my behavior isn’t in line. Or they could potentially put a timestamp on my money and say, if this isn’t spent by X date then it expires or depreciates. There are scary and interesting things that can be done with centralized programmatic money.
Banks are some of the most powerful, largest, and wealthiest organizations on our planet. They hold the world’s assets. I don’t see that going away anytime soon.
So in the world of centralized programmatic money, I think banks will look a lot like their customer service departments, assisting users in their specific cases. I think that we might get back to something like the original role of a JP Morgan, which basically held specific assets and then gives you something that says you have this collateral. It’s probably going to look like some kind of multi-signature, software wallet: you’ve got a little token that says you have a bunch of collateral; that collateral is not in your wallet, it’s at JP Morgan or whatever bank. It’s held in reserve. You’ve got a token that says you own the collateral and it’s somehow updated in real-time. It allows you to go out and navigate, with a second layer settlement tool, whereby there’s some tool that will settle with JP Morgan, like how credit cards work today. So in my opinion, what happens is that said banks go back to being the asset custodian that holds all of the collateral. And Web3 is the economy layer on top of that.
Thank you for reading!
Interviewer: Justyna Cyrankiewicz, Creative Content Curator and Writer. Editor: Joe Foxton, Head of New Business.
With love, Future Works💛
