Every day, more and more Web2 developers are jumping into Web3, as more and more companies and startups recruit talented individuals into this space.
If you’re coming from a Web2 background, you might have even considered joining Web3 yourself. You’ve heard about the promise of technological innovation and the ability to build the future, but you’ve also heard the criticisms, of which there are many.
You won’t be able to make an informed decision until you get answers to some basic questions, like: what is Web3 in the first place? What does the technology stack look like? Can it be learned quickly? Is there actually interesting innovation happening? Why shouldn’t I just work at Google? What’s the future of Web3?
We’ll be hitting all those points in this article. Let’s start by talking about what Web3 is, and what it’s doing to change the landscape of work, code, and the internet.
What is Web3?
Before we talk about Web3, it’s good to know some quick background on its predecessor, Web2. Paul Graham, the co-founder of Y-Combinator, wrote this about the subject in 2005:
“As you read this, a whole new generation of software is being written to take advantage of Ajax [a programming concept that combines HTML, CSS, and JS, to create web pages that dynamically update]. There hasn’t been such a wave of new applications since microcomputers first appeared. Even Microsoft sees it, but it’s too late for them to do anything more than leak ‘internal’ documents designed to give the impression they’re on top of this new trend.”
Web2 was an industry-wide revolution sparked by developers. The behemoths of the time like Microsoft, which were slow to adapt, soon found themselves scrambling to acquire valuable Web2 talent and later yielding their market share to startups that re-thought how web businesses should be — names like Google, and later Facebook, come to mind.
But where are those Web2 companies now? Their dedication to serving users has turned on its head, and they are now posing what Amnesty International calls: “an unprecedented danger to human rights” with their aggressive surveillance practices.
Web3 is now the logical next step. We’re seeing a new wave of programs called Dapps, driven by the need for privacy, decentralization, and censorship resistance.
Under Web3, apps become decentralized with no single point of failure, thereby becoming censorship-resistant. Decentralized social networks don’t store your personal information in an account on a central server on your behalf. Rather, you own and control your data by signing in through the use of public and private keys.
Web2 birthed a rich new industry for web browsers, content platforms, and web search engines, a market now almost fully captured by the infamous FAANG, which has a combined market cap of approximately $7 trillion USD today.
Web3 is poised for explosive growth. Arguably, it has a much wider reach in terms of potential applications, challenging traditional banking, financial services, and just about every other industry, too. These are the early days, and this is still the ground floor.
In deja-vu fashion, we now see traditional companies in the space like Mastercard, Visa, Goldman Sachs, and Verifone acquiring and partnering up with businesses related to crypto, and one has even begun buying NFTs. This signals that Web2 and traditional financial industries are not only paying attention, but clearly ready to have skin in the Web3 game, because digital assets are gaining legitimacy and power in the wider world.
Crypto is Hiding a Huge Opportunity.
Underneath its origins as “internet money”, crypto is a super-productive industry of tech innovators, revolutionaries, and entrepreneurs.
And just in case you still haven’t gotten the message, FAANG is no longer the same band of scrappy upstarts with the user’s best interests at heart. Here are a few examples:
Ever since they removed the “don’t be evil” motto from their employee handbook, Google’s priority has taken a massive shift from the privacy of their users, to the $150 billion ad market they almost single-handedly occupy. A Forbes piece wrote:
“The fact is that Chrome collects more data than any of the other browsers, yet is the only one that doesn’t appear to collect any data that isn’t linked to user identities […] Chrome hasn’t even attempted to protect its users’ privacy in this way.”
Facebook is no better. After an acquisition spree that snapped up Instagram, Whatsapp, Oculus, Giphy, and close to ninety other companies, it’s hard to imagine them as the young, competitive company they portray themselves to be. The blue giant forces Oculus users to link accounts with their personal data or they suspend them, and meanwhile have started running ads in the VR Metaverse.
Amazon, the folks that popularized “people who bought this also bought x” is also now in the same invasive business of online advertising. At the same time, they’re also developing some pretty scary tech for monitoring employees, and has become a real-life dystopian workplace where pregnant women are afraid to take bathroom breaks.
Let’s compare this with a Web3 company:
Gitcoin is like Upwork for software development in Web3. Launched in 2017, Gitcoin provides a platform where projects can post jobs and developers can get paid. Some of these bounties are paid for by Gitcoin Grants, which are community-funded initiatives for open-source software that benefit the public. They fund everything from projects that protect user privacy, to blockchain education, to sybil-resistant (human verification) technology.
And how are their results? Pretty convincing. They’ve had over 1 million transactions since inception and enabled the value transfer of over $35 million dollars between projects and developers. Their bounties pay an hourly value of $26-$113, which is comparable to a full time job ($26 hourly, at 40 hours a week = $1040 weekly).
Larger bounties pay more of course, with some going for as much as $520/hr!
And just like many organizations, Gitcoin needs a governing body that makes decisions about key issues, such as deciding the parameters of grant rounds, what projects are eligible as public goods, etc. However, unlike other organizations, Gitcoin is a DAO (Decentralized Autonomous Organization), which means they give the right of decision to its key stakeholders: users. This is the key difference of their decentralization.
By issuing a governance token to anyone who has interacted with or used their platform, they effectively issue voting rights to complete strangers, who are now invested in the long term future of the platform. Many decentralized applications do this for one major benefit, which is to align the interests of the user and the platform together.
The Positive Impact of Blockchain Technology
Not only is Blockchain transforming the way people work and code, but it is also impacting the world by solving problems in ways that have never been thought before.
In one example, blockchain is being explored as a potential solution to the problem of matching organ donors to recipients. For people who need organ donations, the journey to getting a lifesaving organ can be both perilous and fraught with corruption. A renowned medical journal remarks that: “It is well known that a thriving international black market in human kidneys exists and [the participants] in such a market suffer from a variety of abuses, ranging from fraud to outright coercion.”
The major shortfalls of the current system include: lacking transparency, misusing patient/donor information or using fake information, not protecting the privacy of donor/patient information.
You would think that a centralized system is at least easier to maintain, but in fact it is both costly and time consuming: as most of the work is done by hand, with information relayed between multiple doctors, staff, and hospitals. This led to several documented tragedies that were ultimately preventable. A 17-year old girl was given a heart and lung transplant from a donor of the wrong blood type, leading to her death by suffocation. In the words of one medical journal, there were “no standardized and redundant processes were in place for confirming blood type compatibility.”
In another case, three recipients were given organs from a HIV-positive donor, which resulted in the transmission of the disease to all three recipients. The error was only discovered five days after the transplant. The fault was placed on “a transcription error” and “lack of integration between the lab machine, the laboratory information system (LIS), and the donor record”.
Standardization, redundancy, data-integrity checks, and integration of data feeds between multiple components are functions that can definitely be fulfilled by a blockchain-based system. And in fact, multiple research journals and associations have published articles in favor of such a system, including: IEEE, SJSU, IJSER, JMIR.
One article has a side-by-side comparison of a proposed blockchain model of organ distribution against the current system, and also outlines in detail how such a system can be constructed:
figures 1 and 2, from Creating Organ Donation System with Blockchain Technology — Anmol Soni, Dr. S. Ganesh Kumar
In the words of the author, the proposed system would be: “faster, more secure and more scalable” with blockchain technology. And since verification on the blockchain is absolute and by consensus, “[both] the organ receiver and donor can be sure of the authenticity of the other without hesitation”.
No individual or syndicate could tamper with the information without having majority control over the network, and such tampering would be made publicly known.
Blockchain technology can also be used to help fight climate change, improve supply chains, make charitable donations transparent and accountable, build better cities, improve agriculture, and help artists and creatives earn more from their work. There are many potential avenues for blockchain technology to improve human lives and societies.
And having a good working understanding of blockchain as well as working experience, opens many doors and opportunities beyond simply working in DeFi and crypto exchanges.
Benefits of working in Web3/crypto industries.
In some ways, working in Web3 and crypto is not too different from Web2. You have similar divisions of labor within the company, marketing, product, engineering, etc.
The typical day to day of a Web3 worker looks like this (taken from a survey of 422 DAO workers by Gitcoin and Bankless DAO):
Building cool stuff, and being able to work on your own schedule is an attractive proposition for many. And for great multi-taskers, there are no limits to the number of sub-working-groups you can be a part of, which increase your contribution to a project and earning prospects significantly.
Most crypto workers work remotely from around the world, and use email, Slack, Discord, and Telegram to communicate.
In Web3, some organizations have a more traditional hierarchy, while others (“DAOs”) have an egalitarian “everyone pulls their weight” ethos, where most workers take tasks on a voluntary basis. As such, many DAOs can offer widely branching career options: one could start as a developer, but work towards becoming a writer, community manager, marketer, or product manager.
Compensation is generally paid in crypto or in FIAT, either a fixed amount on a monthly recurring basis, or proportionate to one’s contribution.
Some even have the option of getting paid a constant salary per second.
Web3 workers will have the future option of becoming an in-demand consultant, and also have their pick of jobs in fintech, venture capital firms, companies, or even the public sector. Web3 expertise will be invaluable.
And since DAOs and Dapps have only been around for a few years, having this kind of experience of this kind is fairly rare and is often at a premium.
How do Crypto Businesses Make Money?
Today, many people still think of crypto as a speculative investment, but they may overlook the element of business that is deeply entwined. DAOs are the new workplaces for crypto natives.
DAOs run protocols, which are almost mirror copies of real life businesses. There’s payroll, organizational hierarchy, expenses, revenues, and periodic reporting. Profit generally comes from trading fees, or interest fees, which is paid by users or other DAOs in exchange for goods or services supplied.
For example, The Index Coop is a DAO that runs a series of financial products that allow investors to diversify their investments. They make their revenue via a ‘streaming fee,’ which incentivizes their community to research and create desirable products for users.
Protocols find other ways to earn as well, e.g. by providing trading services, data feeds, interest-based lending, tranching, options, audits, insurance etc. All this comes with a fee, but the process is much more transparent and fair than what we get in traditional finance.
Consequently, DAOs and crypto businesses have huge war chests, and are more than willing to pay for talent and expertise. With a waiting list of VC’s and angel investors not far behind, they could rival many of the best funded startups in the world.
See for yourself, here are the top 8 DeFi protocols and their treasuries:
The Growing New Behemoth of DeFi
The term “Altcoin” is so 2017. Tradeable tokens on the marketplace are only a thin slice of the miles-deep glacier that is Decentralized Finance (DeFi). Underneath, we find a rich network of interconnected building blocks that forms a full financial system secured by incentives and DAOs working in tandem.
Taken from DAOs — The new frontier in Coordination, by Gitcoin and Bankless DAO
It is impossible to explain all of what DeFi is in a single page, but here is a quick overview of what it currently offers:
- Lending protocols allow crypto asset holders to borrow against and spend the value of their holdings without having to sell. This also creates a money market that allows depositors to earn interest from borrowers using stablecoins or other assets.
- Savings protocols (also called vaults) allow depositors to earn a fixed or variable interest over time, while generating yield from the underlying asset via a separate protocol or strategy.
- Decentralized exchanges allow the trading of various coins at market value. Exchanges gain fees, which are distributed fairly to liquidity providers. Providers also gain incentives to offset the risks they undertake.
- Synthetic protocols allow for the trading of digital assets that mirror the price performance of real life assets while removing geographic or minimum capital restrictions, creating the basis for universal market access.
- Auditors check code for security and attack vectors that can create claimable events.
- Insurers underwrite the risks of claimable events in return for a fixed yield from protected users.
- Bug Bounties, such as those hosted by Immunefi, provide a sizable incentive for whitehat hackers to research and disclose bugs responsibly to protocols.
- Indexers and Yield Aggregators allow for portfolio management and risk diversification. The difference being that indexes hold assets passively, while yield aggregators use them actively in yield-bearing strategies.
All these activities and more make up the estimated $80 billion (and possibly more) dollars of total value locked in DeFi today — a 16x gain over the last two years. In other words, DeFi is a fully functional, composable ecosystem that’s ready to explode into the mainstream.
It could be in the next 6 months. Or it could very much be in the next 6 weeks. Decentralized lending protocol AAVE is already in talks with institutions to launch a KYC-enabled lending product known as AAVE Pro.
Another protocol, Compound Finance, has already launched a regulated Treasury product that allows institutional customers in four major U.S. states (California, New York, Florida, and Utah) to earn fixed yield from stablecoins.
Yotta, an app that encourages US customers to save (it offers other FDIC-insured savings products in FIAT), has also started to introduce crypto savings in the form of stablecoins to its customers.
The final decision of whether or not to work in Web3, of course, boils down to your own choices. Do you want to stay on the sidelines, while a historic technological revolution passes by?
If the answer is no, you’ll find that with some time and effort investment, it’s not too difficult to adjust to Web3. Overall, the working tools are pretty similar: email, Slack, Github, Zoom, and G-Suite services (Docs, Drive, Slides etc.).
There are plenty of ways to go about learning Solidity, including free tutorials like https://cryptozombies.io/. And since nearly all of blockchain technology is open source, there are mountains of free resources available to refer to, like this one.
We have a comprehensive list of these resources and tools listed on our website at https://immunefi.com/learn/.
Twitter is also a great place to start networking in Web3, and build connections that can land you your first DAO job. You may also want to create a Telegram account, as well as Discord, to stay connected with DAOs and protocols in the Web3 space.
And as mentioned earlier, Gitcoin is a great place to start looking for bounties whenever you’re ready to start work. Or you can learn to become a competent whitehat hacker by joining our Immunefi Discord community, and browsing our available bounties, which are the largest bug bounties in the world.
But crypto isn’t all roses. You may have heard some negative views on crypto — for starters, that it’s bad for the environment.
UCL has already published a study that concludes that the new generation of Proof-of-Stake blockchains (Ethereum, Cardano, Polkadot, and others) use 1/1000th or less of the same energy as Bitcoin’s Proof-of-Work algorithm.
In fact, these gen-2 blockchains are already more efficient than Visa’s Paynet. With further optimization still possible in the form of zk-rollups and layer 2s, this efficiency can potentially use only 1/1 millionth of the energy of a Bitcoin transaction.
So, what’s more likely: finding a more efficient energy source, or integrating the advantages of blockchains into existing payments networks, like what Visa is already doing?
Others have complained that the industry is both scammy and spammy. This has undeniably been a part of crypto’s earlier life stages, but these sorts of behaviors are common to every new industry and naturally settle out over time. The frontier is a wild place, but as evidenced by traditional companies acquiring crypto companies, the space is rapidly professionalizing and becoming more ethical. Norms are improving.
Things are moving so fast, we can barely even keep up. What’s new now will be old in six months. There’s never been a better time to build in an environment that actually believes in building.
The only question is: are you in?
If you’re interested in joining Immunefi, DeFi’s leading bug bounty platform with the world’s largest bounties, check out careers page here. We have lots of opportunities in all sorts of areas.
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