Why We Build
From Web 2.0 to Web 3.0 towards a human-centered internet
As we ring in the new year, it is a good time to reflect on the drunken euphoria and subsequent sobering around crypto and blockchain, which has invited speculators, fraudsters, opportunists, regulatory scrutiny, and, for those of us actually trying to build something, a lot of headache. Even for the well-meaning, how do you begin to explain this new paradigm of a decentralized internet, and importantly, a responsible way for how to fund the development of these decentralized networks and ecosystems?
For those of us working in the space, the excitement that gets us up every day, despite knowing the realities and difficulties, comes from a deep-rooted sense of what we are building, a true sense of possibility. There is a real revolution here beyond the cyber punks, beyond the price of Bitcoin, beyond the the corrupting haze of greed that has engulfed the industry.
Blockchain is the story about the evolution of the internet and our socio-economic relationship to it. I am actually old enough to remember the original internet, sometimes called Web 1.0, when I used dial-up and made webpages in Geocities in my parents’ basement. The explosion of new wealth, business models and social engineering systems came with Web 2.0, which made the internet dynamic, birthing social media and the sharing economy. Web 2.0 brought about a new social physics, challenging how we think about privacy and ownership and control of information, how we work and the ownership of labor, and of course, how we communicate and connect with each other.
In 2006, John Markoff of the New York Times popularized the term Web 3.0, when Facebook was still in its infancy and before Uber and Airbnb were born. Web 3.0 would be a more intelligent, open and distributed internet. Blockchain and decentralized computing is the foundation of Web 3.0; it is the second coming of the internet, fulfilling the original promise of the World Wide Web to be free and open. While Web 2.0 has democratized many power structures and created new opportunities, the economic engine of the internet has been largely privatized and monopolized, what was meant to be a public good. Web 2.0 businesses like Facebook, Uber and Airbnb created private networks on public infrastructure which they monopolized.
So what is the model for Web 3.0, which will return the internet to an open source ecosystem? An open source ecosystem or network is a public good that cannot have its own revenue model. Rather, the technical and social engineering required to develop such an ecosystem will enable multiple profit centers across a decentralized network. While Web 2.0 is about single profit centers monopolizing a privatized network, Web 3.0 is about multiple profit centers sharing value across an open network.
The individual profit centers participating in the open network will have their own revenue and business models, but the underlying public network cannot or else it would become a rent-seeking monopolist network. The real revolution behind Web 3.0 systems is that the total economic productivity and contribution of these multiple profit centers in a decentralized network will far outnumber that of monopolist profit networks. We may even entertain the possibility of value generation that is not simply reduced to profit generation, whereby we can tokenize alternative metrics of value besides profit that contribute positively to economic development and resilience.
Identity, content and data will return to the individual. The internet becomes more human-centric without losing the power of economies of scale. New value systems will be unlocked. At ixo, we want new value systems to surface around contributions of social impact and sustainable development projects to society, so that society can resource more capital to these important and necessary projects in ways that are cheaper, more accountable and less reliant on institutional funding that is often centralized, slow and politicized.
As an entrepreneur who left the comforts of a stable “prestigious” career at big law firms and Wall Street, I only want to work on these Web 3.0 ecosystems because I find the problem space intellectually challenging and inspiring enough that it’s worth all the bullshit of being an entrepreneur. Working on Web 2.0 apps (the Slack of X, the Uber of Y) is simply not a problem space that’s worth the pain for me personally and many of the brilliant people I know in the blockchain space.
We are not here because it is a cool and hot thing, or to make a few quick bucks as overnight crytpo millionaires. We know the shit is hard, but we get up every day with our eyes wide open because we believe in putting in the work that a true revolution requires. It is intoxicating to be around brilliant people who believe in their values and building a decentralized future together. This is what keeps me personally going during the lows and turbulence of rapidly changing market and regulatory winds. We need more people who want to build and we welcome them to join the revolution and not the hype.
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