I lived in Web2.5 for 5 days: A Web2 Engineer’s Reflections on ETH Denver
This whole thing is crazy. The people are crazy, the tech is crazy, the money is crazy.
This semester, alongside my third software engineering internship, I am interning at RareSkills, a Web3 edtech startup, led by Jeffrey Scholz, that trains blockchain engineers. They are best known for their Advanced Solidity Bootcamp, Zero-Knowledge (ZK) Bootcamp, and ZK Proofs Book, and this year I traveled with them to ETH Denver, one of the largest crypto events of the year, as a research intern.
Word of warning for my strictly Web2 friends, the next two paragraphs might seem like a lot. It could be a good source of learning and initial exposure for you, but feel free to skip it if it overwhelms you.
It’s fair to say that I came into ETH Denver relatively, extremely, underqualified. I had read DeFi and the Future of Finance by Ashwin Ramachandran, Joey Santoro, and Campbell Harvey and from there I had developed a basic understanding of certain key protocols in the Web3 space like lending protocols, vaults, auditors, oracles, liquidity providers, Uniswap, Compound, Aave, and all that beginner stuff.
As a part of my onboarding at RareSkills, I learned about scalability issues of smart contracts and L2s, how ZK enables L2s, EVMs, and was introduced to the different consensus mechanisms and transaction fees of different blockchains, both L1s (Solana, Avalanche, Ripple, Cosmos , Ethereum, BNB chain, Polkadot, XDC, NEAR) and L2s (zkSync, Aztec, Linea, Starknet). I also dove a little deeper into the various protocols (the Web3 equivalent of a Web2 startup) and their corresponding products in the DeFi space like Synthetix which offers permissionless derivatives like perpetual futures, Opyn and options trading, Lido and liquid staking tokens, and more.
I felt like I had learned a lot at this point, but I had no idea what ETH Denver had in store for me; I had barely scraped the surface of Web3, I was like a newborn baby thinking the hospital I was born in was massive.
As a Web3 newbie there were two main things that stood out to me throughout the conference:
- Vastness of the space: The applications of the tech stack (blockchain) seemed boundless
- Unwavering Optimism: The amount of people that truly believe in blockchain and decentralization
Vastness of the Space
This realization came fairly quickly to me, within about 2 seconds upon stepping into the conference hall. The sheer number of booths was surprising.
I was cynical at first, initially questioning how many of these protocols were actually doing different things, especially since almost all the booths featured the same buzzwords: ZK, L2, Smart Contract, Oracle, Permissionless, Open Source, Rollup, Audit, Security.
My skepticism, however, was moderately alleviated within a few conversations. I realized that they’re not just doing the same things, they’re doing different things with the same tech. Again, some skepticism remained as to just how different they were. Were they all just the Web3 equivalent of the ocean of lame GPT wrappers?
But this skepticism was again quickly subdued when I realized that it cost $20,000 to set up a booth at ETH Denver. While this does not necessarily mean that every protocol and their respective products are extremely distinct from one another, it does mean that they are sufficiently distinct from one another and somewhat “legit” enough to have $20,000 to spend on a booth.
My notion of the vastness of the space compounded with every conversation, where I heard something very different from each person. Not everything I heard sounded intelligent or sustainable (my understanding of the space is admittedly limited but my opinions were verified by my extremely intelligent colleagues), but none of them sounded boring or repetitive.
The bulk of the conference was talking to passionate developers dressed entirely in bright pink and purple or an outright questionable unicorn onesie, which brought me to my next realization.
Unwavering Optimism
I described this realization as “the amount of people that truly believe in blockchain and decentralization.” As clearly indicated through the italics there were two components to this realization:
- High Amount of Believers
- High Degree of Belief
The existence of both are crucial to the legitimacy and sustainability of a movement. If only one of the two exist, the movement would be insignificant and easily dismissible.
What drives this widespread adoption and enthusiasm for Decentralized Finance (DeFi) as a movement?
To understand the answer to this question, we must first understand why banks as we know them today came to be. The first banks emerged as institutions to facilitate trade, safeguard money, and lend capital to businesses and individuals, thereby playing a crucial role in economic development. Society needed a medium to exchange “money”, it would have been extremely impractical to have had to send gold across the sea every time an international transaction took place.
However, as these institutions grew in size and influence, they became gatekeepers of financial services, often with high barriers to entry for the unbanked or underbanked populations and accumulating power that could lead to systemic risks and inefficiencies. The exclusivity, opacity, and centralization of the traditional banking system have led to financial crises, such as the global recession of 2008, which exposed significant vulnerabilities in the system.
Decentralized Finance (DeFi) emerged post-2008 crisis through Bitcoin in 2009, offering a financial system that’s open, transparent, and universally accessible. Using blockchain technology, DeFi operates without central control, mitigating risks and enabling direct financial services via smart contracts.
The enthusiasm for DeFi is driven by its potential to democratize access to financial services, enhance transparency, and innovate beyond the limitations of traditional banking systems.
Now you know the story, kind of (feel free to check out DeFi and the Future of Finance by Ashwin Ramachandran, Joey Santoro, and Campbell Harvey for a deeper explanation.) If you’ve dealt with banks before, you know exactly why DeFi makes sense. Dealing with banks are a hassle, there are fees and policies left and right, a good majority of which are unnecessary, which make navigating financial services tedious and inefficient.
The unwavering optimism among DeFi was a central theme across every conversation I had throughout the conference. I met many, many senior Web2 engineers, accountants, and marketing directors who left their cushy high-paying jobs at Yahoo, Amazon, EA Sports, eBay, KPMG, and many more to build cryptocurrency exchanges, smart contract audit companies, L2 protocols and ZK solutions.
At this point, it might be tempting to classify them as a deluded minority brainwashed by an extremely passionate ecosystem. But when the companies that run our global economy are invested in this tech, wary skepticism towards Web3 slowly transforms into lazy ignorance.
Amazon developed a product on AWS called Amazon Managed Blockchain designed to help users build Web3 applications by providing blockchain data and APIs.
In 2021, Nike took possession of creative studio RTFKT, launched CryptoKicks IRL collection, and is now gearing towards immersive experience for its digital community. They also own their own NFT platform, Dot Swoosh, a platform for their NFT owners to access a “metaverse” shopping experience.
Sony has already began an incubator program with Japan’s most popular network, Astar Network, to drive growth for web3 startups.
In August 2022, Tiffany & Co embraced Web3 by providing token-gated access for CryptoPunks NFT holders. They collaborated with CryptoPunks, allowing existing CryptoPunk owners to obtain a Tiffany & Co CryptoPunk pendant priced at 30 ETH (about US$104,000 as of the time of writing this article).
These are just a few examples to illustrate the scale of and reality around Web3 in the world around us, there are still a lot of other mega companies that have invested in Web3 integrations.
Conclusion
The support for DeFi today has expanded beyond the seemingly foundationless and cult-like following it had over a four years ago. Real money is being invested into this movement. Entire lifetimes and careers are being invested into this movement.
There will be events and headlines that will discourage people from embracing Web3. Bitcoin might drop. Web3 companies might crash and burn. It will happen, it will not matter. Just because Cruise has temporarily halted operations, it does not make computer vision and automation irrelevant. Just because ChatGPT often cites false sources and has, perhaps more dangerously, been publicly convicted of racism and sexism, it does not make NLP and LLMs irrelevant. Just because the Apple Vision Pro has been said to cause eye strain, headaches and motion sickness, it does not make augmented reality irrelevant.
AI is not perfect, but it’s real and it’s transformative technology. Augmented reality is not perfect, but it’s real and it’s transformative technology. In an identical vein, blockchain is not perfect, but it’s real and it’s transformative technology. Imperfection is at the heart of innovation, and it is our responsibility as a species to embrace progress, whatever form it may take.
“Web 3.0 is the next phase of the Internet, where intelligence will be built into everything and the web will become truly semantic.” ~Tim Berners-Lee, inventor of the World Wide Web
Author’s note
Thanks for taking the time to read my article! There were many smaller takeaways that didn’t make this article, so if you are interested in learning about them feel free to reach out to me personally, but I made sure to include everything that I felt was worth posting.
