Author: Spike
Original editor: Jerry Crypto
Author: Spike
editors note
In the world of Web3: Decentralized technology, what the public wants; application value, what the public wants. It is impossible to have both.
Mencius said: fish, what I want; bears paw, what I want. It is impossible to have both.This article will try to analyze the gap between the vision of Web3 we are looking forward to and the actual ecological construction, and on this basis, explore the path to break the situation. The full text will be divided intoandPart 1 Paradoxand
Part 2 Breaking the game
NFT
DEX Uniswap
Compound、Maker、Aave
USDC、DAI
Filecoin
Lab DAO
Toucan
Golden
Radicle
Helium
……
Released separately.
In the concept frenzy of Web3, a series of fantastic DAPPs have taken root and sprouted, and under the nourishment of the idea of decentralization, they have sprung up like mushrooms after rain.
However, after several years of development, what we have seen is that once CloudFlare collapsed, the oracle machine stopped singing, the exchange could not match... most of the projects collapsed into sand.
Why cant the decentralized underlying architecture support application scenarios that conform to the habits of the public?
Why cant top-level applications such as Twitter and Facebook be born from the concept of blockchain upgrades?
Why cant the encrypted world, which is concerned about user privacy, wrap up a silky user experience?
Why cant Web3 applications form a flywheel effect and roll forward?
Although there are so many soul tortures, the reality is that almost no one stops to think: what is the gap between the ideal decentralized design and the actual application ecological construction?
But from a practical point of view, Web3 lacks executors and promoters of practical implementation. Although any major technology related to social change is inseparable from the accumulation and empowerment of the market, wealth, and interests, the development history of the encrypted world is completely penetrated by the desire for wealth, from project developers, studios, and investors. Institutions, down to speculators, hodlers and other major participants in the encryption ecosystem.
The industrial iteration, era change and social evolution supported by the bottom-up Web3 application ecological construction, and the game of interests of all parties in the encrypted world currency circle have made all this fall into a paradox.
secondary title
VC: the invisible driving force behind Web3
In the hands of Token, in the name of construction
In the final analysis, the existing Internet industry structure is still a linear relationship of scale for growth, traffic for valuation; but Web 3 does not have a central carrier, and the previous valuation logic cannot be used to evaluate the input-output ratio. All business models and product designs of Web 3 need to be refactored, and a non-linear relationship is used to break the critical point and reach a considerable number of users-this model can be compared to the interconnection of the human brain through various synapses, Ultimately complex thinking occurs.
This decentralized reconstruction means that the distinction between individuals and enterprises will gradually narrow, and the commercial value of each person, every small and micro enterprise, and even any social group can be mined (Token) and transmitted (Web 3 social), And the relationship between them can be migrated (social graph) and stored (IPFS).
However, the problems existing in Web 3.0 at this stage are obvious:
1. Lack of real use demand mining:
Web 3.0 mainly relies on copying the ideas of Web 2.0, and frequently launches decentralized versions of various centralized services, lacking in mining the real needs of users. For example, we dont want a decentralized version of Twitter, we just want a social protocol that can preserve social relationships, content can be NFTized, the platform is resistant to censorship, and can protect our privacy.
2. Users take profit as the primary motivation:
Users do not use products for value and real scenarios, but for profit, which is why X2E and its imitation disk projects emerge in endlessly. But this model can only attract gold diggers in the entrepreneurial stage, and will not leave a real user group.
If you want to be firm in long-term Web 3, you can’t see returns without long-term investment. At least you need a business model to take shape before you can get results. Only when the universal application is born, is the time when Web 3 really breaks the game. But we have to accept the reality that there are about 4 million DeFi users, about 500,000 active NFT users in OpenSea, and less than 10,000 users of Web 3 social protocols.
Why is the actual user scale of Web 3 so small? Because of the Token mechanism boosted by VC.
The logic of VC in Web 2 is: continue to invest, seek a monopoly position in a single track, occupy the entire market space, and continue to obtain excess profits.
The logic of VC in Web 3 is: use investment as a bargaining chip, seek cheap tokens in the early stage, use the secondary market as a place to sell, and use the token exchange as a node to quickly squeeze out the value of tokens.
The Token mechanism of Web 3 has become a reservoir for institutions and VCs without any responsibility. There is a bug mechanism here that allows traditional institutions to use Token to attack arbitrage.
When users use search engines, they may indeed care about privacy and data security, but the most important thing is to meet the demand for search. This is the fundamental reason why the Web 3 construction path cannot be equated with DeFi and NFT. The use value of a product should be prioritized over price mechanism.
For example, when a user uses EthSign to sign a commercial contract, the most important thing is that the contract cannot be tampered with. This is the core advantage of Web 3 products over other tools. Users do not need to understand what on-chain and smart contracts mean, but they can know This allows contracts to be permanently archived.
image description
Source: EthSign
As we all know, the market acts on the basis of maximizing personal interests, but the current market is dancing based on maximizing the interests of others - this cat teaser is called Token. Let us use a picture to see the evolution process under the blessing of this Token.
After the Token is used, some project parties will choose to sell it together, or have no choice but to maintain the operation. For example, after Uniswap acquired the NFT aggregation trading platform Genie, it actually used USDC as the backtracking airdrop currency instead of using Uni tokens. The de facto death of coins.
In Satoshi Nakamotos vision, Token is a form of proof of work. However, under the command of VC, the significance of the project is for the price of Token, and the strategy of institutions and projects for Token is a channel for quick exit, rather than the key to maintaining the operation and development of the project.
secondary title
Empty shell: from infrastructure to application scenarios
When we talk about Web 3, the entire concept involved in this theme - from social graphs, creator economies to SaaS and collaboration tools, seems to be complete, just wait for a command, and Web 3 will quickly occupy the online world become infrastructure. But in fact there is nothing - as soon as CloudFlare crashes, the oracle machine stops singing, the exchange cannot match...
We suddenly discovered that under the concept of Web 3, with the support of the underlying public chain, there are still lower-level Internet protocols in operation. Under the grand vision of Web3, we can find the current gap between ideal and practice: Web 3 is just an empty shell.
image description
The bottom layer of Web 3 is still traditional infrastructure
Without the reality of a phenomenal application, the flywheel effect of the Web 3 ecology cannot be rolled up. For example, the current social protocol focuses on the concept of SocialFi or social graph, and the popular BBS Network, 50% of its tokens will be distributed to active users. So how to increase the activity? Of course, it is to create high-quality information. Under this logic, more traffic is imported, and active users of followers and subscribers will reap more benefits. This mechanism comes from the imitation of transaction mining in DeFi, artificially creating enough bubbles, and finally leaving a lot of chicken feathers.
The languages used by mainstream developers to flood into exchanges and other cash flow-rich tracks are basically Java, Go, Javascript, etc., and Rust, solidity, etc. are only used when it involves on-chain interaction. If they dont realize the great significance of Web 3, then the blueprint will never be realized without construction. Why do Web 3 applications lack real usage requirements? ——The reason is very simple, because the product is not easy to use. Behind this is the extreme scarcity of high-quality developers. Users are scarce in the Web 3 ecology on the surface, but based on the tens of thousands of current Web 3 users, there are few exploratory applications, and more technical and basic development tools are still needed.
When the bear market comes, coinbase and bybit will even lay off employees, and these developers will be lost again, further deteriorating the strength of Web 3 development. In the blockchain world, high-quality developers have a huge driving force for new tools and new technologies, but the current situation is that they are being squeezed out of the field of Web 3 infrastructure development. The Web 3 ecology can be said to be ready for everything, but it lacks talents.
secondary title
Future: Who is the one who bows out?
We briefly outline the relationship between Web 2/3 - hopefully we can get a glimpse of what the future of Web 3 looks like.
- The basic hardware is currently the same: still desktop and mobile. Metas VR devices are not directly related to blockchain technology or chain games. GameFi is mainly based on web pages and clients and does not widely access VR and other devices. This is a key point that is intentionally or unintentionally ignored. VR equipment is also laying a wider use path.
- The underlying protocols are diverging: the underlying network has not completely abandoned HTTP, browser, TCP/IP and other protocols, but UX/UI is changing, regardless of beauty and ugliness, anyway, cyberpunk is the main orientation, in other words , the public chain as a communication protocol, and IPFS as a database model have not completely replaced the existing communication protocols and centralized databases.
- The current Web 3.0 is mainly based on concepts: Internet + re-evolution --> Web 3.0+. If this is an inevitable story, then the concept of Web 3.0 as marketing itself can be considered as an extension to the real world.
- The product is still in the process of iterative research and development: the life cycle of Web 3 products is no longer fixed, and will enter an era full of liquidity: services that run out can also be tokenized and NFT-in essence, tickets are used Once it is no longer used, the marketing service can also be used up, as long as there is a consensus between the buyer and the seller, it can be called Token as a service.
However, this still requires a process to realize. There are three main types of people who are talking about Web 3.0:
The first category: Practitioners of traditional Internet giants
Now they are eager to try, mainly because the traditional traffic model has come to an end. Among the big factories that are collectively involved, some people are already preparing to sail into the new channel, but if they don’t change their thinking, they will be like Facebook’s Libra, or the so-called The alliance chain technology is the same.
The second category: crypto native
This kind of people may start from the public chain, such as Flow, which began to advertise itself as the Web 3 public chain, or started from the DeFi/NFT/Metaverse project organization, or jumped out of large factories and institutions to participate in the construction of Web 3. They are currently the most important group of people. Just like the Aave team that developed Lens Protocol, everyone must learn to embrace change.
The third category: variants of MLM
The essence of MLM is that the product model is essentially unprofitable, and in practice, it is a financing operation model based on attracting people. Such people will not have a real interest in product construction, but they are often the loudest, hoping to attract as many people as possible to participate in it. Ordinary people will have the stereotype of Web 3 = scam after being deceived.
Only the second type of people will become the main force, and in the future, more and more different types of people will enter this magical space, give full play to the human brain, and create truly valuable product services and usage scenarios.
The adaptation speed of Web 3 is super fast. We must believe in the iterative speed of new product models. For example, Nansen has cooperated with Google Cloud to provide real-time market data. This is like joining if you cant beat it. Web 2 and Web 3 are not isolated, but more like twins. Web 3 also leaves time for Web 2 to adapt and evolve.
The fit between the two parties is that, “Nansen said the data will help market makers, hedge fund managers and asset managers train their algorithms to predict market movements, generate reports, indicators, etc.” When new trends take shape, more The mainstream group will participate, which is a good start.
