It’s weird that this article waffles on about PCs and how the author thinks that’s a good analogy. It’s not very convincing because you could easily pick another technology pair and show it the other way (often worse is just worse).
But the thing that really seems weird is that all you need to do make it interesting is 1) define what you mean by web3 (it’s a slippery weasel word that changes meaning whenever the people using it needs it to) 2) define a few uses that are obviously better than the alternatives and justify them without hand waving (including explaining why what would appear to be fundamental show stopping flaws are not in fact that)
If you can’t do that (and no one seems to be able to) the maybe, just maybe, it is bullshit?
Part of the profit part of the web does not include decentralizing tech... This is the one thing that makes everything a scam. If you mint a new coin or NFT, there is always a bunch of actions a seller or buyer can take to either bolster or undermine the price of the asset.
Web 3 is also based on an economy of popularity and/or financial backing to either increase value or disparage an asset, which makes manipulation rampant, and it also makes the "Web 3 economy" inherently corrupt. Frankly, it's not a movement, it's really to me just a mutation of MLM and pyramid-scheme marketing online.
Sorry to be so harsh, but the way it's being spammed at all of us every day, and infecting real online commerce is abhorrent, and growing to the point where not much can be trusted when Web 3 is mentioned for me.
Me I d define web3 by referencing the websocket arrival that evolved from Ajax polling to have better data subscription and the rise of full js frameworks which transformed the amount of work clients do on web resources that sometimes couldnt be done by the backend (drawing a financial graph full of beautiful indicator and refreshing live for instance).
I can understand web4 could be self financing unstoppable web resources with no central authority able to close them but I dont see yet a proper use case beyond criminal endeavour. Plus, we're far from it, we'd need an organic transmission network that goes out of the traditional ISP system, like a global bluetooth peer to peer mobile network every phone contributes to in exchange for payment... that would be fast enough...
When I studied at University 15 years ago web 2.0 was in full swing and the academics where busy talking about web 3.0 which was at the time understood as "the semantic web".
Wikipedia, OpenStreetMaps, DuckDuckGo would all be great examples of self-financing unstoppable web resources with no central authority distributed across a peer-peer mesh network.
Unclear if the value prop is large enough to overcome the activation energy of such an endeavor.
Criminal endeavours are not equal. Some are trading drugs and murdering people, others are overthrowing authoritarian dictators like Putin or Lukashenko.
As you can imagine, the latter activity is criminal in Russia and Belarus.
I don't really know much about web3 or what it will happen in the future, but these same debates happened ith other techs before which are now mainstream in a similar fashion as this here.
People like pointing out echo chambers all around while they are also in one.
Remember all the feathers ruffled with cloud computing? It just servers in a data center! Serverless? There are still servers! web2.0 s just ajax requests!
If people dump money into it, then something is likely to come out whether is better or not than what it was before. Maybe is worse, or maybe something will be built on top of it that will be better or some othere political event might make it relevant. Who knows
It’s called survivorship bias. Most things that people called bullshit we don’t remember because they were bullshit so why would we remember.
Now “crypto” is a little different because the the promise (not always followed though on, it’s still negative sum) of money to anyone who can bring themselves to believe. Like many bubbles and ponzi-like schemes before it’s primary functionally is to promote itself, and damn that’s one of the few things it’s really good at.
> feathers ruffled with cloud computing? It just servers in a data center! Serverless? There are still servers!
Unlike the crypto ecosystem, those offered a tradeoff of higher cost and less control for greater convenience and ease of management. Which was hugely successful.
They're also not ... hegemonizing? in the way that cryptocurrency seems to be advocated.
I think the PC analogy is solid. I think the observation that we need a way to permissionly interact with data is spot-on, and I agree that that could bring a second wave of value creation and innovation.
Think of having a Facebook-like social graph, not controlled by Facebook. Or a merchant aggregation system like Amazon's without Amazon. A system not driven by maximizing exposure monetization (via ads, paid placement, etc.) but by something like a Nash equilibrium that maximizes value creation for participants.
This is what I work on, and I think it can be done.
Maybe the onus is on the skeptics to conclusively prove that web3 is BS? Since none can effectively prove so, then maybe it is not BS?
The skeptics are always inventing new reasons why it will fail, and yet it's still here and bigger than ever, day after day, making the skeptics seems crazy at this point, pointlessly arguing for lack of use for something that is clearly useful, judging by the sheer amount of capital and development resources used, if nothing else.
Yes it’s totally normal to take a word with no real definition (or at best a definition that shifts depending on what’s needed) and have to “prove” it’s BS.
If I tell you that web4 is all about complete freedom and an end to world hunger and it’s based on cow farts is it up to you to prove that it’s BS? (It’s early days for cow farts, you can’t judge them o what they can do right now)
I think that the original idea behind crypto is still the most interesting. It's programmable money. Large swaths of the finance industry exist to make money programmable. Why not build it into the monetary system directly?
The general historical trend is to make money more abstract and to be able to perform more complicated functions with it. But fundamentally money is a social technology that consists of three things: An abstract unit of value in which money is denominated, a system of accounts, which keeps track of the individuals' or the institutions' credit or debt balances as they engage in trade with one another and the possibility that the original creditor in a relationship can transfer their debtor's obligation to a third party in settlement of some unrelated debt. [0]
Crypto seems to satisfy the essence of that in a pretty cool way. DeFi projects are experimenting with the question of, "can we build the financial instruments and capabilities that a complex economy require on top of, and directly integrated with, this type of monetary system.
Like any technology that requires a large network of users to be valuable it has a difficult bootstrapping problem. But it seems to be gradually working its way to larger and more important transactional contexts. First with illegal digital marketplaces and now in countries with weak monetary system like El Salvador (and with unbridled speculation along the way).
Maybe all of the current crypto projects will fail but it will be interesting to see the nature of monetary systems in 10, 20 and 50 years from now. What aspects of these current experiments have been adopted?
> Put differently: it turned out that permissionless publishing alone was insufficient. We also need permissionless data.
Has the author ever heard of OpenStreetMap, Wikipedia, or a million other projects like them? I'm also not quite sure "permissionless data" is how I'd describe a database that stores tiny amounts of data at a massive cost. Pay-to-play is permissionless iif you have the money.
Wikipedia database is managed by the wikimedia staff. You have the permission to edit it for now but can not guarantee it will be make available always. This is what the author meant.
Opensea is managed by opensea staff, Bitcoin and Etheream are in a very concrete way managed by the devs. You absolutely cannot guarantee anything about access in the future for sites based on web3 - if anything it is worse as there are two gatekeepers, the site owner and the cryptocurrency (so for example gas fees might go up making a tiny transaction very expensive, or a currency might fail).
Nobody wants a truly distributed org because it is impossible for anything to get done, just as nobody actually wants to use a distributed currency because the costs outweigh the benefits, and the web we have is distributed enough, though of course it has flaws and is in some ways too centralised now, but I don't see how web3 as currently sold helps to solve that.
The biggest problems currently are around identity (SSO), and microtransactions, but neither of those are solved well by existing cryptocurrency solutions or things like NFTs.
> can not guarantee it will be make available always
True! However I trust the wikimedia foundation, and the fact that because it is a valuable dataset there are many copies of it. If they really did restrict access, anyone could spin up their mirror.
Most of the decentralisation arguments seem to rely on some fetishistically absolute version of the world where you cannot trust any single person or entity, and crypto/web3 is the only reasonable solution if that is true. I, however, have more faith in other people, and am fine placing trust—to varying degrees—in others.
Since the ICO craze in 2017 I've seen countless ideas and millions spent trying to use blockchain and crypto for everything you could possibly imagine, and yet I don't see anything meaningful has ever came out of it, apart from get rich quick schemes, ponzis and some virtual novelty items.
Bitcoin has been around for 12 years, but in real life I don't know anyone who has ever used something crypto related for anything else than risky investment, or basically gambling. I'm very skeptical.
I've never met anyone who's ever used their stock certificates for anything other than speculation.
However, I have participated in a multisig that controls six figures of funds with a handful of strangers on the internet. I have used my governance tokens to vote on DAO proposals regarding new product lines and features. I have created and sold NFT artwork. I have registered a domain name and set an immutable record on a smart contract linking to a website and an Ethereum wallet. I have used it for logging in to software. I've built software that gates access based on ownership of a particular NFT. I've stored data on Filecoin and archived it on Arweave. I've borrowed money on-chain. I've commissioned artwork and paid in ETH. I've bought gold with Bitcoin. I've helped raise a million dollars for charity with a major celebrity. I've contributed to Gitcoin grants for public goods software funding. Your skepticism just closes your mind and blinds you to what's possible.
Sure - and these are all great examples of what you can do with crypto. Where I see parent pushing back is that all of these things were already possible before. You could buy jpg's with credit cards, you could buy gold with the dollar.
Before the spreadsheet it was extremely difficult to do arithmetic at scale. After the spreadsheet it was much, much quicker.
What's the killer feature that cannot be replicated easily without crypto?
Pretty bold stuff! Thought people had generally accepted DAO's and NFT's as likely scams.
Do you want to actually share the URL's for these things? Shit, does web 3.0 even use proper URL's? Where is this magic land of highly democratized services? And why isn't a URL, perhaps the most fundamental tenet of the "web", _ever_ shared in these discussions?
Perhaps it would illuminate the fact that this stuff is all highly centralized already? With most services requiring personally identifying information in order to use them? Wonder what that's needed for...
It's a long article which says that Web3 is a database which nobody owns followed by a lot of hand-wavy stuff that you see everywhere else.
The worst part of this is that I feel like I could get dragged into this. That at some point I'll have no choice but to start digging into this and dedicate time to other stacks because the money behind Web3 succeeds in shoving it down everyone's throats.
This is someone talking about technology fixing problems, but ignoring the messy real world. For example, we have repeatedly seen how governments can control things which "nobody owns."
Another item which stood out was the idea of Web3 taking back control from the big tech companies. But if they are monopolies, then shouldn't it be the government which takes them down?
Because VCs have heavily invested over the last few years in blockchain companies and cryptocurrencies in general, they need to keep pumping this bubble, so NFTs, web3 etc became necessary to invent.
Web3 is just the latest excuse to keep the game of musical chairs going and preserve the chimera of use-value for cryptocurrencies since very few people want to use them to actually transact.
You mean the thing when the ETH people are going to hand the power over the people with the most money? I'm sure this idea is deeply chilling to... venture capitalists, they're probably shaking in their boots.
Because Proof of Work requires computational power, which is expensive and thus requires a lot of capital, and Proof of Stake requires controlling a significant amount of the currency, which also requires a lot of capital. Basically the consensus is built around ways to demonstrate you already have a lot of money, either through conspicuous consumption (PoW) or flaunting your balance (PoS).
As to why VCs would invest in it: it's currently dodging most regulations that apply to financial transactions (money laundering, pyramid schemes, pump & dump schemes, etc) much like loot boxes dodge most gambling regulations (and it turns out selling gambling to kids is extremely profitable). This makes the market uniquely profitable to invest in right now with promises of extreme ROI as long as it remains unregulated.
"Humanitarian" campaigns to normalize tracking public records and qualifications on the blockchain in technologically underdeveloped countries also produce a high amount of technological lock-in while increasing the capabilities of automated decision making on the blockchain without having to bother with externalities. For example, if one's ability to use an NFT on social media hinges on demonstrating ownership of that NFT, copyright law becomes a tangential consideration much like systems like ContentID make it harder to claim fair use rights because the ContentID claim is not based in copyright law but in the terms of service.
Additionally a lot of the more vocal tech VCs are libertarians bordering on anarcho-capitalism (i.e. free market maximalists who think humanity's survival and progress hinges on a few Great Men rather than the unsophisticated masses). The greater Web3 ecosystem is trying to solve cooperation with people you actively distrust and represents every interaction as a financial transaction. This is extremely appealing to them. Their problem with capitalism isn't that it inevitably leads to a massive wealth disparity (because after all, some people are "just better") but that the government gets in the way. This makes the promise of decentralization (even if it defers to consensus between the already wealthy) ideologically appealing to them.
Based on my conversations with web3 believers, they would generally agree with most of what I said but object to the language I'm using because it doesn't sound very flattering.
regarding "free market maximalists who think humanity's survival and progress hinges on a few Great Men rather than the unsophisticated masses" -
Libertarianism may have changed in character, or perhaps more in how it is characterized in media, but it used to be that libertarians believed in lots of little people acting freely and that states and the large corporations they are mutually supported by are the opposite of what they want.
Hopefully it is because the little people have largely left the relatively pointless large media spaces online and does not represent a genuine change in how the majority of libertarians, who used to not be terribly wealthy if they were wealthy at all, think.
Even deeper question. Why does "web3" need to make money? Wouldn't it be better to go hobbyist providing services? Or everyone running their own things at their own cost, marginal let's say 10 or 100 a year? Like true decentralization, that isn't burden to profit...
Because incentives. The beauty of crypto/web3 is to reward the service providers with incentives for their services. Nobody is going to provide things for free and even if they do it won't be sustainable in the long run.
Gatekeeping access to (edit: online, but I suppose this could also apply to offline) resources based on digitally verifiable ownership and the subsequent rent-seeking is a capitalist wet dream. I'm not the least bit surprised the VCs are slavering over web3.
There's no reason why a business trying to use "web3" wouldn't need to raise a round. Every business that wants to grow more quickly than the founders can manage alone needs some sort of capital to pay people to help. One way to do that is by giving up a bit of equity in return for money.
That sounds a lot like, you know, web 2.0. Let's scheme this out: Facebook (and its corporate policies) is often named a motivating factor for web3. If I wanted to make a web3 replacement (let's call it MastoCoin), how would the economics of that actually work? People would still want to upload lots of posts and pictures and stuff, and that would presumably continue to live on S3 (etc.). Somebody needs to pay the bills for that monthly. So even if I had to pay $3 bucks in gas to post my sarcastic tweet, someone else would incur an indefinite expenditure on it, no? I really cannot think of a non-pyramid model here.
VC funding is needed to raise funds for software engineers and provide access to mentorship and community, like every other software company that uses VC funding. You can raise funds through other means (bootstrapping, ICOs, etc) but these have their own sets of downsides.
What makes you think it needs it? If every person in the world shilled something they called Web3 that wouldn't change the conclusion of this blog post? What are you on about, exactly?
People sometimes claim that there's a generational divide in crypto adoption — younger people "get it" while older people (those who came of age with the early web) are stuck in their ways.
But there’s a large group of older people who cling to crypto because they think it'll make their ideas sound relevant again. While appearing "disruptive", the crypto space actually privileges those (generally older) folks who already have money to burn (like the Winklevoss twins, whose payout from FB provided more money than they could ever spend on themselves in one lifetime).
What I'm trying to figure out about blockchain in general is how people think it will avoid the inevitable consolidation that efficient economies drive towards. A few examples:
- In the early days of the automobile there were hundreds of car companies. Now there are essentially what, 10 worldwide?
- In the early days of personal computing there were hundreds of competing platforms, PC brands, etc. Now there are essentially what, 10 worldwide?
- In the early days of the internet there were hundreds (thousands?) of dial-up and last mile internet providers (sometimes literally some person in your neighborhood with a T1 and modems in a garage). Now there are what, 10 in the US?
- In the early days of the internet there were hundreds of web hosting companies, e-mail providers, etc. Now almost all of the internet runs on what, three?
These examples go on and on (mobile devices, cell providers, pretty much anything and everything).
Point being it's extremely unlikely (to me) that as the immutable blockchain ledgers all of this is built on grow endlessly (storage, compute, bandwidth, etc) and attempt to scale to any meaningful application, transaction rate, etc beyond the toy level it's at now "decentralized" will almost certainly turn into a handful of power players that can bring the advantages offered by massive economies of scale.
I don't agree with some of your examples but setting that aside, all of what you mentioned are economic products and services. Crypto is neither. Without crypto you have cash, credit card, debit card, prepaid card, gift card, paypal, ecash, applepay, western union, money gram, epay and a myriad of other non-crypto payment methods that are based on central bank currency. They did not consolidate. Or look at currencies in general, every country has one by design.
Also decentralized does not mean that there are no hubs where decisins and power is concentrated, it simply means there is no one center. Much like how people say the US is democratic because you have two parties to choose from instead of just one like China. I do think perect decentalization is egalitarian in that all important decisions are 51% majority consensus with every vote having equal weight. However most practical decentralized systems are distributed with the capacity to be fully decentralized.
Crypto currencies that will last long term will reflect a demand for specific payment needs. To use your example, we have lesser number of PC makers because they all make similar varieties of PCs. With payment systems you have ACH,SWIFT,card payment (instant), cash (anonymous),etc... there will be cryptocurrencies that will reflect popular payment and speculative investment needs for the long term.
I'm aware I'm talking very broadly and generally about the "majority" and in many cases "overwhelming majority" of these cases. I know some of my examples are hyperbolic and a little "loose". I've been meaning to research and document actual numbers and examples to either validate or invalidate my take. Now that I'm really thinking about it because of your thoughtful reply I just might!
That said I think banking and payments are further examples. The vast, vast majority of banking and payment activity happens through a relatively tiny number of banks and payment processing networks. The US dollar is used officially and unofficially in many other countries. Europe went to the Euro. As I understand it much of worldwide settlement internationally happens in the US dollar which is also more-or-less the official worldwide reserve currency.
Bitcoin currently does about 500k transactions/day worldwide (as best as I can tell). That's probably roughly the number of daily transactions for a mid-sized US city. At a future point in time where a significant number of people are transacting in cryptocurrency multiple times per day an immutable blockchain ledger with no upper bound on growth will swell to astronomical size when a significant number of people are transacting with it multiple times per day.
Now your $3 Starbucks purchase is recorded for eternity and replicated across hundreds or thousands of nodes?
I'm not a web3 evangelist but I feel the need to say, all of these examples are the result of incentives. Dig into "theory of the firm" it is a very poorly yet somewhat understood set of principles. If you can construct a system with incentives that make consolidation more costly you can by and large prevent it where you want to prevent it. Of course, there are still things that are more efficient after consolidation, there are things you wouldn't want to disincentivize consolidation in, and carefully designing incentives is a lot like preventing security exploits: you have to think of everything to prevent an unwanted outcome, but all you have to do is miss one thing and you get unwanted outcomes.
Readit News
But the thing that really seems weird is that all you need to do make it interesting is 1) define what you mean by web3 (it’s a slippery weasel word that changes meaning whenever the people using it needs it to) 2) define a few uses that are obviously better than the alternatives and justify them without hand waving (including explaining why what would appear to be fundamental show stopping flaws are not in fact that)
If you can’t do that (and no one seems to be able to) the maybe, just maybe, it is bullshit?
You can choose your social network - if you don't like it, create one.
You can choose where to store your data - if you don't like it, move it.
You can choose where to host your website - if you don't like it, you have options...
etc.
Web 3 is also based on an economy of popularity and/or financial backing to either increase value or disparage an asset, which makes manipulation rampant, and it also makes the "Web 3 economy" inherently corrupt. Frankly, it's not a movement, it's really to me just a mutation of MLM and pyramid-scheme marketing online.
Sorry to be so harsh, but the way it's being spammed at all of us every day, and infecting real online commerce is abhorrent, and growing to the point where not much can be trusted when Web 3 is mentioned for me.
If you look how people interact with the web, it’s highly centralized to a handful of apps by a handful of companies.
I can understand web4 could be self financing unstoppable web resources with no central authority able to close them but I dont see yet a proper use case beyond criminal endeavour. Plus, we're far from it, we'd need an organic transmission network that goes out of the traditional ISP system, like a global bluetooth peer to peer mobile network every phone contributes to in exchange for payment... that would be fast enough...
Unclear if the value prop is large enough to overcome the activation energy of such an endeavor.
As you can imagine, the latter activity is criminal in Russia and Belarus.
People like pointing out echo chambers all around while they are also in one.
Remember all the feathers ruffled with cloud computing? It just servers in a data center! Serverless? There are still servers! web2.0 s just ajax requests!
If people dump money into it, then something is likely to come out whether is better or not than what it was before. Maybe is worse, or maybe something will be built on top of it that will be better or some othere political event might make it relevant. Who knows
Now “crypto” is a little different because the the promise (not always followed though on, it’s still negative sum) of money to anyone who can bring themselves to believe. Like many bubbles and ponzi-like schemes before it’s primary functionally is to promote itself, and damn that’s one of the few things it’s really good at.
They really didn't. In my 20+ year tech career I have never seen any new technology prove anywhere near as divisive as web3/crypto.
Unlike the crypto ecosystem, those offered a tradeoff of higher cost and less control for greater convenience and ease of management. Which was hugely successful.
They're also not ... hegemonizing? in the way that cryptocurrency seems to be advocated.
Think of having a Facebook-like social graph, not controlled by Facebook. Or a merchant aggregation system like Amazon's without Amazon. A system not driven by maximizing exposure monetization (via ads, paid placement, etc.) but by something like a Nash equilibrium that maximizes value creation for participants.
This is what I work on, and I think it can be done.
The entire argument rests upon this premise and the author doesn’t explain it one bit.
If I tell you that web4 is all about complete freedom and an end to world hunger and it’s based on cow farts is it up to you to prove that it’s BS? (It’s early days for cow farts, you can’t judge them o what they can do right now)
What will your opinion be of web3 should the number start to continually go down?
The general historical trend is to make money more abstract and to be able to perform more complicated functions with it. But fundamentally money is a social technology that consists of three things: An abstract unit of value in which money is denominated, a system of accounts, which keeps track of the individuals' or the institutions' credit or debt balances as they engage in trade with one another and the possibility that the original creditor in a relationship can transfer their debtor's obligation to a third party in settlement of some unrelated debt. [0]
Crypto seems to satisfy the essence of that in a pretty cool way. DeFi projects are experimenting with the question of, "can we build the financial instruments and capabilities that a complex economy require on top of, and directly integrated with, this type of monetary system.
Like any technology that requires a large network of users to be valuable it has a difficult bootstrapping problem. But it seems to be gradually working its way to larger and more important transactional contexts. First with illegal digital marketplaces and now in countries with weak monetary system like El Salvador (and with unbridled speculation along the way).
Maybe all of the current crypto projects will fail but it will be interesting to see the nature of monetary systems in 10, 20 and 50 years from now. What aspects of these current experiments have been adopted?
[0] Money: The Unauthorized Biography
Has the author ever heard of OpenStreetMap, Wikipedia, or a million other projects like them? I'm also not quite sure "permissionless data" is how I'd describe a database that stores tiny amounts of data at a massive cost. Pay-to-play is permissionless iif you have the money.
Sometimes the cure is worse than the disease.
Nobody wants a truly distributed org because it is impossible for anything to get done, just as nobody actually wants to use a distributed currency because the costs outweigh the benefits, and the web we have is distributed enough, though of course it has flaws and is in some ways too centralised now, but I don't see how web3 as currently sold helps to solve that.
The biggest problems currently are around identity (SSO), and microtransactions, but neither of those are solved well by existing cryptocurrency solutions or things like NFTs.
True! However I trust the wikimedia foundation, and the fact that because it is a valuable dataset there are many copies of it. If they really did restrict access, anyone could spin up their mirror.
Most of the decentralisation arguments seem to rely on some fetishistically absolute version of the world where you cannot trust any single person or entity, and crypto/web3 is the only reasonable solution if that is true. I, however, have more faith in other people, and am fine placing trust—to varying degrees—in others.
Untrue. You can download the entire database now, and there are many clones.
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Bitcoin has been around for 12 years, but in real life I don't know anyone who has ever used something crypto related for anything else than risky investment, or basically gambling. I'm very skeptical.
However, I have participated in a multisig that controls six figures of funds with a handful of strangers on the internet. I have used my governance tokens to vote on DAO proposals regarding new product lines and features. I have created and sold NFT artwork. I have registered a domain name and set an immutable record on a smart contract linking to a website and an Ethereum wallet. I have used it for logging in to software. I've built software that gates access based on ownership of a particular NFT. I've stored data on Filecoin and archived it on Arweave. I've borrowed money on-chain. I've commissioned artwork and paid in ETH. I've bought gold with Bitcoin. I've helped raise a million dollars for charity with a major celebrity. I've contributed to Gitcoin grants for public goods software funding. Your skepticism just closes your mind and blinds you to what's possible.
Before the spreadsheet it was extremely difficult to do arithmetic at scale. After the spreadsheet it was much, much quicker.
What's the killer feature that cannot be replicated easily without crypto?
Pretty bold stuff! Thought people had generally accepted DAO's and NFT's as likely scams.
Do you want to actually share the URL's for these things? Shit, does web 3.0 even use proper URL's? Where is this magic land of highly democratized services? And why isn't a URL, perhaps the most fundamental tenet of the "web", _ever_ shared in these discussions?
Perhaps it would illuminate the fact that this stuff is all highly centralized already? With most services requiring personally identifying information in order to use them? Wonder what that's needed for...
The worst part of this is that I feel like I could get dragged into this. That at some point I'll have no choice but to start digging into this and dedicate time to other stacks because the money behind Web3 succeeds in shoving it down everyone's throats.
This is someone talking about technology fixing problems, but ignoring the messy real world. For example, we have repeatedly seen how governments can control things which "nobody owns."
Another item which stood out was the idea of Web3 taking back control from the big tech companies. But if they are monopolies, then shouldn't it be the government which takes them down?
Someone suggested it is because they have invested heavily in ETH mining.
Web3 is just the latest excuse to keep the game of musical chairs going and preserve the chimera of use-value for cryptocurrencies since very few people want to use them to actually transact.
https://cointelegraph.com/news/eth2-devs-put-out-call-to-com...
As to why VCs would invest in it: it's currently dodging most regulations that apply to financial transactions (money laundering, pyramid schemes, pump & dump schemes, etc) much like loot boxes dodge most gambling regulations (and it turns out selling gambling to kids is extremely profitable). This makes the market uniquely profitable to invest in right now with promises of extreme ROI as long as it remains unregulated.
"Humanitarian" campaigns to normalize tracking public records and qualifications on the blockchain in technologically underdeveloped countries also produce a high amount of technological lock-in while increasing the capabilities of automated decision making on the blockchain without having to bother with externalities. For example, if one's ability to use an NFT on social media hinges on demonstrating ownership of that NFT, copyright law becomes a tangential consideration much like systems like ContentID make it harder to claim fair use rights because the ContentID claim is not based in copyright law but in the terms of service.
Additionally a lot of the more vocal tech VCs are libertarians bordering on anarcho-capitalism (i.e. free market maximalists who think humanity's survival and progress hinges on a few Great Men rather than the unsophisticated masses). The greater Web3 ecosystem is trying to solve cooperation with people you actively distrust and represents every interaction as a financial transaction. This is extremely appealing to them. Their problem with capitalism isn't that it inevitably leads to a massive wealth disparity (because after all, some people are "just better") but that the government gets in the way. This makes the promise of decentralization (even if it defers to consensus between the already wealthy) ideologically appealing to them.
Based on my conversations with web3 believers, they would generally agree with most of what I said but object to the language I'm using because it doesn't sound very flattering.
Libertarianism may have changed in character, or perhaps more in how it is characterized in media, but it used to be that libertarians believed in lots of little people acting freely and that states and the large corporations they are mutually supported by are the opposite of what they want.
Hopefully it is because the little people have largely left the relatively pointless large media spaces online and does not represent a genuine change in how the majority of libertarians, who used to not be terribly wealthy if they were wealthy at all, think.
There's no reason why a business trying to use "web3" wouldn't need to raise a round. Every business that wants to grow more quickly than the founders can manage alone needs some sort of capital to pay people to help. One way to do that is by giving up a bit of equity in return for money.
VCs own ETH from the presale not from investing in mining.
But there’s a large group of older people who cling to crypto because they think it'll make their ideas sound relevant again. While appearing "disruptive", the crypto space actually privileges those (generally older) folks who already have money to burn (like the Winklevoss twins, whose payout from FB provided more money than they could ever spend on themselves in one lifetime).
Relatively young, not at all into crypto, due to environmental reasons
- In the early days of the automobile there were hundreds of car companies. Now there are essentially what, 10 worldwide?
- In the early days of personal computing there were hundreds of competing platforms, PC brands, etc. Now there are essentially what, 10 worldwide?
- In the early days of the internet there were hundreds (thousands?) of dial-up and last mile internet providers (sometimes literally some person in your neighborhood with a T1 and modems in a garage). Now there are what, 10 in the US?
- In the early days of the internet there were hundreds of web hosting companies, e-mail providers, etc. Now almost all of the internet runs on what, three?
These examples go on and on (mobile devices, cell providers, pretty much anything and everything).
Point being it's extremely unlikely (to me) that as the immutable blockchain ledgers all of this is built on grow endlessly (storage, compute, bandwidth, etc) and attempt to scale to any meaningful application, transaction rate, etc beyond the toy level it's at now "decentralized" will almost certainly turn into a handful of power players that can bring the advantages offered by massive economies of scale.
Also decentralized does not mean that there are no hubs where decisins and power is concentrated, it simply means there is no one center. Much like how people say the US is democratic because you have two parties to choose from instead of just one like China. I do think perect decentalization is egalitarian in that all important decisions are 51% majority consensus with every vote having equal weight. However most practical decentralized systems are distributed with the capacity to be fully decentralized.
Crypto currencies that will last long term will reflect a demand for specific payment needs. To use your example, we have lesser number of PC makers because they all make similar varieties of PCs. With payment systems you have ACH,SWIFT,card payment (instant), cash (anonymous),etc... there will be cryptocurrencies that will reflect popular payment and speculative investment needs for the long term.
Heck, I would even speculate in a crypto lottery!
That said I think banking and payments are further examples. The vast, vast majority of banking and payment activity happens through a relatively tiny number of banks and payment processing networks. The US dollar is used officially and unofficially in many other countries. Europe went to the Euro. As I understand it much of worldwide settlement internationally happens in the US dollar which is also more-or-less the official worldwide reserve currency.
Bitcoin currently does about 500k transactions/day worldwide (as best as I can tell). That's probably roughly the number of daily transactions for a mid-sized US city. At a future point in time where a significant number of people are transacting in cryptocurrency multiple times per day an immutable blockchain ledger with no upper bound on growth will swell to astronomical size when a significant number of people are transacting with it multiple times per day.
Now your $3 Starbucks purchase is recorded for eternity and replicated across hundreds or thousands of nodes?