Decentralised Everything?

Just before Christmas, I was at Unter den Linden 1 at Bertelsmann in Berlin share a little about Blockchain, Crypto and Web3 at the Bertelsmann Tech & Data Week 2021.

I was humbled and honored to be on the same roster of keynote speakers as the excellent?Hannah Fry?(go read her books), and great conversations about publishers, tech, and crypto followed.

This was a global but company internal event, so I won’t be able to share video, pictures or the complete slides, but the following is a general summary - of sorts.

On a personal note, I suspect having travelled straight from the clinic where I'd just witnessed our second child being born and not having slept for over 24 hours to deliver the keynote live on stage I might have come off *a little* disheveled. ;)

Web 1 – Remember? (1990s – ca.2005)

• Semantics all over the place
• Protocols coming and going
• Things breaking
• Things not scaling
• Crowded place, many new unproven players
• Pump & Dump IPOs
• Scams rampant
• Slow mainstream adoption (e.g. e-commerce)
• Value aggregating at the edges (users, developers)
• dotcom crash 2000 - 2001
• “This online web thing will never work…”

(BTW, of course it wasn't called Web1 at the time - only Web3 is that self-referential.)

Fast forward to 2021.

Web 3 – Sounds familiar? (today)

• Semantics all over the place
• Protocols coming and going
• Things breaking
• Things not scaling
• Crowded place, many new unproven players
• Pump & Dump ICOs
• Scams rampant
• Slow mainstream adoption
• Value aggregating at the edges (users, developers)
• ICO winter 2017-2018 (e.g. China's clampdown)
• “This blockchain crypto thing will never work…”

Web3?is the internet that’s being pioneered by?crypto;peer-to-peer networks of computers that talk to each other without middlemen using?blockchain?tech.

Web3 is the new Wild Wild West, the new frontier of the Internet.

As we now know, this Web 1 (and Web 2) thing worked out insanely well for some; Centralised platforms acting as intermediaries - between the creators and their fans, information and people, the businesses and their consumers - made a killing and fortified their positions as de facto monopolies.

For those who made themselves dependant on these centralised platforms –?and then the platforms changed?– it turned out not so great:

Illustration above: How centralised platforms change over time.

Illustration above: Surprise!

TL;DR

• Web1 was about creating value at/for the edges; the developers and users
• Web2 is about creating value for the centralised platforms, the middlemen, the rentseekers, the gatekeepers
• Web3 is a return to creating value at/for the edges; the developers and users – reclaiming independence from centralised platforms
• Web3 is about trust, ownership, and decentralisation
• Crypto & Blockchain enables and empowers trust, ownership, and decentralisation
• Web3 is where the Internet wants to go at the moment
• Yes, there’s an energy consumption issue with crypto relying on “proof of work”, but alternatives exist, Etherium is supposed to switch to “proof of stake”, and PoW miners are “going green” at a faster rate than most "industries", it’s getting better
• Yes, there are problems still with the concept of “decentralised”, e.g. a lot of tech being built on crypto rely on centralised platforms, and crypto platforms have been known to freeze assets and reverse transactions (which arguably should not be possible), we’re not quite there yet today

Conclusion & Recommendations

• It’s 1999 all over again, and the train has left the station, so get in and participate, but don’t bet the barn 1999-style?– you have to ask yourself if you can afford to miss the value creation in the pioneer age (again), and worst case you’ll learn something
• You cannot disrupt the disruptors, don’t try to compete with startups because you’ll lose (they move faster, can break laws, have access to unlimited funding, etc) – acquire, co-operate, or create own initiatives
• Look over your shoulder and around you, who’s [startups] making blockchain / crypto waves near you, reach out and start a relationship – worst case they’ll ignore you, best case you’ll develop new biz opportunities
• Leverage your existing IP and its fan base, it’s something no startup will ever have, think of new ways of monetising and including fans in new ways of participating
• DON’T BLOCKCHAIN EVERYTHING, use trust and ownership as heuristics; if neither is involved, probably skip – also think about internal or b2b processes that could be more efficient or cheaper using blockchain tech
• Look at internal work, internal processes that could possibly be automated using e.g. smart contracts – there’s probably a lot of smart people doing a lot of stupid work that could be freed up by automation (e.g. HR and legal, also see above)
• Traditional publishers should think really hard about how they are going to attract the next superstars, and offering newer generations of artists more tools to monetise their art and let their fans participate in new ways will be a competitive advantage – crypto could be a part of that toolset mix
• Do or do not – there is no try

Further reading:

Peter Yang's great Crypto primer:

https://creatoreconomy.so/p/curious-beginner-guide-to-crypto

Chris Dixon, ex-founder, now VC champion of all things Web3:

https://cdixon.org/

Moxie Marlinspike's (cryptographer & Signal founder) Web3 critique:

https://moxie.org/2022/01/07/web3-first-impressions.html

Vitalik Buterin's (creator of Ethereum) response to Marlinspike:

https://www.reddit.com/r/ethereum/comments/ryk3it/my_first_impressions_of_web3/hrrz15r/