So You Heard of Web 3 But What Is The End Game... The Keys To Finding Your Role In Web3
It's been a while since we last spoke, and in this time I've been doing some deep reflection on the entire existence of the web3 space. What is the end game? The deeper I go the clearer it becomes that the term Web 3 is such a vague term for what is included in this ecosystem.
My thesis on cryptocurrency and the web3 space has shifted tremendously, and the recent news from?#Coinbase?building their own layer 2 blockchain without a token has confirmed my sentiment and is unveiling the various roles within this ecosystem.
For those who are still unaware of what this means for the development of the web3 space, I'd like to introduce you to the #cryptostack.
Within the crypto stack, there are 8 sectors within the iceberg of #web3
Here is an in depth guide into the crypto stack and what each
Cryptocurrencies
Cryptocurrencies are simply "private money" this was a trend that occurred in the 1800s and early 1900s in the US at the time when there wasn't enough Fiat in circulation to allow for commerce to occur.
Cryptocurrencies are just a digital rendition of this concept it is meant to represent either digital cash or digital commodities
Just because something has a token doesn't mean it's a cryptocurrency, this is a lazy oversimplification of how it functions within the real world. Most tokens are unregistered securities as they are illegal "private money".
A lot of people are speed-running history now and finally realizing why concepts like?#privatemoney?mostly died out.
Most cryptocurrencies are absolutely going to get shut down in my opinion it's just about which ones at this point only #Bitcoin,?#Litecoin,?#Monero?#Zcash,?#DASH?and yes even?#Dogecoin?will likely survive the purge.
Smart Contract Platforms
Ethereum is the premiere smart contract platform with competition from the likes of?#Solana,?#Cardano,?#Alogrand,?#Stellar, #Tezos
The rest of the other functions within the crypto stack are essentially tech stocks and you can contribute to the ecosystem in a variety of ways it's essentially an open-source business. These are here to stay and people will continue to innovate in these sectors of the stack.These networks enable builders to create the other functions within the crypto stack
A smart contract platform is a base blockchain with built-in general-purpose?programmability that allows developers to write smart contracts and launch?decentralized applications (dApps). These platforms can also function as a?data availability layer, where all transactions are ultimately settled (hence why?they’re also called settlement blockchains).
While the term “distributed ledger” is used to describe blockchains like the?Bitcoin blockchain, whose specific purpose is to transfer value such as money smart contract platforms such as Ethereum are more accurately described as?“distributed state machines.”
This is because the data structure of these chains holds not only all accounts and balances but a “machine state,” which changes from block to block according to a predefined set of rules. In turn, these rules are defined and executed by a virtual machine, making it more efficient to create smart contracts for other functions on these open sourced platforms
App Specific Blockchains
App-specific blockchains are standalone blockchains built to serve specific?
use cases, such as cloud storage and IoT devices, or social media content. Instead of creating a? decentralized application on top of a smart contract platform like Ethereum,?developers build their own customized blockchain from the ground up to?operate a single application.
Oracles
The core of what oracles are is to act as a middleware solution to bring off-chain data directly to blockchains such as traditional APIs for example, this can be incorporating traditional asset price feeds or the weather. A shortcoming of blockchain?protocols is that they are isolated from the world outside their ledger, which?reduces the utility of a smart contract platform. This circumstance is known?as the oracle problem. The most prominent in this space are #Chainlink, #UMA.
The potential for these is endless as many the groundwork is being laid for simplifying porting off-chain information to the blockchain. web3 applications have the freedom to integrate in many other formats yet to be explored.
cApps (Centralized Apps)
Don't be confused, cApps are simply just the end products and services in the crypto economy.?Just like the normal apps we used today such as LinkedIn this is a cApp as well. #cApps are traditional software applications that allow users to interact with the crypto-economy.
Centralized web and mobile applications to access Web 3 products and?
领英推荐
services - cApps are operated by traditional organizational structures (private and public companies, foundations, etc.). cApps have at least one of the?
following characteristics:
Some examples of this include #Coinbase, #Binance, #OpenSea, #MagicEden & #Zora
dApps (Decentralized Apps)
dApps refer to web and mobile applications to access Web 3 products,?services, or data. We also consider Decentralized Autonomous Organizations?(DAOs) as a structure for dApps, as their use case is typically to organize?communities towards a common goal through blockchain technologies.?Many dApps are also run and managed by Decentralized Autonomous Organizations (DAOs), or simply put, flat structure organizations.
But, what's the point of this? dApps are the end products and services, similar to apps built on an app store, except dApps are permissionless and censorship-resistant. DAOs, in turn, are the structure for crypto-native businesses that track terms on chain.
dApps are like traditional software applications, but they live on a decentralized Smart Contract Platform, which allows users to encode rules of any transaction in a trustless manner and create scarce digital assets with specific functionalities.
Interoperability Protocols
These protocols are simply networks that specialized in inter-blockchain connectivity allow chains to?communicate with each other by transmitting states or messages. These?networks come in cross-chain bridge networks or hub-and-spoke models?where hubs connect spokes of application-specific blockchains.
Essentially they are like a coalition for supply chain shipping routes for blockchain or even consider them as the WhatsApp of value transfer, where any device, whether it is iOS or android can communicate in one environment. in this case, any blockchain, can communicate in one environment. On some interoperability protocols, connected blockchains have shared security, hence the Coalition analogy.
All interoperability protocols are Shipping Routes because they facilitate the transfer of information or value between connected blockchains. Just like cross compatible multi-platform video games as well. Some examples of protocols that enable these is #Cosmos & #Polkadot
Scaling Solutions
A term describing a specific set of scaling solutions for blockchains. At its core, a scaling protocol is a separate blockchain that helps augment the network capacity of a settlement blockchain by orders of magnitude while inheriting the security guarantees of the latter.
Examples include “rollups,” which bundle or ‘roll up’) hundreds of transactions into a single transaction on the base layer, removing congestion in the settlement blockchain.
Scaling protocols operate similar to high rise skyscrapers in the real estate market, think of them of the thing that relieves congestion in the settlement blockchain (“digital nation”) on top of which they are built. Scaling protocols are similar to commercial banks before settling transactions on Fedwire. Why? Transactions are signed and aggregated off the base chain (settlement blockchain), which removes the constraints of fixed block size and block rate, similar to how skyscrapers relieve congestion of low density homes in a city to have more effecient cities. Some examples of these include #Polygon & #Arbitrium.
What does this mean for you?
These are the areas where web3 companies can find product-market fit to solve solutions that benefit from the automation of gateways and access the open nature of verifiable information within a database. Investors alike can make more informed decisions as to what type of web 3 investment they chose to investigate or use in their products and services.
However one thing is for sure, the era of everything requiring a token and their own sidechains is over and I'm excited to see how the web3 world is shaken up by these changes in the next few years
Blockchain isn't frank's red hot sauce you can't put that ?? on everything.
As more players are entering the web3 space, and while you're twiddling your thumbs the opportunities and space are quickly gaining traction. Will you continue to sit on the sidelines or will you take action on what you are planning? The power is in your hands!
My name is Aaron Cole Co-Founder of?Bounce Back Digital?and I'm here to teach you the economics behind FOMO, or what I like to call... FOMONomics
#blockchain?#cryptocurrency?#business?#tech?#money?#automation?#building?#commerce?#legal?#database?#web3 #cryptocurrency #cryptocurrencies
#CoinGecko #internetofthings #internetofthingsiot #tokenomics #tokenization #NFTs #FOMO #finance #fintech
Sources:
JSTOR Daily/Livia Gershon
CoinGecko
21 Shares
Realtor Associate @ Next Trend Realty LLC | HAR REALTOR, IRS Tax Preparer
2 年Thanks for Sharing.