Web3 Consumer Apps: challenging but important
Championing Web3 Mass Adoption
What was the keyword that permeated the Web3 industry in 2023? I can firmly say it was ‘Web3 Mass Adoption’. Last year big scale hackathons occurred every month and the theme of the hackathons was closely related to ‘Web3 Mass Adoption’.
These are the lists that I am aware of. Upon tallying all the hackathons based on various blockchains, it becomes apparent that significant funds have been invested in these events. Then what is the purpose of these hackathons? Actually it is so simply. “Please build on our chain and provide us great service to activate our chain ecosystem, then we will compensate you.” The significant funds poured into hackathons encapsulate this message and it is related to web3 mass adoption. But where does mass adoption come from? Firstly, blockchain is not a service; it’s infrastructure. Infrastructure itself cannot drastically alter our lives overnight. In other words, the progress of infrastructure is merely a partial step towards mass adoption. We can genuinely say that mass adoption is coming only when the advancement of apps is accompanied with advancement of infrastructure.
Advancement of infrastructure and apps should be accompanied
This diagram illustrates the App-Infrastructure Development Cycle, a model initially introduced by Union Square Ventures in their 2018 publication, ‘The Myth of The Infrastructure Phase.’ The article argues that groundbreaking applications have historically inspired and driven the evolution of infrastructure with various examples.
For instance, before the advent of the internet, light bulbs were invented before the existence of the electric grid, and airplanes were invented before the establishment of airports. After the emergence of the internet, messaging apps (1970) and email (1972) appeared first, followed by Ethernet (1973) and TCP/IP (1974), showcasing a pattern that has persisted over time.
In the context of Web3, how can we apply this model? The advent of the BTC in 2008 led to the establishment of the Bitcoin network and Coinbase to exchange this new asset in 2012. The introduction of CryptoKitties in 2017 served as inspiration for NFTs, giving rise to the widely used ERC721 standard for non-fungible tokens.
So, what comes next? I believe that the growth of the next Web3 infrastructure-leading applications will originate in Consumer Apps. I don’t think winner of Consumer Apps has emerged yet. While Uniswap and Compound have been significant driving forces in the DeFi space, they are close with the infrastructure for token trading and also still low accessibility to the average user. Friend.tech has recently led the spotlight on the SocialFi by allowing to trade the value of influencer with keys. However, this was just temporary phenomenon caused by Pradaigm’s investement.
Few key features that web3 apps builders consider about
When we building Web3 Consumer Apps what should we have to focus on to generate new value propositions? Blockchain is inherently inconvenient. If users can have exactly the same experience as in Web2 without the complexities of blockchain, they don’t have reasons to overcome complexity of blockchain based service. Therefore, to reach the general user, technology must be seamlessly integrated into a business model capable of creating new consumer value. Understanding the technical core of blockchain is crucial in this process.
Blockchain technology can have a significant impact in three main areas: 1) Digital Assetization, 2) Borderless Payment Systems, and 3) Digital Identity Verification. Many experts’ opinions converge on these three features, and I strongly resonate with these areas. However, merely applying blockchain technology does not automatically create new business models. The reasons for this are as follows.
Digital Assetization, but Not All Data Holds Value as an Asset
Firstly, the ability to tokenize digital data is a significant advantage for blockchain-based services. Users can leverage the trust established through decentralized networks to tokenize data recorded on the blockchain. A case that encapsulates this feature well is the previously mentioned friend.tech. However, while it is possible to tokenize all digital data, not all data can be an asset. Tokens possess value as an asset when they are financially valued. Therefore, we need to find out the data that possess the value worthy of consumer purchase and integrate it into business model.
Borderless Payment Networks, but Not Every Service Needs to Use this as a Core Feature
Secondly, we have to focus on blockchain is borderless.SWIFT, the most widely used international payment network both historically and currently, is utilized by over 11,000 financial institutions across more than 200 countries worldwide. However, constructing the SWIFT system entails high costs, and various fees such as remittance fees, recipient fees, and intermediary fees must be paid. In contrast, blockchain has the advantage of significantly lower costs by reducing these intermediaries. However, when initially designing consumer apps, we have to be careful not to fall into the trap of blockchain. Because users have to overcome complex payment process — Sign Up Binance → KYC → Buy Tokens → Create Wallet→ Token Transfer to the Wallet → Pay with Crypto. The business model where the payment function becomes the core of the service is limited.
Key of Digital Identity Verification, but the Metaverse Still Has a Long Way to Go
Blockchain is decentralized ledger and it records and stores all data permanently. Digital identity verification based on is a key to connect the real world and the virtual world.
However, as we all know, the metaverse until now was just an illusion. Empty metaverse does not provide a new user experience. Ultimately, entrepreneurs need to explain why their services creating value in the metaverse are more significant.
Conclusion
Today, I shared my thoughts on the mass adoption of Web3 and the evolution of consumer apps. Consumer apps have somewhat been overlooked in the Web3 landscape, as using Web3 services has historically demanded a steep learning curve. However, consumers dose not invest time in learning something new unless it significantly enhances their lives, even it is tagged with Web3. Now is the time to move beyond the perspective of providers and genuinely ponder what services can bring real value and utility to users.
More About SuperSquad!
SuperSquad is money pool challenge platform designed for goal enforcement. It is for anyone struggling to achieve their daily goals. Our mission is to enforce goals and make the process enjoyable.
Official Website : https://supersquad.xyz/
Instagram : https://www.instagram.com/supersquad_challenge/
Twitter : https://twitter.com/Supersquad_xyz
Linkedin : https://www.linkedin.com/company/supersquadchallenge
