GM web3 explorers!
Let’s do a quick reality check…
Crypto seems to be burning to the ground.
Company after company is falling into bankruptcy.
And the contagion is spreading like wildfire.
Furthermore, our favorite magic internet monies continue to go in one direction… down 📉
It's quite the contrast to 2020 and 2021, isn’t it?
Back then crypto companies were raising millions with ease, the charts were always green, and we were all on our way to becoming rich!
What a time it was to be alive…
Now we’re all broke and holding bags of shitcoins that used to be worth 100x more than they were today.
Don't even ask about the stupid JPEGs in our wallets we once paid thousands of dollars for 🙈
We can’t even give them away because the tech doesn’t work or they’re stuck on an exchange that no longer exists 🤷
You can’t help but think… is it all over? Were the naysayers right all along?
“Crypto is a scam. Cryptohas no value. Crypto is just a Ponzi scheme.”
My answer to that is…
🤝 Together With Lens: The Evolution of Social Networking 👀
Crypto Might Be Dead, but Web3 Is Thriving!
Web3 is the new sheriff in town and it doesn’t give 2 sh**s about FTX, Celsius, or 3AC.
Web3 isn’t phased by greedy billionaires and finance douchebags over-leveraging and losing billions.
You know what web3 has to say about that?
Just Keep Building #JKB
The best part about it is that web3 is eating the world and no one even knows it.
“But sir, isn’t crypto and web3 the same thing?”
Not at all and here’s why 👇
In the middle of an absolute crypto shitstorm, Nike, one of the biggest brands in the world, launched .SWOOSH. It’s a platform to build “virtual creations” (aka a web3-powered marketplace to buy and sell user-generated NFTs using CRYPTOgraphic wallets and identity built on a CRYPTOgraphic blockchain).
Starbucks launched a new app for their loyalty program using “stamps” (aka a web3-powered marketplace to earn, buy and sell Starbucks NFTs built on top of a CRYPTOgraphic blockchain).
Instagram is allowing users to monetize their content by selling their posts as “digital collectibles” right in their app (aka a web2 frontend that automatically mints NFTs on a CRYPTOgraphic blockchain).
Reddit launched almost 3 million customized avatars that are stored in a user’s vault (in other words they onboarded 3 million people into NFTs that are disguised as JPEGs stored on a CRYPTOgraphic blockchain in a CRYPTOgraphic wallet).
Do you see where I’m going with this?
Web3 has literally never been better than it is today—even though the world around it is burning down.
But this is the point that most people are missing, cryptocurrency and web3 are very different things.
Yes, they are both functions of blockchain technology, and both use cryptography. But in reality, they aspire to achieve very different goals.
Let’s take a quick dive into crypto versus web3 so we can wrap our heads around what the heck is going on in this crazy digital world.
🟣 QUESTION
What's Your Favorite Thing About Web3?
- The emerging technology
- The potential business use cases
- That it gives power back to individuals
- Its "We're all going to make it" vibes
👉 Let us know by replying in the comments with 1, 2, 3, or 4.
Crypto Versus Web3
When most people use the word “crypto” they’re referring to a shortened version of the word “cryptocurrency”, which was the first invention built on top of a blockchain.
Bitcoin (aka the king of crypto) was the first of these new currencies that uses cryptography as its monetary policy rather than a central bank. An incredible invention that started the blockchain revolution (...implosion?) we're in today.
Cryptocurrencies, or you could think of them as “crypto money” are financial instruments that aim to separate money from the state.
The idea of crypto money is to create “sound money”—money that can’t be inflated away by central banks and money that isn’t owned or controlled by any one country or government.
The big idea here is, “If we fix money, we fix the world.”
If governments no longer control their local currency, they’ll have to start behaving. It puts the power back into the hands of the people as governments can no longer print their way out of problems like they do today.
It brings financial equality and opportunity across the world.
Since Bitcoin, many cryptocurrencies have launched, attempting to become the next big “crypto money”. Some have faster transaction speeds and some have cheaper fees while others, quite frankly, are just idiotic meme currencies.
Regardless, up until just a few years ago, that was all the crypto industry had to offer—speculative internet-native currencies which promised to change the world.
When most people refer to crypto being a scam, a Ponzi scheme, or say it has no value, this is what they are referring to. And for the most part, they were correct. Most of those currencies from the early days went to 0.
But they missed the forest for the trees. They missed the true unlock of blockchain technology
Before I go any further, let’s be clear: sound internet money built on a censorship-resistant blockchain is one of the greatest inventions of all time.
I won’t go into any more detail on which sound money I think is the best as that is not the point of this article *COUGH* $ETH *COUGH* ULTRA-SOUND MONEY *COUGH*
Oops sorry, the cold winters of Canada are getting to me 😏
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Meme of the Week
Moving Onto DeFi…
Then we built DeFi (Decentralized Finance).
I’ll keep this part short as it’s only important to clarify what just happened in the industry.
The idea was this:
“If we’re going to have internet-native money that uses cryptography as a monetary policy rather than central banks, we should also create financial services which use cryptography to facilitate those services rather than traditional banks”.
The goal was to remove trusted third parties and custodians at all levels of the money tree.
So we did just that. (And by we, I mean the thousands of extremely smart blockchain developers around the world who are wayyyy smarter than me. I just write and talk about it 🤷)
Uniswap, AAVE, MakerDAO, and many other incredible DeFi applications were built on top of blockchains. They facilitate lending, borrowing, and various other financial services in a permissionless and trustless manner to anyone in the world with access to the internet.
Another incredible invention enabled through blockchain technology… But wait!
Lending, borrowing, crypto—isn’t this the thing that made all of these crypto companies go bankrupt? Isn’t this the reason why my life savings, my 401k, and the money from refinancing my mortgage just went to 0? (...kidding, don't do that!)
This is the part of the story where people tend to get a bit confused.
The answer is no. DeFi is actually thriving right now. These applications are working exactly as planned and have had 0 bankruptcies or bailouts during the recent bear market.
Where things went wrong was in CeFi (Centralized Finance).
A group of finance bros who didn’t quite get the memo on what crypto and DeFi were all about decided to take retail investors' crypto and start lending, borrowing, and leveraging it the traditional way.
The way where we have to trust institutions and humans to do the right thing instead of trusting cryptographic protocols to do the only thing it's programmed to do—not fail.
Unfortunately, most people don’t understand the difference between DeFi and CeFi (or more likely just didn’t care) and willingly handed their crypto to these greedy douchebags to play around with.
Trusting humans and institutions with our money (aka power) is always the problem my friends, and that is why our industry is in the mess it is today.
The FTX implosion—another catastrophic event that is making most people in the world believe that “crypto is once again dead”.
Again, it’s regarding financial instruments and this idea that crypto = money.
But cryptography and blockchain don’t = money.
What cryptography and blockchain really enable is trustless and permissionless digital ownership.
Money is one product of that. But there are so many more…
And that brings us to the party happening right now in web3.
Web3 is Thriving!
If crypto = crypto money (cryptographic money), then web3 = crypto tech (cryptographic technology).
While crypto is focused on fixing money and separating it from the state, web3 is focused on fixing our internet rights and separating our data from big tech companies.
On the internet, data = power. It’s another form of value, like an internet commodity.
Big tech companies own and control our data and thus own and control the power.
The more we use the internet, the more power these companies gain. I’m not even sure that most people realize the size of this problem currently!
Big tech in some instances owns more power than many nation-states themselves. Think about it, Facebook, the largest tech platform online, hosts almost 3 billion users. Meta, its parent company, owns 4 apps that each have more than 1 billion users on it.
Whereas the largest country by population in the world, China, hosts 1.4 billion people.
While we are comparing apples to oranges here, the more we live, work, communicate and do just about everything on these platforms, the bigger our problems become.
But this is where web3 comes to the rescue. We can use blockchain technology to provide trustless and permissionless ownership over our data, just like we can with our money.
Not only does this put the power back into the hands of the users, but it also improves how we use the internet. It creates new ways of online monetization and opens up a Pandora's Box of internet-native businesses and communities.
👉 If you’re not completely familiar with what web3 is then check out this tweet thread or read how Web3 Unlocks New Business Models.
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How is Web3 Weathering The Storm?
Easy.
Web3 is about technology, not speculation.
It’s about creating a better experience for users which includes giving them ownership and sharing value and power with them too.
And most importantly, it’s working!
The biggest brands in the world have all bought in. Nike, Adidas, Budweiser, Visa, FIFA, The NFL, The NBA—the list goes on. They see the value that web3 technology brings to their audiences and they want to be part of it.
Even better, the biggest tech companies in the world have bought in too. They understand that web3 is the future and that their businesses have the most to lose from avoiding adoption.
Rather than reacting as the music industry did with Napster and downloadable music, tech companies today are smarter and are instead embracing technological disruption.
- Google is helping developers and businesses with the web3 tech stack.
- Meta is helping creators turn their content into self-owned content via NFTs.
- Reddit is onboarding millions into accessing web3 wallets.
- And Twitter… well who the hell knows what Elon is up to over there. But it looks like they’re making moves into web3 too.
The point is… everyone’s onboard with web3!
Blockchain technology is accelerating at an exponential rate.
The human and intellectual capital entering this space just continues to grow.
And companies, brands, celebrities and more across every industry possible just continue to experiment and utilize this technology.
Even during the darkest moments of this crypto bear market, the web3 party hasn’t stopped. Interest rates, the money printer, and greedy finance bros don’t impact this party.
The GMs are still flowing 💪
The builders are building 👷♀️
And the party continues 🥳
Crypto may be dead. But web3 is just getting started!
ABOUT THE AUTHOR
Kyle Reidhead
Founder of: Web3 Academy & Impact Digital MarketingFind Kyle: Twitter
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