The Race for Mainstream Adoption in the Web3 Landscape

Proponents of Bitcoin could argue that their platform is superior for decentralised apps for a wide range of misguided arguments, however seeing the place a lot of the decentralised utility innovation has taken place with tokens, NFTs, DeFi and DAOs, its laborious to counter Ethereum’s place because the main and de-facto platform for a big chunk of the innovation happening in crypto and web3.

The race for mainstream adoption and the rising challengers within the Web3 panorama

Ethereum is not with out its limitations as we have seen with numerous alt-layer one networks rising, and a plethora of layer two scaling options now competing to degree up the capabilities of the Ethereum community. Nonetheless, if one takes into consideration the general dimension of the Ethereum neighborhood primarily based on the entire firms working with and investing in it, it is laborious to see it being displaced. 

A GPT second

When blockchain expertise has its ChatGPT second, we are going to see earlier phases of progress in blockchain expertise pale into insignificance, as a result of sheer quantity of customers that abruptly begin utilizing this expertise. 

This progress is prone to occur on an Ethereum layer 2 community, as that’s the place the community has the flexibility to scale to a a lot bigger quantity of transactions and therefore customers. Nonetheless, it isn’t assured. 

Not like 6 years in the past, we’re now in a spot the place there are many completely different networks competing for customers’ consideration. If one in every of these networks was capable of create a killer use case (I do not like to attract analogies with NFTs or DeFi, as these have primarily been about monetary return for customers), that community might leap forward of the competitors and set up a primary mover benefit. 

Mainstream customers will not care concerning the expertise, they’ll care concerning the ease with which they will do what they need to. 

Nifty Keys

For example, think about there is a undertaking ‘Nifty Keys’ which allows me to mint NFTs that present entry to my home. Identical to home keys, I can situation NFTs to those who want entry to my home together with myself, my spouse, cleaner, nanny for our children, and a neighbour in case of emergencies. 

Not like keys, these NFTs might have extra privileges related to them equivalent to solely permitting our cleaner to entry the property on days they’re resulting from be cleansing, or solely letting our nanny entry the home on college days. 

Subsequent, think about that Nifty Keys turn out to be so ubiquitous that everybody begins phasing out bodily keys as a result of Nifty Keys are a lot simpler to handle. Individuals can use a pockets app on their cellphone which behind the scenes makes use of some variant of the well-known NFT token commonplace. 

These main-stream customers of Nifty Keys are solely going to care about a few issues with their keys — that the consumer expertise is frictionless, it is safe and dependable. There isn’t any purpose why such a expertise has to finish up on Ethereum or an Ethereum community. 

Given the goal marketplace for Nifty Keys are owners with smartphones, you’ve a gargantuan whole addressable market ought to the thought acquire vital traction. These finish customers is not going to care concerning the underlying expertise getting used. Therefore if somebody can create a expertise that sees widespread adoption resulting from its real-world utility utilizing blockchain, it might shift the blockchain panorama considerably have been it to be finished on one of many smaller, much less well-known chains.

Scaling options 

I do not consider that it’ll play out this manner, however it’s definitely doable, and people naysayers who’d labelled Ethereum the MySpace of web3 would have their second of glory. Anyway, the purpose is that one should not low cost the entire alt-layer one applied sciences simply but, these which are positioning themselves as being app-specific chains could nicely be capable to discover worthwhile niches in the long term. 

The good interop debate 

Approaches to interoperability will turn out to be extra related because the app-chain panorama grows. Think about you’ve an asset issuance app chain and a fee app chain. These chains that are inside a selected blockchain ecosystem will be capable to interoperate with out an excessive amount of friction, equivalent to between Optimism Superchains or Polkadot parachains. 

Transferring property between ecosystems will likely be more durable and sure require bridges or corporations keen to shoulder the danger of provisioning and sustaining this infrastructure. Whether or not it may turn out to be as seamless as shifting property between TCP/IP networks is a noble purpose, however maybe too far-fetched given the variety of protocols we have already got. 

Crossing the chasm 

Nobody is aware of when blockchains and web3 will cross the chasm, and supply utility to nearly all of digital residents, that lives as much as its potential that these of us working in web3 want to present. There will likely be monetary plumbing that makes use of it at scale to serve elements of the wholesale monetary markets within the subsequent 3-5 years and we have already got loads of folks utilizing it for monetary functions. However the true utility which gives sovereignty advantages and solves on a regular basis issues for folks might be longer. 

If the expansion of AI is something to go by, we might nonetheless be a 10-20 yr time horizon for it to fulfil its potential, and there’s no assure as to which ecosystem this will likely be on. So it’s worthwhile not being too closed-minded on this entrance and as an alternative targeted on these tasks that can have the longevity of 10-plus years.