Thread by @owocki

I gave a talk today at @trufflesuite #trufflecon about web3 business models.

Thread 👇/1

@trufflesuite The goal of this presentation is to articulate a cartography of the emergent territory of web3 business models. This preso is a mile wide and an inch deep. Its goal is to be a map of this category. /2

@trufflesuite So who cares about web3 business models?

When we started the Business Models Ring in 2017, Ethereum was synonymous with ICOs. Just like Email was just one app, ICOs are just one app on the internet of money.

Biz models are a way for startups + investors to pay their bills. /3

@trufflesuite @gitcoin 's mission is to Grow & Sustain Open Source. We believe that open source has created a ton of value for the world.

Having a sustainable business model is perhaps the ultimate way to sustain Open Source. There is new possibility here in the blockchain space! /4

@trufflesuite @gitcoin First lets talk about web2 business models that'll be ported to web3.

Subscriptions are perhaps the most obvious one in this category. Subscriptions create recurring predictable cash flow, and finance some of the most successful web companies out there. /5

@trufflesuite @gitcoin Ads finance billions of $$$ in web2.

But they externalize a lot of harm; a la privacy violating ad tracking.

I'm really excited to see what happens to ads as data control evolves ( vitalik.ca/general/2019/0… ). Hopefully ethical ads like @codefundio will become prominent! /6

@trufflesuite @gitcoin @codefundio Lastly, I want to talk about taking a fee on a marketplace.

This is another popular model that generates a lot of revenue.
...

@trufflesuite @gitcoin @codefundio But it fundamentally pits the users needs against management/investors. Its an *extractive* business model because mgmt will always need to find ways to ding users with more fees. If uve ever used a banking product and gotten hit with hidden fees, then you know what I mean. /7

@trufflesuite @gitcoin @codefundio Why is blockchain going to enable new business models?

Bc we now have the internet of MONEY! The internet changed every industry that touches information (media, politics, entertainment)

The internet of money will change everything that touches money. Banking, Gambling, Jobs.

@trufflesuite @gitcoin @codefundio Some new properties of the internet of money:
1. Composability -- dApps can be built on dapps
2. Trust-management -- you can trust what you see on the blockchain, and not have to trust an intermediary
3. Theres a cambrian explosion of possiblity in potential in blockchain.

/9

@trufflesuite @gitcoin @codefundio contd
4. Native to the internet -- as opposed to bolted on, like our existing internets payment structure.
5. Censorship-Resistence - deplatforming is much harder in the internet of money.
6. Its Open Source -- Dont 'like what a dApp is doing? fork it and do it better urself
/10

@trufflesuite @gitcoin @codefundio If Blockchain goes mainstream, it will reduce the triangulation, trust, and transfer costs of goods and services.

/11

@trufflesuite @gitcoin @codefundio The first web3-native biz model I want to talk about is ICOs. They held the promise to allow users to become investors in networks & visa versa.

We saw a wave of interest in ICOs in 2017, but its not clear how many projects were going to change the world (much less even launch)

@trufflesuite @gitcoin @codefundio This is part of why Im excited about Continuous Funding Models. Projects can continuously fundraise and balance supply/demand on a bonding curve. Earlier investors will get cheaper tokens (but more risk). As project delivers, more investors buy in, and the price goes up.

/14

@trufflesuite @gitcoin @codefundio Another fun biz model is staking. W the advent of projects like Compound, u can now earn interest on assets that are staked to a smart contract (and the returns are quite good).

This will enable new business models where projects make a return on the interest of escrowed funds.

@trufflesuite @gitcoin @codefundio Non fungible tokens (aka crypto collectables) are another interesting development. @CryptoKitties made this famous in 2017, & there have been many launching over the last several years. @gitcoin has a collectables project, and you can check them out: gitcoin.co/kudos/marketpl…

@trufflesuite @gitcoin @codefundio @CryptoKitties Inflation Funding is another promising business model.

But there's a catch - You need to have token sinks in the form of demand for your token to make this work. If you just inflate the supply of a token with no token sinks, then the price of your token will eventually go to 0.

@trufflesuite @gitcoin @codefundio @CryptoKitties About 5 months ago, @vitalikbuterin floated the idea of micro-transactions as a way of funding wallets and clients. I think it's interesting to think about millions of 1 wei transactions being used to pay a developer's salary. True crowdfunding!

/18

@trufflesuite @gitcoin @codefundio @CryptoKitties @VitalikButerin Lastly, paying with compute resources is an up & coming category.

Proof of Work is one famous algorithm that can turn CPU/GPU power into $$$.

I think it'd be interesting to see projects allow their users to consent to paying with their CPU/GPU time.

/19

@trufflesuite @gitcoin @codefundio @CryptoKitties @VitalikButerin Parting thought: I gave some ex of the possibilities here, but if you REALLY want to understand the full scope of possibilities, learn about the primitives that form the building blocks of these ideas.

Come up with your own assembly of them that could sustain your project!

@trufflesuite @gitcoin @codefundio @CryptoKitties @VitalikButerin Iteration speed matters!

The ETHMagicians Business Models Ring ( bit.ly/web3businessmo… ) is here to help you hypothesize.

Gitcoin is here to help you turn your ideas into code. gitcoin.co

@trufflesuite @gitcoin @codefundio @CryptoKitties @VitalikButerin Thanks for listening & if you want to watch on video, @janpoloy recorded the talk here =>

https://twitter.com/janpoloy/status/1158094332827586560?s=19

🖖live long and prosper!