Thread by @WuCarra

Web3 native business models: a thread🧵

Something @AriannaSimpson taught me is that business models emerge from the unique properties of paradigm shift technologies. The skeuomorphic ones don’t survive. Internet -> affiliate marketing. Streaming -> subscriptions. Cloud gaming -> free to play+microtransactions

@alive_eth taught me that in DeFi & NFTs, at least 1 canonical form has emerged: smart contract -> token incentives -> integration -> user aggregation (what models have I missed here?)

The fact that this path is so long is a result of smart contract composability. At every later in this stack, you can double click and find interesting sub business models (e.g. liquidity provision, oracles) that each leverage the unique properties of the previous smart contract

Part of the reason I believe web3 is inevitable is that markets reward architectures that preserve maximal optionality for future composition (this is why TCP/IP aka the internet we know and love beat centralized networks like the FSN. @cdixon taught me this one ☺️)

Aside: hearing @pmarca & @bhorowitz tell the story of how they fought this battle before I was born was like the reading most epic Sci-fi prequel ever (I’m the tortured protagonist of the sequel obviously because you have to manifest main character energy) wired.com/1997/05/time-w…

Decentralized, permissionless networks maximize optionality and minimize rent seeking while still incentivizing business innovation, which enables significantly longer (and experientially richer) value chains than in web2.

Two areas of web3 where the business models are still emerging are DAOs and crypto games. Crypto gaming involves experimental macroeconomics & probably requires more rigorous context, so I’ll save that for a diff thread. Let’s talk DAOs :)

I want to hear from you— what are the unique properties of DAOs that will form the basis for emerging business models? Are there any models you’re seeing work for DAOs today that you think will become canonical?