The problems with web3. 🧵
Web3 is imperfect, but there is a vein of defensiveness and maximalism from its proponents that turns off would-be entrants to the space.
If we want to take the technology mainstream and establish a less volatile narrative, we must acknowledge and speak to its shortcomings.
If we want to take the technology mainstream and establish a less volatile narrative, we must acknowledge and speak to its shortcomings.
Does web3 receive unfair criticism? Absolutely. But these dialogues are not zero-sum games.
Let’s be real: It has weaknesses. To onboard people, we must validate and share their concerns—then work on solving them.
There is no room for us vs. them in web3.
Let’s be real: It has weaknesses. To onboard people, we must validate and share their concerns—then work on solving them.
There is no room for us vs. them in web3.
Regulatory
Web3’s greatest existential threat lies in the power of governments to disrupt its proliferation.
For example, China’s recent Bitcoin ban triggered a 2021 bear market.
Regulation isn’t a universally bad thing. It can result in consumer protections. But it is coming.
Web3’s greatest existential threat lies in the power of governments to disrupt its proliferation.
For example, China’s recent Bitcoin ban triggered a 2021 bear market.
Regulation isn’t a universally bad thing. It can result in consumer protections. But it is coming.
Pumping
With $$$ to be made off short-term pumps, we have 1000s of accounts sharing biased info, encouraging others to FOMO in.
What’s worse, many of these are undisclosed paid advertisements.
The result? Distrust. I can’t overemphasize how bad this is for the space.
With $$$ to be made off short-term pumps, we have 1000s of accounts sharing biased info, encouraging others to FOMO in.
What’s worse, many of these are undisclosed paid advertisements.
The result? Distrust. I can’t overemphasize how bad this is for the space.
Lack of Trust Centers
Web2 has a robust ecosystem of developer communities and review sites. From GitHub to Rotten Tomatoes, we mitigate trust gaps with user contributions.
To date, there is no authority for auditing project and token contracts. Getting an airdrop can be scary.
Web2 has a robust ecosystem of developer communities and review sites. From GitHub to Rotten Tomatoes, we mitigate trust gaps with user contributions.
To date, there is no authority for auditing project and token contracts. Getting an airdrop can be scary.
Multi-Chain Confusion
Understanding Ethereum is hard enough. The uncertainty and debate around the future of alt L1s and L2s is necessary, but a barrier to adoption.
Bridging to L2s and managing multiple L1 wallets=pain.
It’s a problem we must persevere and build through.
Understanding Ethereum is hard enough. The uncertainty and debate around the future of alt L1s and L2s is necessary, but a barrier to adoption.
Bridging to L2s and managing multiple L1 wallets=pain.
It’s a problem we must persevere and build through.
Distribution Relies on Web2
To learn about web3, you go to web2—namely Twitter and Discord.
Not enough media lives on web3, because incentives and platforms are not yet strong enough.
Not everything has to be web3—but there will be big unlocks for those that pull it off.
To learn about web3, you go to web2—namely Twitter and Discord.
Not enough media lives on web3, because incentives and platforms are not yet strong enough.
Not everything has to be web3—but there will be big unlocks for those that pull it off.
Bad Actors
We’ve all seen it. People losing thousands to scams, then Twitter makes fun of them.
There’s a steep learning curve to protecting your assets. The result is people opting out, leaving their assets in legacy institutions.
We need better security tools and education.
We’ve all seen it. People losing thousands to scams, then Twitter makes fun of them.
There’s a steep learning curve to protecting your assets. The result is people opting out, leaving their assets in legacy institutions.
We need better security tools and education.
Decentralization Maxis
Not everything needs to be open-source.
Universal decentralization offers network benefits, but can compromise incentive structures. Designing for decentralization is an art.
Web3 promises a more decentralized world—but not an entirely decentralized one.
Not everything needs to be open-source.
Universal decentralization offers network benefits, but can compromise incentive structures. Designing for decentralization is an art.
Web3 promises a more decentralized world—but not an entirely decentralized one.
Developer Shortage
It presents a real problem when there are simply not enough capabilities to build out the incredible ideas the ecosystem is producing. Not only does that shortage lead to premium hiring costs, it stifles the network effects of innovation.
We need more talent.
It presents a real problem when there are simply not enough capabilities to build out the incredible ideas the ecosystem is producing. Not only does that shortage lead to premium hiring costs, it stifles the network effects of innovation.
We need more talent.
Who’s Winning?
So far, the biggest winners have been whales and legacy investment funds. The rich get richer.
However, the question is not whether web3 is a perfect equalizer today, but whether it will ultimately become net better for society.
We must build towards equality.
So far, the biggest winners have been whales and legacy investment funds. The rich get richer.
However, the question is not whether web3 is a perfect equalizer today, but whether it will ultimately become net better for society.
We must build towards equality.
Vague Policy
The SEC and IRS remain vague around crypto tax and securities policies.
This allows us to move with less deterrence, but there will be a reckoning for those that are pushing the limits.
Without clear boundaries, DAOs and token raises remain on shaky ground.
The SEC and IRS remain vague around crypto tax and securities policies.
This allows us to move with less deterrence, but there will be a reckoning for those that are pushing the limits.
Without clear boundaries, DAOs and token raises remain on shaky ground.
Financial Barriers
Blockchains cost money to operate, it’s true. Transactions have to be validated across a distributed network of computers.
And some of those network fees are prohibitive, especially when floods of transactions are bogging down the system.
Blockchains cost money to operate, it’s true. Transactions have to be validated across a distributed network of computers.
And some of those network fees are prohibitive, especially when floods of transactions are bogging down the system.
But we're making progress.
-Emergent low-fee networks: $SOL, $MATIC, $AVAX, $XTZ (many more)
-Increased cross-chain compatibility ($DOT, $ATOM, etc)
-Ongoing Ethereum upgrades to minimize gas fees
Web3 will eventually be supported by an abundance of affordable blockchains.
-Emergent low-fee networks: $SOL, $MATIC, $AVAX, $XTZ (many more)
-Increased cross-chain compatibility ($DOT, $ATOM, etc)
-Ongoing Ethereum upgrades to minimize gas fees
Web3 will eventually be supported by an abundance of affordable blockchains.
Sustainability
Validating the network today costs too much energy, period. But technological revolutions require investment.
If we halted all progress due to energy concerns, we may as well shut down the entire economy—from Apple to Amazon.
Validating the network today costs too much energy, period. But technological revolutions require investment.
If we halted all progress due to energy concerns, we may as well shut down the entire economy—from Apple to Amazon.
Still, we can’t dismiss these concerns. We must make quantifiable progress here, and in fact, we are. Ethereum’s deflationary mechanisms and transition to a proof of stake model, e.g., will significantly reduce consumption.
Every day the technology gets more efficient.
Every day the technology gets more efficient.
Inaccessibility
Accessibility is perhaps the most valid critique of web3.
The learning curve is steep. Developers have not figured out how to mainstream skeptics. There are many obstacles to overcome, and it is early days.
If you don’t admit this, you’re playing yourself.
Accessibility is perhaps the most valid critique of web3.
The learning curve is steep. Developers have not figured out how to mainstream skeptics. There are many obstacles to overcome, and it is early days.
If you don’t admit this, you’re playing yourself.
If more of us can present even-handed information about this ecosystem—without resorting to defensiveness or toxic maximalism—adoption will spread, and we’ll establish a solution-oriented mindset.
Let’s start to look at our “problems” as “symptoms of success.” Let’s build.
Let’s start to look at our “problems” as “symptoms of success.” Let’s build.
Thx for reading and exploring a considerate mindset. Lmk what other barriers we should seek to address.
And follow me @chriscantino for more nuanced takes on the future of web3.
And follow me @chriscantino for more nuanced takes on the future of web3.
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