‘web3 is a solution looking for a problem’

A high-level thread on problems web3 can address

Immutability – the ledger is a permanent, transparent, and unalterable history of all transactions made.

In smart contracts, code is locked and verifiable, enabling autonomous and trustless transactions to be made, and parameters to be respected (i.e capped supply in BTC)

Decentralization – instead of putting our trust in a single company that can control our data, we trust the systems, networks, and algorithmic rules that are distributed, transparent, and open-source.

This enables censorship-resistance, on a global trustless ledger.

Remittances – the $1T market for remittances now has the opportunity to disintermediate middlemen like Western Union or MoneyGram, ridding its users of roughly 20% of their funds.

Users can now send funds anywhere in the world, in mere seconds, for a fraction of the cost.

Access to banking – acc. to Global Findex, 1.7B people remain unbanked today. With web3, anyone is entitled to an on-chain wallet, out of reach of oppressive governments.

With DeFi, they can participate in a transparent financial system that was previously inaccessible.

Democratize work – web3 culture cares about contributions over pedigree. DAOs enable anyone with skills to be onboarded, begin contributing, and get rewarded.

Anonymous personas exemplify web3’s goal to lead with actions rather than credentials, building a reputation over time.

Data ownership – with web3, we’re owners of the system, not its product.

Unlike most web2 platforms where the identity you build stays on that platform to benefit and remain in a walled garden, with protocols like ENS, you can take your assets, data, and identity with you.

Network effects & incentives – In web3, individuals are empowered and incentivized to maintain the system through direct ownership, and are rewarded for participation.

Markets can be created for virtually any asset, and fractionalization enables smaller users to participate.

Communities – Web3 is community-run and owned, building subcultures where anyone can find where they belong.

They span far/wide: developers, artists, journalism, consumer goods, NFTs.. These communities can sprout in an instant, like Ukraine DAO raising $8M in aid within days.

Traceability – With public and transparent ledgers, web3 enables reliable and trusted tracing. Think supply chains, charity operations, and luxury goods, making it difficult for bad actors to cheat the systems.

Trustless, transparent systems build more trust for participants.

Public goods – With web3, developers & users have a much stronger incentive to build public goods because they can directly earn from it while benefitting the community. Examples like @gitcoin and @KlimaDAO come to mind.

Externalities can now be priced and invested into.

Creator economy – in making users owners, creators can now empower their fans in ways that weren’t possible before.

Creators can find better adoption, and develop stronger niches, all the while sharing a portion of the profits with their fans and giving them exclusive access.

That’s it! In the next thread, I’ll be covering web3’s shortcomings. Follow me @0xgaut to get notified when I publish it.

If you enjoyed this, retweet the first tweet so more people can see it, and let me know if I missed anything!