Web 3.0 can fix the attention-driven digital economy – TechCrunch

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From the imbalanced economy of creators and insufficient security, to centralized control and disgruntled communities, the flaws of Web 2.0 have been fully exposed in recent months.

First, former Facebook product manager Frances Haugen told Congress last month that the social media giant “prioritizes profits over safety.” Then, just like at the right time, Facebook’s centralized services broke down around the world. The outage was so widespread that Facebook couldn’t even access the servers itself.

Next, a disgruntled anonymous hacker posted a huge amount of internal data from Twitch, the popular streaming service owned by Amazon. Along with source code and payout information for top creators, the hacker called for improvements, calling the community a “disgusting toxic sump” in an effort to “foster more disruption and competition in the streaming space. online video ”.

It has never been so obvious that the old guard got a lot wrong despite the growth, reach and profitability of these platforms. The centralized version of Web 2.0, which was all about network effects, massive scale and winner’s economy, no longer works for society.

It’s time to make a change. As Web 3.0 entrepreneurs who are building an open infrastructure that fosters a more collaborative, creative, and user-centric Internet, it is up to us to address the fundamental flaws of the latest generation of technology.

Here’s how Web 3.0 solves some of the most pressing issues in our digital economy today.

Poor security and data control

Twitch continues to be plagued by pranks, like this one, which replaced backgrounds with photos of Jeff Bezos, the billionaire founder of Amazon. Apparently, these security concerns were rampant, as former employees reported poor security practices at the streaming giant.

We have all realized that all the data we share with a centralized entity is at risk. Years of private information leaks from banks, retailers, and social platforms show that you shouldn’t expect anything on the internet to stay truly private.

Since Web 3.0 is built on cryptographic primitives and often features open source code, anyone can contribute to the project by reviewing the code. This enhances user safety and turns transparency into a competitive advantage. The gains are not just based on privacy, but actually result in protecting the value of the user. Security researcher @samczsun has identified potential exploits in protocols like 0x, Livepeer, Kyber, Nexus Mutual, Aragon, Curve and more, saving billions of dollars in potentially lost value.

Interoperable standards mean that ERC-721-based NFTs can be traded and viewed across a litany of different front-end applications, and ERC-20 tokens can access an entire ecosystem of competitive financial products vying for attention and value. . This agency raises the stakes for platforms, which can trigger an exodus of users after security breaches.

Toxicity and responsibility of the platform

The Twitch hackers, although they acted illegally and immorally, were right about one thing: Streaming platforms are increasingly toxic, and big tech companies have struggled to respond in a way. which answers the enormity of the problem. Yet in the world of Web 2.0, streamers have no viable alternatives. They could switch to YouTube or Facebook Live, but they would trade one toxic attention-saving platform for another.

These realities exist in an environment where creators have more power than ever. Fans will follow their favorite creators on whatever platform they choose, giving them huge leverage. To escape toxicity, creators need Web 3.0 tools to get out of walled gardens and control their destiny through direct relationships with their communities.

Web 3.0 also rebalances the power dynamics between users and platforms, giving users control over their data. With the interoperability and portability provided by data management platforms such as Spruce, Web 3.0 platforms can allow users to ‘vote with their feet’ and more easily switch between platforms. form to another.

As companies like Conflux and Moralis facilitate scalability between blockchains and standards, competitors can act quickly whenever an opportunity presents itself. For example, when users discovered that the NFT OpenSea trading platform could be insider trading based on the knowledge of the NFTs that would be presented, alternative platforms such as Artion emerged to rectify some of the grievances. received from the NFT market. Such rapid reactions to market dynamics simply don’t exist in the traditional Web 2.0 ecosystem, which relies on scale and closed access to stifle new entrants.

However, Web 3.0 goes far beyond direct relationships with users. These platforms are owned by users and run by the community, so incentives are aligned for communities to moderate themselves. In the case of video streaming, certainly no community wants hate raids to force their esteemed members elsewhere.

In the world of Web 2.0, users have to wait for the platform to act. In the world of Web 3.0, they can act through built-in governance and moderation mechanisms. On the Mirror blogging platform, users vote weekly for who can write and post. On the Web 3.0 index, the listed projects control the addition and deletion of subsequent projects, ensuring healthy ecosystem growth.

Facebook’s whistleblower also revealed that Facebook has a two-tiered court system, which treats celebrities differently from ordinary users. While a regular account can be penalized for violating the terms of service, an account with many subscribers could get away with the same behavior.

Web 3.0 also fixes this with greater transparency and resistance to censorship thanks to the immutability of the blockchain. Decisions are made in the open through tools like Snapshot and are driven by the community at large. Governance is done in a chain, for all to see. There are no behind-the-scenes deals or two-tier justice systems (unless they’re voted on, of course). Everything is community-driven, so participants can just move on if they don’t agree with the direction or the level of transparency.

An unbalanced designer economy

The Twitch leak revealed a big disparity between the economy of the top performers and the everyday creator. This dynamic aligns the incentives between the platform and only some of its creators. When a few creators make the most money, the platform will draw attention to the most important influencers.

The Web 3.0 paradigm resolves these misaligned incentives by democratizing access and breaking down silos between creators and fans. Web 3.0 monetization mechanisms for creators, like DTV, digital payments, tokens, and crowdfunding, level the playing field in a creator-friendly way. Artists using platforms like glass.xyz have found that they can monetize their content through NFTs along with an engaging live stream much better than they can by simply selling through a Web 2.0 model.

In Web 3.0, users can also own their platforms, often coordinated by tokens. As they directly benefit from the growth of platforms, they are incentivized to provide critical services like moderation, for example.

Users can also purchase Fan Tokens, engage more with their favorite creators, and create a positive feedback loop that nurtures healthy fan communities built around a shared passion. Platforms like Rally, Socios (built on Chiliz) and Roll give creators the tools to directly monetize their reputation, authority and creativity without intermediaries. This further aligns the incentives, as the creator is the platform. The creator can set the rules of engagement and do what needs to be done to maintain a healthy community, without interference from a disinterested third party.

An Internet upgrade is good for society

Without a doubt, it is damaging to have so much social fabric and economic structures dependent on infrastructures controlled by a few private companies. The damage is further compounded when these companies avoid accountability, offering promises of change that seem to fall apart once the focus wears off.

But it’s less about doing away with Web 2.0 altogether and more about giving society that much-needed Internet upgrade. Web 2.0 tools themselves have a huge positive impact, but there are also trade-offs: The structural incentives of Web 2.0 have led to irresponsible and inflexible Big Tech monopolies. Web 3.0 is evolving the Internet to take the good of its predecessor and improve it by aligning economics and incentives among all users – and thus avoid the negative effects of ad-supported models.

In terms of culture and control, decentralized services have a significant advantage over centralized controllers. Web 3.0 offers a whole new way to nurture the community, allowing users to benefit from data portability and interoperability, and refocus the incentives that support self-moderation communities.

Haugen is right: “It’s not about breaking Facebook. The way forward is based on transparency and governance. We all deserve better, and services, platforms and products that emphasize transparency and community governance will be the ones that thrive in the next era of the digital economy.

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