Web3 Needs A Better Marketing Team

Over the past few years, I’ve circled the globe meeting with Web3 and Crypto proponents and innovators in Europe, Asia and North America. My last major event was Token2049 in Singapore last year, a massive conference with over 10000 attendees and 300 exhibitors.  This show, like the others, was buzzing with excitement around this relatively new technology and how it will profoundly change our interactions in the future.   But, outside of the Web3 enthusiasts’ world, I sometimes feel like discussing this topic in a group is like talking to myself.  Web3 is still one of the world’s best (or worst) kept secrets.

The Promise of Web3

At its core, Web3 is a new paradigm for the Internet.  It’s decentralized, open, and user-centric; there will no longer be a need for a Facebook or Google to manage your data or experience.  It is built on blockchain technology, which provides a secure and transparent way to complete transactions (enabling Web3’s arguably only current killer app, Cryptocurrency) and will redefine digital identity, secure data exchange & governance.  If this all sounds complex and a radical departure for what you know today, you’re right.  The reality is that the adoption of new technology takes time.   That would normally be the end of the discussion…unless you realize that Bitcoin (one example of Web3-based cryptocurrency) currently has the world’s seventh highest valuation (USD $1.3 Trillion), more than Meta (Facebook parent company) and Berkshire Hathaway!

Bitcoin Market Cap Above US$1 Trillion (March 2024) - Crypto.com

 And Web3 is already transforming the world in which we live.  For example:

·        Outside of investment and speculation, Web3’s Decentralized Finance (DeFi) platforms are reimagining the Finance industry, enabling peer-to-peer lending and borrowing to those who are unbanked or underbanked without the need for traditional financial intermediaries.   

·        The rise of Non-Fungible Tokens (NFTs) is changing the Arts and Entertainment industry by providing artists and creators with a new model for digital ownership and monetization, disrupting traditional copyright and ownership models.  This innovation is also enabling digital real estate and gaming. 

·        Web3’s Decentralized Autonomous Organizations (DAOs) are profoundly affecting global laws and regulations as DAO’s smart contracts operate without centralized control.  This model is paving the way for democratic governance that is both transparent and inclusive.

 Challenges to Widespread Adoption

Inevitably, after I give the Web3 pitch to neophyte business professionals and potential investors, I’m asked, “Why wouldn’t I dive deeper into this brave, new world?”.  If you have ever bought Cryptocurrency online, you already know part of that answer.  The road to widespread adoption of Web3 technologies is fraught with challenges, veils that shroud the full promise of Web3 from widespread recognition and understanding.   The answers to overcoming these hurdles will involve not only technology but also concerted efforts in education, regulation, and community building.

Technical Complexity and Usability

Web3 is technically complex. For the average user, the concepts of blockchain, smart contracts, decentralized applications (DApps), and cryptocurrencies can be daunting. The user interfaces of many Web3 platforms often assume a level of technical knowledge that most do not possess, making these platforms less accessible to those outside the tech-savvy community.

In addition, the usability of Web3 applications are often NOT the seamless and intuitive experiences we commonly see in our current Web2 experience.  Today’s mainstream users, who are accustomed to the polished interfaces of Facebook, Google, and Amazon, may be deterred by the less than polished common user experience in Web3.

Scalability and Performance

Blockchain networks, in their current state, often struggle with handling high volumes of transactions quickly and cost-effectively.  For example, the Ethereum network, which hosts a significant portion of DApps and DeFi services, has faced significant issues with network congestion, which lead to slower transaction times and higher fees.

These scalability issues not only affect the user experience but also limit the practical utility of blockchain and decentralized technologies for large-scale applications. Until potential solutions (such as layer 2 scaling solutions, sharding, or alternative consensus mechanisms) can be widely implemented and proven at scale, the adoption of Web3 technologies will remain limited.

Regulatory Uncertainty and Compliance

The regulatory landscape for blockchain and cryptocurrency is still evolving, with significant variations across international jurisdictions. This uncertainty can pose a risk to businesses and users in the Web3 space, who may find themselves in a legal grey area or facing sudden regulatory changes that could affect their operations or the value of their assets.

In addition, the decentralized and borderless nature of blockchain makes it challenging to fit Web3 technologies into traditional regulatory frameworks designed for centralized entities. Issues such as consumer protection, privacy, Anti-Money Laundering (AML), and Know Your Customer (KYC) regulations present complex challenges that need to be addressed to facilitate wider adoption of Web3 technologies.

Security Concerns and Risk of Loss

While blockchain technology is renowned for its security and immutability, the ecosystem around Web3 technologies (including wallets, exchanges, and smart contracts) has been vulnerable to hacks and scams. And the irreversible nature of blockchain transactions means that security breaches could cause users to lose substantial sums of money without much recourse. These security incidents erode trust and hinder user adoption.

In addition, the responsibility for security in Web3 often falls on the individual user, who must manage private keys and navigate complex security practices, an intimidating and impractical responsibility to many users…another barrier to adoption.

Cultural and Societal Barriers

Finally, the decentralized ethos of Web3, which emphasizes individual sovereignty and a limited reliance on centralized authorities, represents a significant shift from the current paradigm. For many, the trust in and reliance on centralized institutions are deeply ingrained, making the conceptual leap to decentralization challenging.

Moreover, the speculative nature of the cryptocurrency market, which is often associated with Web3, can overshadow the underlying technological benefits and contribute to a perception of Web3 as risky or volatile. Overcoming these societal apprehensions requires not only technological solutions but also educational efforts to highlight the benefits and potential of Web3 technologies.

 Is Web3 a Popular Recluse?

Today, Web3 is somewhat of a paradox where it is both highly visible and deeply obscure. Cryptocurrencies have captured the public's imagination and dominated media headlines, serving as a gateway to broader discussions around Web3. But, the underlying principles of decentralization, the vast ecosystem of DApps, and the philosophical implications of a user-centric internet is a mystery to the public-at-large.   There is also an investor’s dilemma as potential suitors struggle with the right time to get involved with Web3 properties and capture the greatest return (too soon is a financial risk; too late is a financial miss).   This risk is complicated by the global nature of the Internet and the local nature of laws and regulations.

In essence, Web3 remains the world's best-kept secret not because its concepts are unknown but because its potential and impact are not yet fully understood.  It will take a collective effort of global technical experts, regulators, educators, and users to unveil the secret and bring the promise of Web3 to light.