Following our last two posts (Thick Clients, Thin Servers and Thick Clients, No Servers) exploring Web3, really what we are trying to understand is the broad macro-trend for which blockchains are a part. What is the story that can cut through to the public and explain what is happening, why it is essential, and why it will change their lives? The story for Bitcoin is compelling and straightforward. Money not controlled by central banks. For millions of people around the world, this matters. Over the past ten years, the narratives around Bitcoin have changed, and different factions are using the technology to tell different stories: digital gold; an uncensorable payment network; a tool for financial inclusion.
But for a lot of people, the current financial system works pretty well. They get paid, buy stuff with a debit or credit card, take out a loan, and maybe at a push, buy a property or some stocks. For these people, Bitcoin or any other cryptocurrency isn’t essential to them.
As we moved from to the blockchain, not bitcoin narrative, the story was that blockchain allows all sorts of peer-to-peer interactions, not just transferring bitcoins. The tech can move anything from one wallet address to another without asking anyone with a permanent record of ownership. With smart contacts, these transfers could become more and more useful. Uncensorship networks? Peer-to-peer markets? The trust engine? Increased possibilities for what the tech can do makes the story weaker and harder to explain. You can track stuff better, audit transactions in real-time. You can give users control of their identity and their data. To some extent, smart contracts have broadened the possibilities but weakened the story.
Over the last few weeks, we at Outlier have been trying to figure out what exactly Web3 is. I have been playing around with two different perspectives: a computing lens: server versus client, and a network lens: core versus edge. In Web2, the dominant innovation platform was the server/core (aka “The Cloud”), and in Web3, it is shifting to the client/edge (aka “Ubicomp”). But maybe this is the wrong approach. People don’t care about what happens backstage; they care about the stage.
The trend to tap into is the changing nature of trust. One of the biggest social trends of our time is the loss of faith in institutions and previously trusted authorities. People no longer trust the Government to tell them the truth. Banks are less trusted than ever since the Financial Crisis. The mainstream media can no longer be trusted by many. Fake news. The anti-vac movement. At the same time, we have a generation of people who are looking to their peers for information:
- 89% of millennials trust recommendations from friends and family more than claims by the brand;
- 84% of millennials report that user-generated content on company websites at least somewhat influences what they buy;
- 84% of millennials don’t trust traditional advertising.
And with blockchains and peer-to-peer networks, we have the tools to enable faster, cheaper, more convenient p2p experiences.
So, as people come to trust institutions less and peers more; the pitch could be: trust people, not Big Tech. Or trust people, not companies. Blockchains are a part of a much bigger social movement, the changing nature of trust.