As predictable as night following day is that an overload of hype and excitement will soon run into a reactive wall of snarky cynicism, and there’ll be handbags on Twitter.
And so, it is proving to be with web3 which after months of excitement, because we’re all going to be free, frivolous and fabulously rich, has suddenly been under attack from Jack Dorsey, formerly of Twitter, now to be found on Twitter.
Jack is freshly emancipated from the restraining shackles of his own business, that he actually co-created and was the boss of, and so is now free to speak his mind, knowing that he is not being watched over by himself.
He got into several exchanges, but one of his tweets seems to articulate his position succinctly,
"You don’t own ‘web3’."
"The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label."
"Know what you’re getting into…"
Additionally, in an exchange with Elon Musk, he made what reads like a disparaging reference to venture capital firm a16z (founded by Marc Andreessen and Ben Horowitz), which is heavily invested in crypto and web3 projects.
It is easy to be cynical about the cynicism. Here is a guy who got to the top through web2, putting the boot into web3.
And, what is more, the portion of web2 that he created and controlled, Twitter, has been, in many respects, a cesspit. The platform Jack steered for all those years has become infamous for heavy-handed censorship, removing the accounts of users for what appear to be political and ideological reasons, from a famous comedy writer to, most staggeringly of all, a sitting US president.
And, this authoritarian approach has escalated during the global covid fiasco, during which Twitter has been weirdly aggressive in shutting down dissent over draconian pandemic response policies, and took recently to appending tweets with patronizing, vapid warnings that an adult conversation might, brace yourself, become intense.
You might wonder, having presided over all that and done nothing to make things better, who exactly Jack thinks he is, popping up in replies to pass judgement on others.
But then, forget Jack for a moment, look at the broader view of who is facing off, and you see something different, as the majority of those hostile to web3 are the bitcoin maxi faithful, and suddenly it all starts to make a bit more sense.
Web3 at its most utopian goes something like this: you are no longer at the mercy of and owned by the big tech platforms, constantly having to ensure that you remain within their arbitrary codes of conduct in case they give you the boot. Instead, you own your own content, and you own your own digital identity.
Web3, ideally, is decentralized and cannot be censored or ruled over unfairly. You are sovereign within the online environment, and what is yours is yours, with full ownership secured by blockchain technology.
Furthermore, value flows around the web3 environment in the form of cryptocurrencies, allowing for trade and monetization on your own terms, not to mention DeFi, DAOs and ground-up wealth creation.
Sounds nice, right?
But, could there be a flip side, a dystopic version? Sure there could. Jack Dorsey’s problem is with VC funding, and he raises doubts about the claims that web3 will be decentralized. But, there are other potential downsides too. Here is an excerpt from an a16z rumination on digital identity:
"Web3 is based on the premise that each internet user will have a unique internet identifier, like an email address, that can be natively linked to any piece of software and stored on a blockchain. As part of someone’s 'decentralized identity', a portion of a person’s online activity would then be 'on chain', meaning that it would be public and easily searchable via their individual crypto wallet."
"With such decentralized identity, a readable history unique to each person, one’s crypto wallet would function as a sort of profile, similar to Facebook or LinkedIn. But, unlike web2 profiles, decentralized identities are backed by hard evidence: a permanent, timestamped record of a person’s accomplishments, contributions, interests and activities to date."
"If decentralized identity were widely adopted, people would be able to carry their full selves with them as they traverse cyberspace: their affinities and experiences reflected by what they have created, contributed to, earned and owned online, no matter the specific platform. This would bring us closer to how things work in the physical world, where our possessions and reputations are attached to us, rather than to the spaces we occupy; we can take them with us and use them however we please."
I think they are trying to sell the idea, but it sounds grim. After all, what are we upgrading to, in this case?
We own our content, sure, but we have no privacy, and our entire online existence is locked eternally into an indestructible database. We can be reviewed, shuffled and sorted, about as human as an Airbnb listing, and with all your laundry out to air, forever.
In the physical world, this is not at all how things work. Time erases and heals, memories become scattered, and what once seemed important evaporates into sketchy nothingness. But, in a bad version of Web3, everything you do is captured and attached to you forever, and the past is always current, no matter how distant.
And, then you look at bitcoin. What does bitcoin represent? What did it always promise, at its core? Realistically or not, bitcoin was freedom money, enabling a different form of existence where you were no longer shackled by banks, institutions and the requirement to conform to things you do not believe.
Bitcoin was cypherpunks, and refuseniks, and the idealism it presented was the gritty type, that does not show its papers or care what you think. Looking at it like this, you can start to think the bitcoin ethos is almost as far removed from web3’s chipper gm frens as it is from the deranged, woke authoritarians who took over web2.
So who is coming out on top of all this? For my money, when it comes down to it: everyone. Bitcoin genuinely does represent a decoupling from existing financial institutions, while web3 (for want of a better name) actually can decentralize the web.
What is more, many web3 users, not VCs, just optimistic people who jumped in and started utilizing DeFi, minting NFTs, staking crypto, yield farming, play-to-earn gaming and exploring with an open mind, are being rewarded right now, in meaningful financial terms.
Rewarded, in fact, just like those early bitcoin miners who found something new and made it work and unmoved by what the rest of the world had to say.
And, if the two camps want to snipe at each other on Twitter, that is fine too, as it makes for good entertainment.
In reality, though, is there actually any conflict? Bitcoin already is a store of value, and it can be, and is being, used as a currency, and it is still only a little over a decade old. On top of that (or underlying and fundamental to it), bitcoin acts as a masthead and a call-to-arms for, simply, a better way of life. This latter characteristic is unique to bitcoin and its history, and cannot be emulated by other blockchains.
But, as for web3, that is coming too. It is not bitcoin, and so it does not challenge bitcoin, just as bitcoin is not web3, and offers no challenge to it. The priority for web3 then is to ensure that it manifests in its most enlightened, emancipating and positively disruptive form, providing another avenue for freedom, to run alongside and complement the freedom already being offered by bitcoin.
From where I’m standing, there is no conflict between bitcoin and web3 technology. In fact, quite the opposite; they go together well.
