7 problems of Web3 industry and how I plan to solve them

Web3 is a very misunderstood term.

It’s a beautiful vision wrapped in layers of pomposity, self-righteousness and greed.

“We’re disrupting the internet,”
“It’s a financial revolution,”
“Own your data,”
or “Power to the people”
is often a code phrase for “Please buy my worthless tokens so I can become rich.”

Is Web3 bad?

No. But it’s earned and continues to earn a very bad reputation.

What is Web3?

My definition is “the next generation of the internet powered by new emerging technologies” (like blockchains, cryptographic identities, AI, IoT, DePIN… plus their convergence with each other) that have potential to increase productivity and elevate the world’s economic output.

In simple words – just a collection of new awesome tools to enable new awesome use cases.

Just like it was with the original Web and later with Web 2.0.

And it’s not just “anything and everything with crypto on top”.

Like the second iteration of the Web wasn’t just about social media and user-generated content.

It was many things including… cloud computing, mobile apps, GPS/camera/sensor-enabled smartphones, fiber-optic/3g/4g internet, new html/css/js frameworks and most importantly… THE CONVERGENCE of all these technologies… that enabled so many new use cases we collectively refer to as Web 2.0.

Many industries were disrupted. Many new ones were created. Many people have lost and gained tremendous wealth.

And I’m sure we will see this happen again. Maybe on an even larger scale.

What’s wrong with Web3 today?

Here’s what I believe is at the core…

1. Not enough real-world use cases

Web3, especially in the context of blockchains, is often seen as a solution looking for its problem.

I don’t agree. But I see where it comes from.

If all you have is a hammer, everything looks like a nail.

And it’s funny how some people try to shoehorn crypto into every project even when it doesn’t make sense.

All while ignoring use cases that could benefit greatly from this new technology (because finding and implementing them usually requires more effort).

2. Speculation > Innovation

It’s hard to devote oneself towards creating something truly valuable when there’s a constant allure of making a quick buck.

A roulette table is way more fun than a work desk.

Overpromising is always easier than overdelivering.

Making bank on day 1 sounds better than on day 1234.

Putting in little time and effort feels nicer than working 24/7.

Unfortunately, Web3 today appeals to a lot more short-term grifters than long-term warriors.

3. This is a scammer’s world

If there’s something Web3 has already won a gold medal in – it’s the number of scams and how sophisticated they are.

Sometimes they are so sneaky you can’t even say if you’re being scammed.

Consider soft rug pulls.

It’s when instead of collecting money and running away like in straight-forward scams, some projects create an illusion of “something happening”. So you can’t say it’s a scam.

And since there’s no accountability or transparency on how the money is spent or what’s going on behind the scenes… Founders don’t care whether anything actually gets done.

They consider all the money they raised as theirs.

All they have to do is spend a small portion of it to pretend that the project is not dead until… everyone forgets about it.

After all, incompetence is not a crime. At the end of the day, they can say “it simply didn’t pan out”.

That’s why there are so many people who just hate Web3. The amount of bastards who intentionally hurt people in this industry is simply unbearable!

4. Unsustainable models

It’s amazing how often “new innovation” in crypto means just another well-disguised Ponzi scheme.

We’ve seen it with play-to-earn games and other do-something-to-earn apps, we’ve seen it with ICOs and NFTs, we’ve seen it with launchpads, IDOs, airdrops and, recently, with memecoins.

Every time there’s a token, someone has to be left holding the bag. Someone has to be the sucker.

Every time you see a token, ask yourself: Where does the value come from?

Who will buy this token and why?

Most of the time the answer is: the next person in line hoping to sell it later for more.

It’s the idea + hope, not value, that drive these short-lived bursts.

It’s not tokenomics. It’s ponzinomics.

Sustainable model is when tokens are minted or distributed as a result of value creation.

And by value I don’t mean using tokens to get more tokens or artificially inflating their price (like staking programs where you lock the supply). This would be a clear sign of ponzinomics in action.

I am talking about the value end users get when they redeem the tokens.

5. Hiding behind the ideals

For many, Web3 is an ideological battle.

It’s about radical freedom.

Taking away power from greedy corporations.

A world free from intermediaries.

Where anything less than complete decentralization is frowned upon.

I get it. I support this vision.

However, Web3 is not politics. It’s business.

We don’t win by pushing the agenda. We win by building the best products.

And only users can say what is the best.

They vote with their time, their attention and their wallet.

Often by chasing ideals Web3 projects compromise over basic things like usability, security and performance.

They try to compensate the lack of a great product by selling a dream of a decentralized world.

Sometimes these products simply lack common sense.

Or they are so overcomplicated that users are simply not interested.

Look, I don’t care whether a project is fully decentralized or partially centralized.

Does it bring value? Does it solve problems? Does it work?

If we can achieve the same without a blockchain, without a token, then why shouldn’t we?

It must be a value-add, not a value-suck.

Of course I believe in pushing towards decentralization, openness and freedom as much as possible. But only if it makes sense. Only if it makes a better product and users see the benefit.

Otherwise there’s no point.

6. Technology > Psychology

There’s a lot of emphasis on technology in this space and a lot less on how to actually make it work.

We already have plenty of tools. Yet there are so few people who can use them successfully.

It takes just a few minutes to set up a functioning DAO (Decentralized Autonomous Organization). Yet how many successful DAOs have you heard of?

Millions of new tokens are launched every year. Yet how many of them actually turn into great projects?

It’s not only about a tech stack. It’s also about a mind stack.

Here’s what I mean...

The biggest challenge of a DAO is not writing the best smart contract. It’s designing a governance model where people actually care and show up.

The biggest challenge for any token is not choosing the right blockchain. It’s coming up with robust tokenomics that can stand a test of time.

This requires insights into psychology of people, how they behave, what makes them tick.

Yes, technology is vital. But we already have a lot of people obsessing over it.

However, far fewer people understand how to implement it successfully.

If we want Web3 to be more than a beautiful car sitting idle in a parking lot… If we want to actually race this beast and have fun… Then we should focus on implementation aspect at least as much as we do on underlying tech.

Otherwise we’ll be left with too many rusting cars and very few capable drivers.

7. Compromised reputation

This is probably the biggest issue the industry faces today.

When you mention Web3, many people outside the space cringe. They immediately think of scams, sketchy personalities, cult-like followings with often smug, dogmatic and radical views.

Feels more like a dark alley than the future of the internet.

This image repulses a lot of people who could otherwise be a great addition to the space.

Many talk about mass adoption of Web3 and they mean users. I think it’s way more important to attract a lot of great talent. Only by having the right people aboard can we reach our destination – build better products, attract users and solve every problem I mentioned above.

However, if people are smart, they see this space for what it is – a rigged game often controlled by shady people. Where everyone is obsessed with quick profits. And hide their true intentions under layers of fake aspirations and industry jargon.

Of course, it’s only one side of the story. Unfortunately, it’s the loudest and it’s what people see when they enter the space.

Not sure if it’ll ever be possible to remove this stigma.

Maybe it’s time to start anew. And rethink this industry.

Not to say there aren’t other challenges like regulations, UX/UI, scalability and others...

However, these are not the only reasons why Web3 is marking time and not moving forward.

You can always move to a country with more favorable laws, build better UX/UI and use faster and cheaper blockchains which are available today.

However if you want to cut corners, prey on people’s hopes and dreams and chase quick profits instead of creating real innovation, then there is no way forward.

The problems I listed above are foundational and much harder to overcome.

What’s my plan to solve these?

Obviously it’s not going to be easy. I’m not naive to think I can single-handedly solve all these problems for the entire space.

What I believe I can do, however, is create a subsection of this industry where all these problems are obsolete.

It’s going to be an experiment – an attempt to create an alternative (parallel) world for more practical implementation of Web3 without all the nonsense.

If Web3 is a culture, then what we need is a sub-culture.

If you remember the days when SEO (Search Engine Optimization) was a thing, there was “black hat” SEO and “white hat” SEO. What we need right now is that kind of “white hat” rational and honest approach to Web3.

Here’s my plan:

Step 1. Start a community – a space where kindred minds gather to build great projects.
Step 2. Attract the best people – find and convince the best talent, investors and enthusiasts to come aboard.
Step 3. Streamline project building – establish an optimal way to found, launch and scale winning startups powered by the magic of Web3.

It’s kinda like a startup studio but powered by a large passionate community.

The ultimate goal is to create something that feels like a playground. A collaborative space where everyone can dive into the joy of creating, lending a hand, having fun, and sharing the rewards. With rules that make sense and no room for cheating.

The result? Great projects that bring positive impact – serve people, disrupt industries and push the space forward.

Why (do this)?

Because despite all the problems and damaged reputation, Web3 is still a revolutionary concept.

It’s just a matter of time when these breakthrough ideas find their way into reality.

The question is how many more billions of dollars people have to lose on rug pulls and scam projects before we finally get there.

It’s time to create an alternative. A place for better projects.

Where good guys win. And get highly compensated for doing so.

How can you participate?

First and foremost – subscribe to my newsletter and follow me on socials (Telegram, X/Twitter, LinkedIn) to stay in the loop.

I’ll be sharing the journey there – and giving everyone who follows a chance to get involved.

The next chapter of Web3 starts with us.

Let’s show the world what it’s really about!