Crypto and the Conservation of Centralization

Based on the above, the answer(s) to the second question is that the gatekeepers of web3 will be organizations that know how to allocate capital in a world of endless investment opportunities (A16Z is already working on that). They will also be organizations that can aggregate demand for various shared resources — just like Airbnb, but for many mor... See more

The answer to the first question is that blockchain commoditizes investments by making everything ownable and investable. It creates an abundance of things that can be owned. It also creates an abundance of various resources by making them easier to share. Finally, it creates an abundance of human engagement – the ability to incentivize people to a... See more

The trillion-dollar question is which companies will be the giants of the coming web3 era. What does blockchain commoditize? What does it make abundant? Who is in a position to become a gatekeeper in a world of such abundance

But Google's (relative) position did not last too long either. The internet has become more personal and more social. Individual people (as opposed to companies and specialized "webmasters") started to generate more content and wanted to interact with each other rather than simply "browse" static content. Power shifted towards Facebook and other pl... See more

AOL's power eroded. In a growing web of millions of websites, the most valuable activity was no longer to tell people what to consume. Instead, it was to help people find what they were looking for. And so, Google emerged as the internet's primary gatekeeper — and moneymaker.

The commoditization of the actual hotel did not eliminate all profits in the industry, they just shifted these profits to other activities. Hence, "The Law of Conservation of Attractive Profits." When some parts of the value chain become commoditized, other parts necessarily become more valuable.

But decentralizing one class of internet companies does not guarantee that a new class of centralized giants will not emerge in their stead. In fact, decentralizing power from one pair of hands is almost guaranteed to concentrate that power in another pair of hands.

This effort can be divided into two main fronts: Decentralized Utility and Decentralized Ownership.

Crypto and blockchain-based applications aim to steer the web towards its original vision: an open network, based on public-domain protocols, controlled by no one. It promises to enable "decentralized" alternatives to the tech and government giants we all know and love.