Why Build in Web3

Managing digital assets on public ledgers makes it clearer which assets exist and who owns what, which was previously a struggle on the web. 

Making platform backends open and interoperable enables compounding innovation and incentivizes direct investment in building the infrastructure layers.

Today’s dominant internet platforms are built on aggregating users and user data. As these platforms have grown, so has their ability to provide value — thanks to the power of network effects — which has enabled them to stay ahead.

Indeed, taken to the limit, in Web3, users sometimes have no need to trust the company (or people) behind a project; rather, they just have to trust the code itself.

These digital assets are typically created according to interoperable standards on public blockchains, instead of being privately hosted on a company’s servers. This makes the assets “portable,” in the sense that a user can, in principle, leave any given platform whenever they want by unplugging from that app and moving — along with their data — to... See more

Sharing ownership allows for more incentive alignment between products and their derivatives, creating incentives for everyone to become a builder and contributor. 

Web3 platforms also have the potential to unlock a novel and especially powerful form of network effect through community engagement and social cohesion. 

This trust framework extends to the software that runs Web3 platforms: key operations can be encoded on the blockchain in “smart contracts” that are auditable and immutable. This makes it possible for a platform designer to commit upfront to certain design features, such as pricing rules, royalty agreements, and user reward mechanics.

In Web3, instead of platforms having full control of the underlying data, users typically own whatever content they have created (such as posts or videos), as well as digital objects they have purchased.