Making money on blockchain requires retrofitting the web to use blockchain to do what the web can mostly do already.
In "Blockchains Are a Bad Idea", James Mickens gives several arguments against blockchain-based systems like Bitcoin:
See his presentation here: https://youtu.be/15RTC22Z2xI
1. People have out-of-band trust relationships in real life which reduce the likelihood of malice. Bitcoin-style anonymous identities undermine trust relationships and are not needed for legitimate (not illegal) transactions.
2. Real life legal systems encourage good behaviors. If you have a dispute with someone, you can sue them. Bitcoin and related systems lack these protections.
3. Existing tools such as public-key cryptography and digital signatures can provide most of the functionality that applications need without the problems that blockchain-based systems have.
1. Zero trust is highly optimal for business. When it is systemically impossible to cheat your vendor/customer, nobody even tries. Happy path only.
2. Good luck suing someone in a foreign jurisdiction with incompatible legal systems. Maybe that sex toy would be embarrassing on ones credit card and tagged to ones identity. Cryptocurrency (especially private cryptocurrencies like Zcash and Monero) offers an alternative to doxing yourself.
3. You miss the great innovation of SN: Preventing Double Spends. You cannot enforce double spend without a source of truth -- which was traditionally central server/banks.
It was the Proof of Work that made the ledger distributed and censorship resistant, and it is the ledger that prevents double spends. And with Bitcoin, you have a limit of 21 million coins, which addresses SN's concern that central bankers ALWAYS inflate currency. So, no, existing tools did not suffice. That is why we have Bitcoin today.
I don't understand what point you tried to make, and frankly it sounds incoherent.
Moreover, the weasel word "highly optimal" means nothing. You failed to present any value proposition, specially when discussing a solved problem.
This is perhaps the main problem plaguing web3 proponents: they always fail to present any value proposition at all, and instead resort to all sorts of handwaving to try to distract away from that void
> 2. Good luck suing someone in a foreign jurisdiction with incompatible legal systems.
This statement fails to take into consideration the very notion of a jurisdiction, and somehow presumes that a shop in a country which chose to do trans-national business shouldn't have to deal with the legal implications of operating in another country.
> 3. You miss the great innovation of SN: Preventing Double Spends.
That is not innovation in commerce: it was already a solved problem before the inception of blockchain-based technologies.
Email interoperates, but messaging doesn't. There's no adopted standard for identity (except centralised Google/Apple), or for payment (except centralised PayPal/Apple, and the bad UX of entering credit cards).
Turning these (and more) into protocols would allow more innovation at a layer above that. This innovation just can't happen right now, as FAANG have to approve of everything you do that works with systems the populuation already use.
web3 doesn't seem good enough yet to help, but it is at least working on it. And it could potentially solve the lack of identity and payment standards.
This is incorrect but educationally so: there are many new distributed protocols (RSS/Atom, XMPP, various things around blog interactions like FOAF and ping backs, GraphQL, OpenID, etc.) but the ones which successfully saw adoption were adopted by a few large companies who saw advantages from doing so. Being open or distributed not only wasn’t enough to be competitive with the centralized platforms, it often prevented that since you needed to coordinate improvements across a range of competitors while Google or Facebook could just ship an update.
Consumers didn’t value client decentralization, especially when that meant incompatibility, lower performance, and fewer people they know using a service.
Putting things into a blockchain not only doesn’t help with any of the real problems but makes all of them worse: performance and reliability are completely out of your control, everything costs money (good luck getting users when the competition not only has better features, perform, and social graph but also doesn’t charge them to sign up or send messages!), and since you centralized onto a network run by finance companies the only way to get traction on any of that is to have enough money to be taken seriously.
Standard for identity - not sure what you exactly mean by this, but there’s WebAuthn / OpenID Connect / SAML
Standard for payments - W3C web payments
Whether it’s Bitcoin, DeFi, DAOs or NFTs Web3 allows you to participate in owning digital property at the protocol layer. Imagine if you could have profited directly from your early adopter curiosity and passion for the early internet by owning a part of the base layer, instead of waiting till the IPO where VCs and early shareholders take most of the profits before dumping their bags on the public.
That’s Web3
And it's already there it seems: https://ens.domains/
I wonder how does one integrate ENS into an existing DNS-based system — is there a DNS-compatible resolver that will look up names on ENS (and an IPv4/IPv6 proxy perhaps)?
It's also a missed opportunity to provide hierarchical certificates at the same time, signed by the registry, though in a sense, a smart contract is exactly that, but I am more interested in simple name-resolution and TLS communication for traditional web applications like HTTP and mail (name-to-IP).
We've decentralised transfers with BitTorrent pretty well, and it's actually reasonably fast and cheap to operate. Opera used to have it built-in, and there are some WebRTC versions.
The web has a decentralised database of domain ownership - Certificate Transparency. The same approach could have been done for NFTs if they were really about owning digital assets, and not gambling on a pump and dump scheme.
Basically there are lots of energy efficient and lower-latency ways to decentralise the web if we wanted to. But the web tends to clump around large services mostly due to economies of scale and user convenience (average user can't be told they've lost their private key and they're totally screwed).
The radical change here is that now anyone with some pocket change in crypto can deploy a decentralized application. We don't know how that's going to be used yet, it's still so early, but it's certainly exciting.
Web3 is a terrible name (as everyone else has already pointed out), but the magic that shouldn't get lost here is that a new decentralized internet is being born.
Oh man it'll be awesome. Decentralized applications running on someone else's hardware with no SLA or even a meaningful relationship between the application author and person(a) executing it. Terabytes of data will just sort of float on the blockchain...sorry, immutable data store. I'm sure it'll be super fast when uploading from people's residential Internet connections.
So exciting!
Genuine question, how is that different from renting a VPS or buying a Raspberry Pi and running your website on it?
What about decentralized malware?
Web3 seems like a perfect opportunity for malware applications and hosting illicit content.
Have some CSAM you want to host? Put it on Web3! Want to dox someone or leak sensitive info captured in a hack? Put it on Web3!
Edit: This also begs the question: what legal liability might one face for hosting illegal content on Web3?
Internet is already decentralized for the most part. I run my own web server and mail server from my home. There's my "piece of the Internet".
Sure, DNS is centralized (even though it's heavily federated), and TLS certificates are centralized (less federated).
So, what we are looking to replace is simply "who is there?" and "is it the real you?" services with something less... centralized. This can live on the blockchain, sure, but blockchain is a database you sync across in its entirety, right? I am sure you can only get parts of it for some applications, but this, by definition, does not scale to the size of the Internet. (Hum, this is probably a decent dapp proposal: domain name system with certs, but it'd still grow very large if it was to cover entire Internet)
I don't get the connection with Google/Amazon/Facebook either: they are humongous services operating on the decentralized Internet today. Yes, people flock to them, but that's exactly the Internet you can avoid (a recent discussion on search.marginalia.nu gives a pointer as to how).