The Paradox Blog: Your source for all that stuff up top

This is my personal blog, where I write about random things that I find interesting or noteworthy.

Why Web3 will never work: it already does

September 29th, 2022

A while ago, Big Tech found a new buzzword to obsess itself over. This time, it's Web3, the combination of the modern web with crypto, blockchain/NFTs, and the Metaverse. Holy mother of buzzwords. This might be overwhelming; here's a rundown of just what all of these things are:

• Cryptocurrency: digital currency, detached from real-life currency
• Blockchain: a database that is distrubted across a peer-to-peer network (members communicate with each other, not a central server)
  • NFTs: Non-fungible tokens, items on the Internet that can be bought and sold with cryptocurrency, with ownership verified by blockchain
• The Metaverse: all of the separate metaverses combined (similar to the proper noun version of Internet). A metaverse is an online experience where people can socialize in decentralized communities

If you're in the know, you know that all of these things suck in practice. Cryptocurrency is extremely volatile and fragmented, NFTs are nothing more than a way for scammers to sell AI-generated monkeys and other subjects, and the Metaverse is just Zuck's latest pipe dream.

But what if I told you it wasn't all geeky nonsense? Every single one of these technologies has already been implemented in a better form.

Note: I am not an expert on any of these subjects. If any of this is blatantly wrong or incomplete, reach out to me.

Stablecoin: practical yet unpopular

Popular cryptocurrencies have a huge problem: volatility. The most popular coins are popular specifically because they're volatile; it's very appealing to buy crypto, wait until the value booms, and sell to make a profit. These fluctuations of popularity will make the value of the coin fluctuate, too. That's the major problem: people see crypto as an an investment, not an alternative to paper money. So, the solution is to make a coin with a stable value, right?

Introducing stablecoin, a breed of cryptocurrency that is usually pinned to a certain value. The lower volatility provided by a constant real-world value equivalency makes it a much better option practically. The most popular stablecoin is Tether, or USDT, which is always valued at 1 USD. The problem with this, though, is that the main draw of popular cryptocurrency is its investability; the crowd of people who actually want to use it as currency is, comparatively, very small. This makes for a difficult scenario, not unlike program availability for desktop Linux: people don't use stablecoin, so online retailers don't accept payments in it, so people don't use it.

Another problem comes from within the "crypto bro" niche. Most of these crypto enthusiasts, those who frequently make cryptocurrency transactions, completely oversee the idea of stablecoin as a major component of Web3, disabling its ability to become popular. If it isn't popular within the niche, it won't be popular in public. This isn't to say, however, that stablecoin popularity is impossible; Singaporean custom PC outlet XY Tech, famous in the ThinkPad Reddit community, accepts payments in USDT and other stablecoins. Widespread adoption, however, will take lots of action and patience.

The Steam Marketplace: NFTs but better

NFTs are one of those things that you think about and think, "there has to be more to it, right?" and then there isn't. The most popular NFT trading websites deal almost exclusively in artwork, appealing to a very small audience. Most people see these and think that the "ownership" of an art NFT is worthless, as anyone can copy it for themselves. Frankly, they're right; it's not even "non-fungible" if the only thing stopping these other people from "owning" the NFT is a database that they don't care about. There's no enforcement and therefore no meaning to "ownership"; it's like having laws without police. However, there are other marketplaces that have had great success in retailing similar digital tokens. Once such marketplace is the Steam Marketplace.

If you don't know, the Steam Marketplace is a feature of the Steam games launcher and store that allows users to buy, sell, and trade items from video games for other items and real-world money. Items on the Steam Marketplace follow a very similar design as NFTs: they're unique, digital items that have real-world value. The difference is, these tokens are actually useful. You can right-click most art NFTs and get their full value, but items on the Steam Marketplace have functions that can only be unlocked once they're bought. This function is also more understandable than owning artwork; if you've ever played Team Fortress 2, you've probably spent plenty of time trading Refined Metal and Keys (similar to cryptocurrency) to buy weapons and cosmetics (similar to NFTs) for you to use in-game. It's an obvious use that art NFTs lack.

This isn't to say, of course, that NFTs are inherently flawed. Notice how I've referred to the most popular forms of NFTs as art NFTs, specifically. NFTs are just non-fungible tokens: unique online items that can be bought and sold. There's no rule that says that an NFT can't be something useful; in fact, most items on the Steam Marketplace are comparable in almost every way as NFTs, save for the fact that many aren't unique, as you can get them from the games they come from, too. Theoretically, a video game economy where the items are unique NFTs could potentially prove to be very successful; the biggest roadblock to this being Valve, who has banned games that deal with cryptocurrency and NFTs. The developers of Age of Rust, one such game, have stated on Twitter that Valve did this due to crypto and NFTs' real world value, although Valve has not made a public statement about this. (Dec. 2022: This account no longer exists, so just trust me or read about it from a gaming journalism site.)

VRChat, Minecraft, even Discord: metaverses in action

When Big Tech companies talk about the Metaverse, they speak of it in the future, like it's a goal to be achieved. However, the concept of a metaverse already exists today, and it has existed since the beginning of consumer online networking (before the advent of the Internet!). Really, any online socialization space can be a metaverse; social media, Discord, Minecraft, and many more. If we go back farther, we see Internet forums and image boards. If we go back even farther, we see AIM, then IRC, then BBSes, then mailing lists. Online socialization has existed since you were able to plug a PC into a telephone. The Metaverse isn't really a new concept.

Now, some people will say that the Metaverse has to be an XR (extended reality; VR and AR) experience. Did somebody at Facebook forget that VRChat and Rec Room are things? And that they have been things since 2014 and 2019? I'm not even going to bother writing more than a paragraph and a few sentences; this point speaks for itself.

Conclusion: Big Tech sucks

Well, what have we learned today? Big Tech wants you to think that Web3 is something new. This is my first blog post, so some people might not know this about me, but I really hate Big Tech. Like, a lot. Web3 is one of my many, many reasons. Sure, all of this stuff already exists, but what's really important is that Big Tech is into it. When a corporation markets something, they always want you to buy it. In fact, Opera is already offering a Web3 crypto browser for the "crypto-curious and crypto-savvy". Huh. Stay vigilant, everyone.