Tech innovation is fueled by demand. Amazon Web Services (AWS), for example, appeared after the retailer’s need to grow became apparent. But they eventually created a new solution for other services that needed the same technology.
But what kind of demand fuels decentralized technology? Does it have the ability to nourish the next giants of Web 3.0?
Creating a solution to what exactly?
When blockchain first surfaced, crypto experts believed it was the missing piece that could turn decentralization into a dream come true.
This misconception originated from the belief that trusted intermediaries were the only obstacle between users and a free, decentralized, trustless web.
AWS, Azure, and Oracle started to build platforms out of a specific need, mostly to scale ecommerce. But the emerging blockchain ecosystem had previously been locked inside itself: customer adoption has only been possible through the creation of new cryptocurrencies and trading them within the community.
There are also projects like Dogecoin and CryptoKitties. Dogecoin was a currency that Adobe product manager Jackson Palmer created as a joke. Within the first month of its release, it experienced a 300-percent gain, followed by losses when its wallet got hacked.
CryptoKitties, on the other hand, is an app where you can buy and breed a digital pet on blockchain. Users like its looks, but it’s not user-friendly and creates no tangible value.
But is there anyone out there creating symbiotic growth like Amazon (which created demand and brought in new customers outside the community) and AWS (which provided means to scale while being broad enough to have multiple use cases)? Is it also possible for blockchain to build the next Uber service, using only decentralized technology?
The answer is no—or at least not yet. The crucial parts needed to build a decentralized solution are still missing:
- An easily accessible data storage for developers
- Recovery and processing of information in real time
- Immediate access to data from any point in the world
In addition, current blockchain platforms work with overly redundant data protection mechanisms (e.g. Bitcoin and Ethereum, where each node in the network has to store the entire blockchain and perform the computations), while algorithms are cheaper than proof-of-work and regular developers aren’t familiar with blockchain-specific tech.
Of course, there are many great companies developing interesting projects like IPFS (a peer-to-peer data transfer protocol that aims to substitute HTTP) or Lightning Network (a fast payment protocol on blockchain).
Companies like Golem, Storj, and TrueBit are also creating data storages, marketplaces, transfer layers, higher-performing blockchain platforms, distributed computing, and verified computations. All of them improve further research and technological advancements.
Unfortunately, a great product works not as a sum of its parts, but as a whole, serving one purpose and one single demand. All these projects need a focal point for application.
A new, customer-oriented perspective
Blockchain projects today should focus on one single purpose: to build a service for people. Building more platforms and trying to fit blockchain-based solutions into isolated cases won’t create real demand from users. Creating a real solution means answering questions such as:
- How can we serve our users faster?
- How can we protect our user’s data?
- How can we scale to serve our users more?
- How can we provide a better user experience?
We need a service that will successfully translate the benefits of decentralized tech into user-friendly, compelling features that provide a clear value for the end customers.
Blockchain projects today and dapps like CryptoKitties won’t see any growth or mass adoption until we break that barrier.
The fintech world, for example, has already embraced blockchain adoption. Ethereum is already helping to tokenize assets, while other cryptocurrencies are being used for cross-border transfers.
But in order to achieve general internet services such as apps and games built on blockchain, we need to create a better infrastructure first.
Low-level protocols which are building blocks of the internet should first become more mature, stable, and fast. These protocols should be supported by major players on a hardware level.
A fully decentralized internet comes with its own challenges. But its key promise to provide services that can’t be compromised or owned by any single entity, while giving users full control of their digital life, is a challenge worth the risk.