Sometimes things are the way they are; Late flights, expensive transfer fees, and taxes. We don’t like it, we make small talk by complaining about it, and we wish there was something better. At the same time, despite all the frustration, we accept these things as flawed yet immovable objects, part of the permanent structure in the world around us. Oddly, we see things we don’t like but don’t try to change them. That might be due to those things not changing for a very long time, or perhaps we simply can’t imagine a way to get rid of them.
Enter Web3. While the average person may group Web3 with crypto trading, this is very far from the truth. While cryptocurrencies are part of the Web3 ecosystem, the value Web3 currently adds is much more expansive. More so, the use cases for Web3 we haven’t even thought of yet are incredibly broad, at least based on the new use cases being discovered/developed daily. As Web3 first gained notice, many were limited in what they saw as the capability. Elements involving a platform’s tokens were envisioned, and some of the interesting effects of a borderless currency were explored. Topics like the metaverse were envisioned, though even here only a limited number of metaverse use cases were explored (shopping, events, land/asset owning, NFT characters, etc.).
After some opportunity to look back on how Web3 is developed, we’ve started to see certain patterns and features. The concept of a token is important as a way to bring people from all over the world and operate without heavy transaction fees, currency fluctuation (within the platform; this is separate from crypto trading), or relying on compatible payment platforms. The concept of smart contracts allow for major automation without having to trust any person or organization; parties can interact quickly and without fear of someone halfway around the world stealing their money. A decentralized organization of community members making decisions for the community is especially interesting; not just because Web3 can help this be done globally, but because this concept is difficult to accomplish when all the people are in the same room.
Let’s take a few of these “will never change” complaints and see how Web3 can transform them into something new, something better, and something inspirational.
While “gamification” can mean a number of different things, the element of bringing real rewards into the gaming experience is prime for a Web3 treatment. This has already been shown with “play to earn” style games, but there are many additional opportunities as well. The ability for games to be tied to a token as well as a smart contract is important. This creates the ability for the contract itself to manage peer-to-peer transactions, and in the case of NFT assets, it allows players to take their characters, items, skins, weapons, and more out of the gaming platform and onto a marketplace for them to buy, sell, and trade. It allows players to gain more value out of these assets. By using a common token within a game, elements like rewards, bonuses, and winnings from battles become much more interesting. Instead of just numbers on a scoreboard, these tokens could potentially be traded on an exchange.
In terms of investment opportunities, Web3 has created some interesting use cases. Many people think of crypto staking, borrowing/lending, and other more traditional channels. This is all well and good, but an arguably greater use case is highly democratizing the ability for someone to invest in physical assets. One prime example of this is Arakis, which is partnering with members of the travel industry such as hotels, airlines, car rentals, etc. The goal of the platform is to create Revenue Sharing Tokens (RSTs), which anyone can purchase. Each RST is tied to a specific asset, and as the name suggests, revenue is shared between the owner of the asset and the owner of the RST. One example of this is buying an RST for a hotel, and any time a room is rented, you earn a portion of the proceeds. This is significant for a number of reasons. Never before has a person been able to directly invest in a revenue opportunity this way. There have been other forms of “partial investment” opportunities with something physical, like a piece of art, but not while using the global security of smart contracts and tokenization. This opens up any number of use cases, not just with the travel industry but nearly any industry where investment is needed and revenue generating assets are in play.
Borderless transactions may be the biggest form of “this will never change.” Anyone who does business internationally, who sends money to family in another country, or who is trying to get cash out of an ATM while abroad knows all about this. For many of these transactions, they can take 3-5 business days. In a world where most things are done instantaneously (even Amazon offers same/next shipping on physical goods), this is effectively an eternity, especially when the money is needed urgently. Even when you can get the money instantly, like an ATM, the transaction fees can take a big chunk out of the transaction, with 10-15% fees not out of the norm. One of Web3’s larger use cases is the borderless transaction. Even with gas fees, the costs of sending money from one wallet to another. Whether the other person is in a first world country or somewhere in Africa, tools exist to keep fees incredibly low compared with traditional finance channels. These TradFi platforms have very little incentive to offer low fees, knowing that the person likely has little choice in how to send/receive money. Hopefully with Web3, this use case will spread far and wide, forcing even the TradFi channels to lower rates and actually compete.
These examples barely scratch the surface of what Web3 can do. The technology, even at a foundational level, continues to evolve every day. Plus, as more innovative teams work together to address our pain points, they will be able to leverage Web3’s strengths and develop new and incredibly helpful solutions.