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Web3 vs Web2

fredwilson
fredwilson
0xB833
October 27th, 2021

Now that we are beginning to see what consumer applications are like in the decentralized web (web3), it is interesting to compare that to what consumer applications are like in the centralized web (web2).

It became clear early in the 2000s that the big opportunity in the web would be to build large networks of engaged users. That was USV’s initial web2 thesis:

USV in 140 characters: invest in large networks of engaged users, differentiated by user experience, and defensible though network effects

— Brad Burnham (@BradUSV) June 8, 2011

And the way many/most of those networks were built was by delivering single user utility day-one and then building out network effects around that utility.

Chris Dixon called that “come for the tools, stay for the network” in this blog post.

We are seeing a different go-to-market action in web3.

Most consumers start with the token/asset and go from there. Initially, it was Bitcoin and you’d store it at Coinbase. Then it was Ethereum and you’d stake it. Then it was a Cryptokitty and you’d sire it. Then it was a TopShot and you’d collect it and trade it. Then it was a CryptoPunk and you’d make it your Twitter avatar. Then it was an Axie token and you’d use it to play Axie Infinity. I could go on and on but you get the idea.

And what is most interesting to me is that these assets that you start with don’t need to stay in the networks you first use them in. You can move your Bitcoin to your ledger wallet. You can pool your Ethereum on Uniswap. You can list your CryptoPunk on OpenSea. You can use your Axie token to buy a car.

Which leads me to believe that the go-to-market action in web3 is:

Come for the assets, stay for the experience.

I shared that on twitter yesterday and putting it here today.

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