Web3's Ascend in Mainstream Industries: Potential and Challenges Explored
Summary:
The article discusses the growing incorporation of Web3 in mainstream industries with a focus on nonfungible tokens (NFTs), blockchain, and cryptocurrency. It shares insights from Kadan Stadelmann (CTO of Komodo), Bradley Allgood (CEO of Fluent Finance), Brendan McKittrick (founder of Aerobloc), and Pat White (CEO of Bitwave). While they acknowledge its potential, they warn about hastily diving into it without a strategic plan. Some industries have successfully adopted Web3, like music and gaming, but its overall effectiveness in mainstream industries is still under consideration. For broader adoption, especially in finance, a 'gold standard' medium of exchange that bridges conventional and on-chain ecosystems is needed.
Web3 technology is making significant strides in traditional sectors, with expanding business models focused on nonfungible tokens (NFTs), blockchain, and cryptocurrency. However, it's still uncertain whether it's truly enhancing conventional industries and products. A study by Coinbase in June showed that over half of the top 100 Fortune 500 U.S. companies have embarked on Web3 ventures since 2020 began. Approximately 60% have either been in the initial phase or have already launched. It showed that among the Fortune 500 executives who are acquainted with blockchain, 83% report their firms have current initiatives or strategic plans in place.
Pat White, Bitwave's co-founder and CEO, conversing with Cointelegraph, thinks Web3 has effectively started merging with conventional businesses. He stated that its potential to propel innovation across many industries is just being seen now, especially in fields such as finance and healthcare. Notable applications include reducing intermediary costs, enhancing data consistency, supply chain lucidity, strengthening cybersecurity and creating novel customer interactions. Some smart contracts have been used in healthcare settings for efficiency improvements, with a few companies experimenting with blockchain for storage and management of medical records. However, this is still in its preliminary stages, and ultimately its success will depend on whether Web3 can provide more effective systems than those already operating.
Several prominent businesses have begun to incorporate Web3. This includes Starbucks with its NFT-based rewards scheme, Goldman Sachs and Microsoft's ongoing development of new blockchain networks aimed at financial institutions, and Elon Musk's teasing of potential crypto payment options on X (formerly Twitter). Despite this, not all companies can utilize Web3 to immediately increase efficiency. In early 2023, Porsche ran into trouble with their NFT project, which fell flat due to high minting prices and lack of functionality, serving as a warning that a careless venture into Web3 can be risky.
White stressed that undertaking Web3 based efforts should always be a strategic decision and should involve every operating department. He compared the current stage of Web3's development to the internet of the late 90s, a time of rampant speculation and companies attempting to incorporate the new technology without a clear plan. Brendan McKittrick, founder and chairman of Aerobloc, shared this viewpoint, adding that poorly executed efforts trying to cash in on the hype could serve as valuable lessons for improving future Web3 implementation strategies.
On a positive note, Web3 tech has already revitalized products within mainstream industries like music, gaming and real estate according to Kadan Stadelmann, chief technology officer of Komodo. Artists have been able to bypass intermediaries by connecting directly to their audience, players have gained true ownership and control over in-game assets, and real estate transactions have benefitted from peer-to-peer transactions and tokenization of properties.
However, Bradley Allgood, CEO and co-founder of Fluent Finance, emphasized that despite its potential, Web3 technology must meet a "trusty gold standard" medium of exchange that bridges on-chain and traditional financial ecosystems. He indicates that current Web3 integration processes can often be cumbersome and inefficient, leading to subpar user experiences. To harness the full potential of Web3, a solid financial infrastructure is required, which is currently lacking. Until there is trusted custodianship and issuance of a stable-valued asset with sufficient transparency, the mainstream uptake of Web3 may be impeded.
Published At
11/3/2023 1:01:00 PM
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