Web3 is one of those buzzwords whose use has exploded over the past ~2 years. Despite this, proponents of Web3 have yet to rally around a single cohesive vision of what a Web3 world should look like, preferring instead to describe utopian pictures of a world where crypto rules social media and everyone is identified by their ETH addresses. If you’ve ever seen “.eth” at the end of a Twitter username you know what I’m talking about.
At Pearl, we’re huge proponents of what crypto and Web3 can offer creators and social media users when executed correctly, but we’re also acutely aware of how challenging educating the broader population on technologies that are still nascent can be. This is especially true against the backdrop of a world where crypto’s cumulative market cap has dropped by more than 60% in less than a year and scandals have rocked the industry (e.g., LUNA, FTX, etc.).
So where does that leave us? We pulled together a quick, easy-to-use guide on Web3 that explores how the advances in technology over the past couple years have enabled a whole host of opportunities for the group most likely to benefit from the advent of Web3 — content creators. This is not meant to be a thorough breakdown of the technology behind Web3, but rather an easy to follow introduction for non-technical folks who are interested in what Web3 can unlock for the creator economy.
What does Web3 Mean?
To start, we should define Web3 in its most basic, aspirational form. The core tenet behind Web3 is the idea of ownership. In Web2 (think Facebook, Instagram, YouTube, etc.) the operator of a given social network has control of all aspects of the platform. Everything from how your content is displayed and monetized to your social graph (i.e., who you follow and often more importantly for creators, who follows you) is dictated by the platform and they have the power to do whatever they want with it. This might not have been a deal breaker if the incentives of the creators and the platforms’ business models weren’t so misaligned.
The goal for most Web2 social platforms is to maximize ad dollars, which leads to feed algorithms created to focus exclusively on engagement so they can sell each ad for more dollars. This ad-driven model doesn’t reward creators for the content they create that is the lifeblood of these platforms, and results in systemic problems that we plan on exploring in future posts.
Web3 attempts to take this model and flip it on its head. Unlike in Web2, Web3 apps and protocols seek to empower creators and enable them to control the fate of their own content, social graphs, and profiles. These applications provide creators with a toolkit that allows them to more effectively monetize their content and create deeper bonds with their communities.
How does Web3 Work?
Web3 achieves these benefits by using blockchains and cryptocurrencies as implementation mechanisms, making Web3 synonymous with crypto as a whole. This narrative has largely scared many mainstream users without extensive crypto experience from taking the plunge into Web3 because the space still feels like the Wild West to many outside observers. However, there are numerous reasons Web3 apps have leaned into the blockchain model as crypto facilitates the execution of many of Web3’s guiding principles.
The tech behind Web3 operates on open source, autonomous blockchains – minimizing the need to trust centralized platforms (e.g.,Facebook, Twitter, TikTok, etc.), a key principle of Web3. Perhaps most importantly, the blockchain model also allows for seamless and instantaneous portability of a creator’s own social graph across apps. With Web3 apps built on top of a common blockchain, such as the DeSo blockchain, a user’s content and social graph can be shared across the chain (more on that below), enabling any application on the chain to build applications around this common set of data. This also facilitates a marketplace of apps in which different dApps (decentralized apps) compete on things people care about (e.g., monetization features, content curation, moderation, etc.) and results in a better user experience. Instead of creators being held captive by a large company, Web3 allows for more innovation and competition in the social media space.
Web3 Applications for Creators
While much of the above description may seem complicated, there are already a number of easy-to-understand benefits of leaning into the Web3 technologies that have already been developed. To touch on a few:
- Portable Following: One of the biggest pain points for creators to take up a new social platform is having to rebuild their social graph and having to pull their followers from their various platforms onto a new one
- Creators who start on the DeSo blockchain can build their following on any app (e.g., Diamond or Stori) and can easily login with their account through Pearl and have access to the same followers and reach
- This allows creators to try new applications without having to rebuild their communities from zero every single time
- Greater Reach: Blockchain based content not only lets creators carry-over their social graph from app-to-app, but content that is posted on the blockchain can be picked up by different apps, which drastically increases the reach any creator has.
- As an example, the reach of a post that someone makes on Pearl, isn’t limited to users on Pearl, but rather that post can be monetized across all apps on the DeSo blockchain that choose to include Pearl content in their feeds.
- For creators, this means earning tips, engagement, and followers from a much larger bases of users than just people using the same app as you. Your audience potential, instantly becomes ALL of the users on the blockchain.
- Microtransactions: Micropayments, such as dollar tips, are often limited on platforms due to transaction cuts to third parties (ex. credit card companies, app marketplaces), rendering small tip amounts useless
- Cryptocurrencies can facilitate these microtransactions for creators, which allow users to directly and seamlessly monetize the content they create
- With tips ranging from a fraction of a penny to tens of dollars, we see more people being able to tip and creators with much smaller, but more engaged followings discovering a path to monetization
- Monetization & Community Engagement: Non-fungible tokens (NFTs) ownership can help creators manage and create benefits for their community
- Owners of a creator’s NFT can be granted access to the creator’s Discord channel, receive exclusive DMs, or see behind the scenes videos available only to NFT holders, etc. as well as create recurring revenue for the creator through royalties from the resale of the creator’s NFTs. The possibilities are only limited by the creator!
What Comes Next?
Much of what we’ve discussed here barely scratches the surface of what a fully operational blockchain-based Web3 ecosystem can offer, but we hope it provides a taste of what is currently being built and what’s to come. This is why we’re so excited about what we’re building here at Pearl and being part of the broader Web3 community.
Follow along as we break it all down!