Legacy Brands and the Rise of ‘Fake’ Web3 Solutions
Web3 commerce, built on blockchain technology, has been touted as the next big thing in the world of e-commerce. However, according to Justin Banon, Co-Founder of Boson Protocol, many brands are dressing up their Web2 businesses as Web3 solutions, causing a divide between ‘fake’ and ‘real’ Web3.
Banon believes that Web3 commerce has the potential to tap into the multi-trillion-dollar market of real-world products by integrating them on the blockchain. Despite recent media attention and market downturns affecting the reputation of Web3, Banon argues that it remains a revolutionary technology recognized by brands and consumers.
However, Banon warns that most of the current applications claiming to be Web3 are not authentic. Brands have integrated blockchain technology, including non-fungible tokens (NFTs), but have not fully embraced the fundamental principles of true Web3.
He highlights the concept of ‘Web3 Washing,’ where brands fail to benefit from the unique features that Web3 offers. True Web3 solutions allow for programmable assets with hard property rights, interoperability across open protocol standards, and the seamless flow of tokenized assets across the Web3 ecosystem.
From a consumer perspective, Web3 commerce offers protection against economic exploitation, data misuse, and monopolistic practices. Banon predicts that as the next bull run unfolds, the crypto community will once again emerge as an affluent and financially active demographic. These consumers will choose real Web3 products and drive brands to implement genuine Web3 solutions.
Banon points out that current physical ‘Web3’ commerce implementations often operate in a Web2, centralized manner. He cautions against the use of NFTs as mere promises of redeemable physical items, comparing them to fiat banknotes that can be vulnerable to rugpulls. Despite recent proposals like OpenSea’s redeemable standard, Banon argues that these solutions fail to address the core issues.
He draws a parallel to Clayton Christensen’s book ‘The Innovator’s Dilemma,’ where established companies fail to adapt to disruptive technologies by overlooking the changing needs of a rapidly growing user base. Legacy sellers often lack a deep understanding of authentic Web3 commerce, while many customers may not fully grasp its nuances. Additionally, there is a burgeoning industry of Web3 agencies, consultants, and marketplaces promoting Web2 models as Web3 commerce.
The challenge for sellers lies in developing genuine solutions for physical Web3 commerce. Banon suggests that alliances with authentic Web3 protocols can help overcome this challenge.
As the divide between ‘fake’ and ‘real’ Web3 solutions becomes more apparent, it will be essential for brands to embrace the true principles of Web3 commerce to reap its benefits fully. The next bull run is expected to separate the authentic Web3 companies from those merely dressed in Web3 attire.