Web3 Onramps for the Next 1 Billion People
Dear subscribers, The promise of web3 is that creators and users can finally own the upside from their work because trust can be set by code. But we’re not quite there yet. Exploring web3 today is fraught with bad UX, high fees, confusing terms, and scams.
In this post, I’ll share my thoughts on:
Today’s post is brought to you by…Index Coop Index Coop is the leading provider of on-chain crypto indexes. The DAO’s mission is to create decentralized financial products that unlock prosperity for everyone by building simple yet powerful index products to provide simple, safe, and affordable access to top crypto investment themes like DeFi and the Metaverse. Index Coop already has $170M under management. This isn’t investment advice but I think the platform provides a great way for beginners to diversify into crypto. How people onboard to web3 todayWhy would a regular person care about web3? Today, I think the most common reason is: “They want to make money.” Regular people onboard to web3 as follows:
There’s a massive drop-off in each step above. How can exchanges, wallets, and NFT marketplaces provide better onramps? Exchanges: Your place to buy and sell crypto, and hopefully something moreExchanges are the closest proxy to web2. With an exchange, you:
However, many people only use exchanges to buy and sell crypto. They move their tokens to a standalone wallet to do anything else (e.g., buy an NFT). That’s why exchanges are moving down the stack. Coinbase, for example, already has 89M accounts linked to a bank or a credit card. They can upsell these 89M accounts to:
The risk with exchanges is that they’re not decentralized. It’s unclear how much adoption Coinbase wallet has and whether Coinbase’s NFT marketplace will let artists and creators earn a cut of the transaction fees. Wallets: Your web3 identity, social network, and App StoreSelf custodial wallets (e.g., Metamask, Phantom) are the closest proxy to your web3 identity. There are two problems with wallets today:
To address these problems, wallets can:
But wallets can do so much more. They can be your:
Today, wallets acquire customers primarily through other NFT projects and dapps (wallet moat = integrations). In the future, wallets will be the central hub for your web3 identity, social network, and app discovery. In case you can't tell, I'm very bullish about this product space. NFT marketplaces: Your web3 recommendation and search engineIf wallets will help drive discovery through social context, where does that leave NFT marketplaces (e.g., OpenSea)? Let’s start by asking who is the customer? Most NFT transactions come from a small handful of traders that are chasing the next flip. But marketplaces should focus on the next 1B people who can buy NFTs but don’t. Specifically, I think they should build:
NFTs will continue to grow rapidly in quantity and variety (jpegs, music, essays, titles, deeds, etc). NFT marketplaces need to solve the fundamental problem:
To put it simply, NFT marketplaces should be the web3 Google or Amazon. Dark horse candidates for web3 onrampsExchanges, wallets, and NFT marketplaces are the obvious onramps, but let’s not forget these dark horse candidates:
A better web3 onramp is comingHere’s the experience that I think will onboard the next 1 billion people to web3:
I truly believe that wallets are the closest to making this vision a reality. I’ll dive into this more in my next post, which will feature an interview with Brandon Millman, CEO of Phantom wallet. Further readingIf you liked this post from Creator Economy by Peter Yang, why not share it? |
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