By Phil Ingram, Founder & CEO
I posit the answer is no. The productisation of tokens over problems is the primary reason the Web3 industry failed to gain significant traction outside the bubble and created such a negative image.
In recent years, the average Web3 “product” is a token launch with a mythical future utility wrapped around it in a marketing campaign. Given the state of things right now, I hope those days are over.
I say this because if you remove speculative crypto from the equation, you are left with one of the most transformative technological developments since the dot com boom (and I am so old, I was part of that too!)
If you left tokens entirely out of the equation, you might recognise where blockchain tech can solve or help solve real problems in the real world.
Here are some examples:
1. Supply Chain Management: Blockchain enables transparent and immutable supply chain systems, allowing stakeholders to track and verify the origin, movement, and authenticity of products. This approach doesn't necessarily require a token; instead, the focus is on utilising blockchain's decentralised and tamper-resistant nature to enhance trust and transparency within the supply chain.
2. Voting Systems: Blockchain-based voting platforms can provide secure and transparent elections, ensuring the integrity of the voting process. By leveraging blockchain's characteristics, such as immutability and distributed consensus, these systems can enhance trust and eliminate fraud without needing a token.
3. Intellectual Property Rights: Blockchain can help establish proof of ownership and time-stamping for creative works, patents, and other intellectual property. This genuine use case for NFTs enables creators to protect their rights and prove originality without relying on a token-based model.
4. Decentralised Identity: Blockchain can create self-sovereign identity systems where individuals control their personal data and selectively share it with trusted entities. Such systems can enhance privacy and security without requiring a native token to set it up.
5. Notarisation and Time-stamping: Blockchain can provide a decentralised and tamper-proof mechanism for notarising and time-stamping documents or transactions. This is valuable in various domains, such as legal contracts, academic certificates, or audit trails, without needing a token-based incentive model.
6. Last but not least (because that is what we are doing at Meed), Loyalty. Web3 technology opens up a wealth of opportunities in loyalty - intelligent and programmable rewards, interoperability so that multiple businesses can link up to create greater addressable audiences, and the ability to target by behaviour rather than an email address, which allows for greater campaign opportunities.
Back to tokens…
When the starting point of any new enterprise is, let’s launch a token, you inject all sorts of problems:
1. Speculation and Volatility: Tokens are investment assets, no matter what the white paper says. They are all subject to speculation, price volatility, and market manipulation. This sidelines any real-world problem-solving a product might do, meaning most investment funds are spent on influencers rather than reaching potential customers.
2. Regulatory Challenges: This chicken has made its way home to roost, an own goal of epic proportions, built on a flimsy bed of pre-launch legal opinions purchased from back street lawyers in Seychelles and the British Virgin Islands.
3. Misalignment of Incentives: When tokens become the primary focus, the actions of participants are driven more by greed for gains rather than the project's stated purpose. Crypto speculators are not the world’s customer base.
4. Perceived Complexity: Token-centric Web3 projects introduce additional complexity and barriers to entry, as users need to understand and acquire tokens to participate. Blockchain as the on-ramp will never be mainstream, at least not how it works now.
Tokens are to the blockchain what Excel is to a PC. It’s one application that runs on it. But with a Turing complete language at your disposal, smart contracts can do so much more.
Something went wrong, and we all got greedy and came up with almost every flimsy story we could serve as an industry to sell more tokens.
Let’s get back to recognising problems - does anyone remember product-market fit? - and applying decentralised technology, transparency and immutability where it makes a difference and allows us to elevate solutions for the real world.
We are doing that with meed, built entirely on Web3, and not a token in sight.