3 unobvious ways that Web3 could completely change ownership
Before I get into the ‘why’, though: some perspective. I also remember that, almost 10 years ago, there was a lot of talk about the sharing economy. Sharing was becoming “the new owning”. Access would become the focus, not assets. People no longer wanted the DVD. They wanted the movie. They did not want the car (which remained unused for about 85% of the time in their garage). They just wanted mobility.
Probabilities, not predictions
The Big idea behind that was that sharing in the digital age would never result in less, but always in more. You can share ideas, music or pictures without them loosing value. To the contrary. You could even share non-digital assets like your home or your car via platforms and get money for that in return. This new paradigm was supposed to have major implications on consumer behaviour, on companies and even society as whole.
As with many technological evolutions – platforms in this case – there was an almost religious belief in how this would completely transform the world. Some made it sound as if we would end up living in some sort of near-communist utopia with all the advantages for the individual and a lot of adaptation needed for companies. And it did change things, especially for certain industries like the music and movie sector. But, today, many people still own cars. And houses. Or power drills. And they also still go to hotels, because Airbnb is not always much cheaper that the cheapest (decent) hotels.
Above all, life did not get any cheaper or more affordable because of all this. The power of the user did not increase, nor did that of corporations decline. Mostly because of data manipulation, market dynamics, a pandemic and geopolitical events like wars. But also because the platforms we used for sharing grew exponentially because of positive feedback loops and because they were far from innocent.
My bottom line is this:
Utopian beliefs coupled to new technologies rarely come true.
This was not the case for the initial idealist discourse around the internet, social media or the sharing economy. And it will probably not be true for Web3 and the metaverse, at least not in the way we are talking about it now. It is very hard to look ahead and predict the impact of a new technology. Just look at it this way: in many ways, new technologies are like brands, which need solid marketing strategies to break through. It’s pretty normal that the providers of this technology and all the adjacent partners and suppliers will spin some extra positive tales around it to push their further adoption, even if they (probably) don’t know yet what the real impact will be.
So, we have to keep both feet on the ground when it comes to predictions around new(ish) technologies. At the same time, it also really does make sense to follow what is happening in that area and think about what it might mean for our future. But in case of the latter, talk about potential. About possibilities. Probabilities, maybe. And always stay humble.
So, for me, these are the possibilities of Web3 when it comes to changing the concept of ownership:
A power shift
One of the biggest and most obvious (sorry, the title of this piece should probably have been “Two unobvious ways that Web3 could completely change ownership, and one obvious” but that seemed a bit complex) stories around Web3 is how a change in data ownership - from the Web2 platform to the user - will also result in a major power shift from platform to user.
For those of you unfamiliar with the evolution from Web2’s platform economy to Web3’s ownership economy, here’s a short recap: Web2 platforms like Meta, Google, Amazon, Uber and TikTok (still) have full ownership of the data of their users. The story they use is that this allows them to offer more personalization to users. Many, however, feel that this personalization is only used to sell (more) and very rarely to offer more value to the user. No matter what you believe, I think we can agree that the balance is definitely off.
Web3, then, is supposed to return data ownership back to the user and thus empower them to choose what they do with it (share it with companies or not) or even allow them to make money. The latter is supposed to happen via micropayments: where users could receive a very small amount of money if they open up their data (eg. for medical research) or even share ideas or posts.
I think that the idea behind that is absolutely beautiful and I truly hope that it will become reality. But I also have thoughts.
Number one. There is, again, a very strong focus on money as a currency and we all know that money truly is not the great equaliser:
- First of all, the place that would hold (keys to) all of a user’s data, assets and identity is supposed to be a cryptocurrency wallet like MetaMask, Venly or TrustWallet… (unless you would use a Solid pod, but then we would be talking about Web 3.0 or the semantic web which is a different thing. This might help to make you less confused.)
- Second, the concept of micropayments adds even more focus on monetary value than before and I’m not sure if that will have a beneficial effect. Companies used to pay platforms like Facebook for user data. Or the platforms like Amazon used it for themselves to sell more. What we will now get is users selling data to platforms who will sell it to companies who will use that to sell more to users. Not sure if that will restore the power to users in the ways that people are currently talking about. It might. But I wonder.
Number two. I’m not sure that power will indeed be decentralized towards the users. First of all, companies will probably find new ways to convince users to offer them their data. Users might get more value in return for them (monetary or other), but the underlying power dynamics might not change as drastically as we might want them. Also, even if the Big Tech data giants might have to give up some of their power, we’ll probably get new category kings like metaverse platforms or cryptowallet providers.
Will Web3 data ownership trigger a massive change? I think it might. But maybe not in the highly idealistic way that people are talking about right now.
Another interesting part of the Web3 ownership story are NFTs. The talk at Christie’s during our Web3 tour in London made me realize that. One of the speakers was explaining how NFTs are basically pieces of “if this …then that…” code that can even be programmed to change. And that is very different from other virtual products which are static in nature. If you buy a song, a movie, a book, concert ticket, they will never change, but an NFT could.
For now, people are mostly talking about how smart contracts are adding services on top of virtual NFT goods: like loyalty programs that are added to art pieces, as in the case of the Kings of Leon. But smart contracts could also change the NFT asset itself and that could hold enormous potential.
One of our speakers at Christie's, for instance, told us that she had bought a visual that changed along with the seasons. A gimmick, of course. But what if you could buy the concept of "the most popular virtual dress in Asos" as some sort of subscription NFT for your avatar, where your attire would change along with fashion trends? Products could become fluid, adapting to their context, which is a truly fascinating idea.
Another speaker on the tour talked about how users could buy and then change their own digital assets in the metaverse (yes, not all metaverses are Web3, but many agree that they might co-evolve into that direction and converge). For instance, you could buy a piece of property in Decentraland (which is a decentralized Web3 platform) and then completely redesign that. Of course, for the moment, this can only be done by coders and graphic designers, but at some point, the general public might also be able to do that. Just think about how connecting a Dall-e 2-like graphical program with a metaverse could work in that aspect.
If you don’t know about Dall-e 2, check this video and you’ll see what I mean:
As a side note: this fluidity could also be misused in very dark ways. An NFT could be sold and then programmed to change owners after a month. That would not be a problem if that temporariness is part of the deal but a huge one if not.
Another popular part of Web3 seems to be fractional or micro-ownership. One of the Christie’s speakers mentioned how a Da Vinci painting could potentially be owned by a very large group of people through a Decentralized Autonomous Organization or DAO.
If you don’t know what a DAO is, read this article or check this video:
“Why would anyone even buy 1 millionth of a Da Vinci?”, you ask? Well, according to Antoni Trenchev, Co-Founder of Nexo, they could then put the painting in a museum and then get (micro)revenue from that. Personally, I tend to side with Irra Ariella Khi of ZAMNA (also a speaker on the Web3 tour) who referred to DAOs of suffering from the “too many cooks in the kitchen” syndrome: it might make decision making a lot more complex and slow it down. For instance, in this particular Da Vinci case, some people might want to put the painting it in a museum and others might want to store it somewhere where air and light do not damage it, etc.
Unless perhaps the purpose behind the DAO is very clear. People who might buy one part of a Da Vinci could have a very different goal: they might be art lovers, they might want to preserve the piece, they might do it for the prestige, or for the money… But what if you don’t focus on what the DAO owns, but on the why? Maybe a very large group of people could buy otherwise too expensive shares to huge multinationals and then force them to become more sustainable? Of course, people could of course have very different ideas about the “how” of that story. Let’s say it’s an oil company. Some might want it to pivot slowly into different forms of energy. But others might just want to put it out of business forever. However, what if you would automate the “how” of that purpose too? Yes, there are a lot of questions here, but I think this micro-ownership could really mean something one day.
So that’s it for now. Let me know in which other ways Web3 might change ownership, if you have any other ideas. These are really interesting times for the new internet that Web3 might be: full of possibilities, experimentations, theories and convergence with other technologies. And I’m very curious about how it will finally pan out.