I work in crypto. One thing that gets thrown around a lot is this idea of onboarding a billion people to crypto. There’s a lot happening “on-chain”—communities, platforms, applications—that is available for innumerable people to participate in. And much of this is already changing commerce as we know it. The collapse of centralized exchanges aside, more brands are coming aboard and finding innovative ways to extend real life into the metaverse—open worlds and games that are built on blockchain technology. From Vayner Sports creating new experiences in sporting events to Starbucks upgrading their loyalty program, more and more brands are finding their way into web3. And while I’m excited about this, the simple fact is that for anyone to truly involve themselves in web3 and decentralized finance, there are a number of hoops to jump through as they learn to navigate and participate in the space.
As such, web3 isn’t ready for a billion people.
Exhibit A: I have tokens sitting in a liquidity pool on one network, or blockchain, that I moved there from another network, or blockchain. Let’s call the current blockchain I’m on “Polygon,” and the original blockchain “Ethereum.” Because why the fuck not? That’s what they’re actually called. Anyway, in order to move the funds over, I had to use a bridge: visit the bridge’s web app, connect my wallet, determine the tokens and the amounts of each, and then submit the transactions. Once my funds were bridged, I had to visit the finance app’s web app, connect my wallet, deposit my tokens, and then stake the LP tokens I was given in exchange for my tokens in order to gain a larger return. And this is a simple transaction.
Now, if you have absolutely no idea what the fuck I’m talking about, that’s my point. This shit isn’t simple.
I think for security reasons, much of this is necessary because you are solely responsible for your funds. If you do crypto right, the only use you’ll have for a centralized exchange is to change fiat for crypto—what we call “onramping”—and changing crypto for fiat—what we call, you guessed it!, “offramping.” Decentralized exchanges and liquidity pool providers do not hold custody of your tokens the way banks will hold custody of your fiat. Brokers take your fiat that’s stored in the bank and deposit and lend it elsewhere while you’re not using it. And the bank can cut off your access to your fiat at any time at the behest of another legal entity. Decentralized crypto protocols don’t do that. You are the one in charge of moving your tokens around. As a result, many of these protocols undergo stringent scrutiny of their smart contracts by numerous developers and auditors.
However, regarding self-custody of funds, that's all a whole other blog post for another day. Perhaps.
The main idea is that this shit isn’t simple, and it shouldn’t be this complicated to do everything on the blockchain. But it is, and we’re working on it. Eventually, I think much of the process will be abstracted, though we have a long way to go. As things currently stand, however, we are not yet ready for a billion people.
As many like to say in this space: “It’s still early.”
