This is the question to 21 million bitcoins: will the Web3 revolution ever happen? In an endless winter of cryptocurrencies, and at a time when the thunderous failure of the FTX cryptocurrency exchange platform is shaking the ecosystem, we pose the debate with selected topics and a throwback to the 2000s.
Do you know the “abyss of disillusionment”? This is not a sort of existential despair à la Chateaubriand, but the destiny reserved for all emerging technology, halfway between a semi-depressive state and a healthy return to reality. This seemingly inevitable fate would occur once the “peak of exaggerated expectations” is reached, if Gartner’s famous hype curve is to be believed. And for its 2022 edition, the American consulting firm places Web3 not far from the hottest buzz, while NFTs have already begun their slide to the bottom of the hole.
A cryptographic winter that never ends
Is Web3 dead, even before it was born? We should give up on this promise of a new web, a revolution made possible by the blockchain, a “new golden age of the Internet” freed from platform control, where everyone would have control of their data, where power would be decentralized and value shared enough? Is the crypto web too good to be true? It is true that in addition to the media hysteria on the subject, 2022 was marked by a cryptographic winter that never ends …
Since its all-time high in November 2021, the cryptocurrency market has fallen by 70%. Its flagship currency, Bitcoin, went from $ 67,000 to $ 19,000 in less than a year. Over the same period, the cryptocurrency market wiped out over $ 2 billion in market capitalization. What we owe this to bear market – as traders are referring to a sustained market decline of at least 20%, dragging investor sentiment in its wake? Obviously, the geopolitical context is in question, but also the rise in interest rates, decided by central banks to try to control inflation. In September 2022, the Fed (US central bank) raised the reference rate for the fifth time this year, setting it at around 3.25%. An “increasingly expensive” money that favors safe havens, at the expense of risky assets, including cryptocurrencies. And where we see at the same time that it is not enough to escape the regulation and control of the states to escape the economic situation and monetary policies.
Of the technomania who looks alike?
And if we compare this spectacular accident with that experienced by another technomania ? It is the “back to the future” towards 2YK and its dotcom bubble that the Financial Times in an article of July 2022. The exercise is attractive, because the common points recall: the enthusiasm for a technology with revolutionary potential, called the Internet, which would allow, among other things, to escape the control of the political and economic institution, to empower people online … Sound familiar? The similarity also affects the pace and extent of events: eight months after the peak of the Internet bubble reached in March 2000, listed technology companies had lost 60% of their value, or about $ 1.7 billion …
For cryptocurrency enthusiasts, this is proof that a lasting technological revolution can be hidden behind the speculative flight. It’s hard to argue that the internet has actually found its place in our lives (to the point where the question now is rather how our lives can find theirs in this ultra-connected society, but that’s another story). It would be enough then for the actors of the crypto world to grind their teeth waiting for the thaw – or rather the “slope of clarification”, the one where applications emerge and momentum is created, and the “productivity plateau”, when technology finally finds its way. market, to use the Gartner methodology.
Concrete applications are undoubtedly what the blockchain and its ecosystem lack most. Martha Bennett, principal analyst at Forrester, specializing in blockchain and artificial intelligence, was chief technology officer for Prudential Insurance in the 1990s. In Financial Times who questions her, thinks it is too early to tell, but nevertheless observes that as early as 1995 the applications of the Internet were obvious: access to information, e-mail, etc. In October 2022, in an incriminating Twitter thread, Daniel Glazman, French programmer and former co-chair of the W3C’s CSS working group, recalled that “in 11 years, the age of BTC, the Web has revolutionized humanity’s access to information and commerce on 300 million major sites. ”
good guys vs. bad guys
Web3, metaverse, decentralization, fungible, non-fungible or semi-fungible tokens (yes, that also exists) … It must be said that concepts follow one another and accumulate, without a simpleton being able to really understand the revolution in progress, if it really exists . Although companies have long been interested in “blockchains,” no killer apps have really emerged. For Gartner, it will take two to ten years for most blockchain innovations to come of age, the time it takes to overcome technical and regulatory challenges. Some draw the analogy to cloud technologies that have taken twenty years to deploy on a massive scale.
In their note, Gartner analysts urge market observers not to throw out the crypto baby with the bathwater, and to distinguish technologies from the more or less honest intentions of those who manipulate them, also specifying: “the bad guys have always faced and experienced with new technologies, much earlier and faster than the good guys. It takes time for virtuous use cases to emerge and even more time to implement security and anti-fraud systems. ”
“Scams, time bombs and storytelling”
But the field of skeptics and antiweb3 is unconvinced and invests social media to say it. Researchers, developers, designers, academics … raise their voices to condemn what at best would be a fad, at worst a big scam. Thereby Stephen Diehla computer engineer, tweets all the bad things he thinks about the question to his 60,000 followers: “Web3 startups = fraudulent companies + time bombs”, “All play-to-earn games are scams”, “No difference significant between Bitcoin and Dogecoin. They are both advertised speculative assets whose demand is generated exclusively by the art of storytelling “… Do not throw away anymore.
Olivier Blazy, professor of cybersecurity at Polytechnique, is interested in the cybersecurity promised by Web3. Because contrary to popular belief, being based on a technology known to be tamper-proof does not protect against security breaches – poor electronic signature verification is one example … Developer Molly White accurately documents on her blog “Web3 it’s just doing great “the damage to Web3, from bugs to hacking, including embezzlement. As we write these lines, the counter on the home page shows more than 11 billion dollars lost, stolen or scammed on Web applications3.
But the ideological discourse also poses a problem for cryptosceptics. By dint of everything tokenize, we are closer to micro-ownership than to the sharing economy, as Kevin Echraghi, from the Hérétique collective, explains to L’ADN. This Sciences Po professor sees in Web3 a new iteration of the American dream, which materializes in the brilliant financial success promised to the daring parties to conquer these new territories. Not very far from the libertarian ideology, where the logic of the market applies to every place, without state intervention, which inspires so many Silicon Valley experts, such as Elon Musk or Peter Thiel …
For Scott Galloway, Web3 is nothing more than an empty technological buzzword. The famous NYU marketing professor even thinks it should be renamed “Web2.01”, indicating a concentration of power already in the hands of Web2 players. On the key issue of democratization, one can wonder about the consequences of the evolution of these “proofs”, which validate transactions on the blockchain: the proof of stake, or proof of participation – on which Ethereum has just changed its infrastructure through the update The merger – it is certainly less energy-intensive than proof-of-work, or proof of work , but it favors those who already own cryptocurrencies. For a decentralized Internet, we will have known better.
Waiting for Web5?
For Tim O’Reilly, internet legend and creator of the term web 2.0, “power will always find new ways to centralize itself. The entire history of the computer industry has been driven by a radical opening, which led to massive innovation and then its closure ”. Jack Dorsey thinks Web3 is already dead. He also believes that “nobody owns Web3. It is owned by venture capitalists and limited partnerships. »What to do then? Create the Web5, of course. The Twitter founder proposes to add Web2 and Web3, in a new project …
So is Web3 flawed by design (imperfect, imperfect, construction) or just technologically immature? At a time when the Delegate Minister for Digital Transition Jean-Noël Barrot wants to support the NFT industry with public funds from France 2030 and “master the building blocks of Web3 in order not to depend on foreign powers”, the answer to this crucial question is anything but obvious. As mentioned by Financial Times, the tools that form the foundations of our connected uses – Facebook and social networks, the mobile Internet powered by the creation of the iPhone or the cloud with, among other things, Amazon Web Services – have finally emerged long after the explosion. bubble of internet. But, regardless of whether Web3 crystallizes or not, pro and anti could very well come together on one point: so long Web2.0The time has come to help make this dream Internet come true, where everyone owns their own identity and data.
This article is taken from 2023 trend book, 20 key sectors of the economy deciphered, 368 pages. Available for pre-order now.