It should be pretty clear by now that Web3 is on its way. You don't have to like it, and you certainly don't have to love it, but you should be prepared for it. Those who are prepared for it stand to reap the most gains. In fact, there are three types of entrepreneurs I believe will profit from Web3, and all three of them are laying the groundwork right now.
Introduction to Web3
Before I get into the meat of the subject here, allow me to give you a brief introduction to Web3.
Web3 is a catch-all term for the next evolution of the World Wide Web, which will incorporate blockchain technology and cryptocurrencies to make the Web more decentralized. open, fair, and free. The term "Web3" was coined by Ethereum Co-Founder and Polkadot Founder Gavin Wood in 2014.
Web3 builds upon the groundwork already laid during Web1 and Web2. In Web1, the Web was static. It was decentralized in that anyone could log on and build a website using the tools at their disposal, however, Web1 was read-only. It wasn't interactive.
Web2 made the Web interactive. People began building websites that allowed users to generate content. The problem is that users create the content while the platforms on which these users generate content makes the lion's share of the revenue. In some cases, they make all of the revenue. This creates a huge imbalance between the creator and the platform.
On the one hand, the read-write nature of Web2 benefits creators by giving them a place to create. In Web1, their only option was to build their own website if they wanted to be a creator on the World Wide Web, but everyone didn't know how to do that. Toward the end of the 1990s, platform builders changed that by creating platforms where anyone could create an account and produce content. The end result is that, now, we have a Web full of walled gardens and internet siloes. I talk about these issues in more depth in my book Web3 Social: How Creators Are Changing the World Wide Web (And You Can Too!).
In the last few years, Web3 developers have taken certain steps, building upon the success of the first decentralized peer-to-peer money system, bitcoin, and have begun creating decentralized tools that allow creators to build their own platforms, monetize their own content, and go direct to their fans without the assistance of walled gardens and siloes.
Welcome to the emerging Web3, the read-write-own phase of the Web. Now let's talk about the three types of entrepreneurs who will profit from Web3.
Type 1: Decentralized Application (dApp) Developers
Naturally, if Web3 is going to improve upon the systems of Web2, there needs to be someone who is doing the building. Just as developer-entrepreneurs were the leaders in Web2, they'll be the leaders in Web3. The difference is that Web3 developers––at least the ones worth talking about––are building decentralized apps (dapps) as opposed to Web2 developers who concentrated their efforts on centralized applications.
A dapp is an application that facilitates the peer-to-peer content economy that may incorporate blockhain technology, cryptocurrencies, and distributed computing assets.
Dapp developers are the backbone of Web3. Without them, there would be no Web3. The ever-growing ecosystem of Web3 applications means that developers have more opportunities than ever to build dapps that are useful, fun, and profitable for all. Dapps can fall into several different categories that include:
Opportunities about for dapp developers in these categories, and much more. Developers can work directly on blockchains as well as on the dapps that are powered by the blockchains. As of this date, the top blockchains ready for your development include:
Ethereum - Ethereum is still the top blockchain for dapp and smart contract development.
Polygon - Polygon is an Ethereum alternative with low gas fees, high transaction speeds, and a growing ecosystem of development opportunities.
TRON - Next to Ethereum, TRON ranks second in total value locked (TVL), according to CoinMarketCap.
BNB - BNB is Binance's blockchain and previously called Binance Smart Chain. It is currently ranked third in TVL.
Arbitrum - Arbitrum is the leading Layer-2 Ethereum solution.
Optimism - Optimism is another Ethereum Layer-2 solution with lower gas fees.
Solana - Solana has had some issues but is still a Top 10 dapp development blockchain.
Hive - Hive is way down the list in CoinMarketCap's rankings, but the blockchain recently launched a free Hive Development School to help developers build great dapps for the blockchain.
Dapp development is a growing field. The developers who build great dapps today will have increased income opportunities during the next crypto cycle.
Type 2: Non-Fungible Token (NFT) Creators
Non-fungible tokens (NFTs) have been around for a long while. I believe they've got a bright future ahead of them. Essentially, these are unique crypto tokens that are not interchangeable, and they can exist as gaming assets, digital art, marketing collateral, literary content, audio and visual content, and more. I'm particularly excited about the burgeoning literary NFT market.
NFT creators have the ability to take their creations direct to their fans, monetize their content in creative and unique ways, and protect their identities as well as their intellectual property. Again, I talk about this more in depth in my book Web3 Social.
Content creation in Web3 need not be all about NFTs. Hive allows content creators to monetize their content without NFTs. Several other Web3 social media platforms do the same. But NFTs offer creators a way to monetize their content multiple times with ongoing opportunities for monetization. That's because fans can become owners of content assets created by the creators. As collectors, they can turn around and sell a piece of art, a Web3 gaming asset, or a literary NFT on the secondary market, earning a return on their investment as well as creating additional revenue for the creator.
The additional revenue for the creator consists occurs because the creator, at the time of creation, can designate her percentage of return when the NFT sells on the secondary market.
Platforms that offer NFT opportunities for Web3 creators include:
OpenSea - OpenSea is a multi-chain NFT marketplace that gives creators a place to offer their creations to ready and willing collectors. NFTs can be bought and sold on Ethereum, Arbitrum, Optimism, Polygon, and Solana.
Rarible - Rarible allows creators to sell art, other collectibles, and video game assets.
Magic Eden - Magic Eden began on the Solana blockchain but now also operates on Ethereum.
Objkt - Objkt sits on the Tezos blockchain and offers low fees for creators and collectors. Poetry NFTs are very popular on Objkt.
Mirror - Mirror is a popular blogging platform often referred to as a Medium alternative. Unlike Medium, however, Mirror allows creators to offer their content as NFTs without paying gas fees on the Optimism blockchain. Collectors pay the fees, which are usually quite low, and can resell them on the secondary marketplace at OpenSea. Mirror NFTs can also be used as token-gating assets for communities.
Paragraph - Paragraph is a Substack alternative that allows creators to offer their newsletter editions as NFTs on the Polygon blockchain. Creators can also offer token-gated content on the platform and embed NFTs from other website properties such as Mirror and OpenSea.
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Type 3: Decentralized Finance (DeFi) Entrepreneurs
Decentralized Finance (DeFi) applications are dapps that use technology, primarily blockchain technology, to decentralize the highly centralized financial ecosystem of the world. DeFi entrepreneurs generally fall into three categories:
Builders and developers
Financial product users
In each case, DeFi opportunities offer entrepreneurs unique and creative ways to legally build and protect wealth without using the centralized products and institutions of the past. This often includes yield farming, cryptocurrency staking, decentralized exchanges, decentralized social media, crypto securities, stablecoins, crypto lending, and more.
DeFi entrepreneurs seek to use cryptocurrencies and blockchain dapps to increase their incomes, build their wealth, and protect their wealth. As the DeFi ecosystem becomes more sophisticated and mature, there will be increased opportunities to earn crypto through these dapps.
CoinMarketCap lists the following tokens as the top DeFi tokens by market capitalization:
Avalanche (AVAX) - Avalanche is an Ethereum alternative blockchain that offers fast and scalable smart contract development.
Dai (DAI)- DAI is one of the first-to-market collateralized stablecoins.
Wrapped Bitcoin (WBTC) - Wrapped Bitcoin is an ERC-20 token on the Ethereum blockchain that represents ownership of bitcoins on the Bitcoin network. Wrapping bitcoin on Ethereum allows DeFi entrepreneurs additional liquidity and trading options.
Chainlink (LINK) - Chainlink facilitates cross-blockchain data transfers easily using smart contracts and oracles. It's also been used for insurance products.
Uniswap (UNI) - Uniswap is one of the most used decentralized cryptocurrency exchanges on the market.
Internet Computer (ICP) - Internet Computer Protocol has the ambitious plan to recreate the internet to be a decentralized network of apps, websites, and DeFi products. ICP allows anyone to build on the Web using the cryptocurrency without relying on Big Tech. Of course, it's funded by some of the major Big Tech funding icons such as Andreesen Horowitz.
Lido DAO (LDO) - Lido DAO is a decentralized autonomous organization (DAO) whose members vote on using the token for establishing parameters for liquid staking.
The Graph (GRT) - The Graph is an open protocol that allows anyone to build blockchain-based data graphs.
Fantom (FTM) - Fantom is one of the up-and-coming blockchains powering DeFi dapps and digital asset smart contracts.
Rocket Pool (RPL) - Rocket Pool is a staking pool for ETH 2.0.
DeFi dapps can fall into several different categories beyond those listed above. Linen App, for instance, is an alternative savings app that provides a non-custodial wallet for using USDC to the Compound liquidity pool on Ethereum through one's personal bank account. MetaMask and Phantom are browser-based wallet extensions that allow users to manage their digital assets. There are also DeFi dapps for providing insurance coverage, margin trading, predictive markets, payments, and asset tokenization. The more specific a DeFi dapp is its use cases, the more likely it is to find a market willing to use it.
Decentralized finance has emerged as one of the most important aspects of Web3 and DeFi entrepreneurs stand to be some of the biggest profiteers of the emerging Web.
Conclusion: Embracing Web3 as an Entrepreneur
Web3 entrepreneurs come in many different shapes and sizes. Whether one is a developer, a creator, or a financial wizard, opportunities are increasing. Now is the best time to get started with your Web3 entrepreneurial adventure.
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