What new business models will the Web 3.0 era unleash?

Original author: Max Mersch

Original title:Which New Business Models Will Be Unleashed By Web 3.0?

Translator: 0 x33

The coming wave of Web 3.0 goes well beyond the original use cases of cryptocurrencies. With the rich interactions now possible and counterparties worldwide available, Web 3.0 will enable encrypted connections to data from individuals, companies, and machines, using efficient machine learning algorithms, leading to the emergence of fundamentally new markets and related business models.

The future impact of Web 3.0 is undeniable, but the question is, in today's economy, which business model can crack the code and provide lasting and sustainable value?

This article delves into the local business models that Web 3.0 has enabled and will enable, and begins with a brief overview of the rapidly forgotten but often arduous journey that Web 2.0 has taken, leading to unexpected and unpredictable successful business models.

To create an interesting scenario for the Web 2.0 business model discovery process, let's not forget Google's release from 1998 to 2002 and then to 2004:

· in 1999, while enjoying good traffic conditions, their business model was clearly struggling. "We really didn't understand their business model," says Mike Moritz, one of their main investors, publicly. "it looked pretty bleak for a while."

· in 2001, Google's revenue was $85 million, compared with $288 million for its competitor Overture, due to the gradual decline of cpm-based online advertising after the Internet crash.

· in 2002, Google adopted the advertising model of Overture and launched AdWords Select: its own pay-per-click, auction-based search advertising product.

· two years later, in 2004, Google accounted for 84.7% of all Internet searches, with a market value of $23.2 billion and annual revenue of $2.7 billion when it went public.

· after struggling for four years, they put Google into orbit with a small modification of their business model, making it one of the most valuable companies in the world.

market

Amazon started out as an online bookstore, and no one believed it could be profitable. However, it is now a huge market for everything from gardening equipment to health food to cloud infrastructure.

Open source software

Source software development began with the amateur and idealist view that software should be a freely accessible public good.

Today, however, the entire Internet runs on open-source software, generating $400 billion a year in economic value, Github was bought by Microsoft for $7.5 billion, and Red Hat has $3.4 billion in annual revenue from Linux.

SaaS

In the early days of Web 2.0, it might have been unthinkable to deliver commercial software through the browser and make it economically viable after spending a lot of money on proprietary infrastructure. However, most B2B businesses today run on the SaaS model.

Shared economic

It was hard to believe that anyone would want to climb into a stranger's car or rent a couch to a traveler. However, Uber and AirBnB have become the world's largest taxi operators and lodging providers, but their platforms don't have any cars or real estate of their own.

advertising

While Google and Facebook may have entered a high-growth phase early on, they had no clear plans to generate revenue in the first half of their lives. However, the advertising model has proved almost too good for them, and they now generate 58% of global digital AD revenue ($111 billion in 2018), which has become the dominant business model for Web 2.0.

The emerging Web 3.0 business model

Looking back at Web 3.0 over the past decade, the original business model was often unrepeatable, unextensible, or simply an attempt to replicate the Web 2.0 model. We believe that, despite skepticism about their viability, ongoing experiments by some of the smartest builders will produce extremely valuable models in the years ahead.

By exploring a more mature and experimental Web 3.0 business model, our goal is to understand how some of these models will add value over the next few years.

• Issue underlying assets (Issuing a native asset)

• Holding the native asset, building the network

• Taxation on speculation (exchanges)

• Payment tokens

• Burn tokens

• Work Tokens

• Other model

& have spent Issue native tokens & & NBSP;

Bitcoin bears the brunt. The PoW plus the sino-japanese consensus created the first Byzantine fault-tolerant and fully open peer-to-peer network. Its inherent business model relies on its local asset :BTC, a digital token that proves to be scarce and is paid to miners as block rewards. Other companies, including Ethereum, Monero and ZCash, have also released ETH, XMR and ZEC along the way.

These local assets are necessary for the operation of the network, and their value comes from the security they provide. By providing honest miners with high enough incentives to provide leverage, the cost of carrying out an attack by a malicious actor will rise as the price of local assets rises. In turn, increased security drives further demand for money, further raising prices and values. The value generated by these local assets has been analysed and quantified over time.& have spent Holding native token assets, building a network & NBSP;

Some of the earliest companies built around encrypted networks had only one mission: to make their respective networks more successful and valuable. They eventually business model can be condensed as "to increase their underlying assets, building ecological system". As one of the largest maintainer BTC, Blockstream depends on creating value from the balance sheet of BTC. Similarly, ConsenSys has grown to have 1000 employees, for the etheric fang ecosystem construction of key infrastructure, purpose is to increase its holdings of the value of the ETH.

While this makes for a perfect combination of companies and networks, with the exception of the first few, the model is hard to replicate: accumulating enough native assets over time has become impossible. The amount of sweat it takes to start and sustain a company doesn't make sense if you don't have enough shares to achieve exponential returns. For example, it would be unreasonable and impossible for any company outside the central bank to do business entirely on the basis of holding large amounts of dollars and working to make the us economy more successful.& have spent A speculative fee model for underlying assets & & NBSP;

Subsequent business models focus on building the financial infrastructure for these local assets: exchanges, custodians, and derivatives providers. They are all built around a simple business objective -- providing services to users interested in speculating on these volatile assets. Although Coinbase, Bitstamp & Companies such as Bitmex have grown into $1bn companies, but they do not have the nature of a complete monopoly: they provide convenience and raise the value of their underlying networks. The open and unlicensed nature of the underlying network makes it impossible for companies to lock in monopolies by providing "exclusive access", but over time their liquidity and brands provide a defensible moat.& have spent Payment tokens & NBSP;

With the rise of token sales, there has been a wave of new projects in the blockchain sector based on business models for in-network payment tokens: often creating a two-way market and forcing any payment to use the project's own token. It is assumed that as the network economy grows, the demand for these limited native payment tokens will increase, leading to an increase in the value of tokens. Despite the controversy over the accumulation of value in the token model, the increase in user friction is noticeable - what could have been paid for with ETH or DAI now requires an additional exchange between the two sides of the transaction. Although the model was widely used during the token boom of 2017, its friction-induced nature has pushed it rapidly out of the forefront of development over the past nine months.Burning tokens & NBSP;

And revenue-generating communities, companies and projects that have tokens may not always be able to pass profits directly to the token holder.

As one of the characteristics of Binance (BNB) and MakerDAO (MKR) tokens, the business model that has generated a lot of interest is the idea of repurchase/token burning. As revenue flows into the project (transaction fees from Binance and stabilization fees from MakerDAO), local tokens are bought back from the public market and burned, reducing the supply of tokens, which will lead to higher prices. It is worth exploring Arjun Balaji's assessment (The Block) that The Binance token burning mechanism does not actually result in what amounts to a share buyback: because no dividend is paid at all, The "return per token" is still $0.

& have spent Work tokens & cake;

One of the business models we now see for encrypted networks is working tokens: a model that focuses on the provider of network revenue to reduce user friction at a time. Some good examples include Augur's REP and Keep Network's Keep tokens. The operation of the work token mode requires the service provider to give up/bind a certain number of native tokens in exchange for the right to provide profitable work to the network. One of the most powerful aspects of the work token model is its ability to motivate workers,In addition to providing security for the network by incentivizing service providers to perform honest work, they can also be collectively evaluated by the predictable future flow of cash to service providers. In short, these tokens should be valued based on the expected future cash flows of all service providers in the belonging network, which can be modeled based on assumptions about pricing and usage of the network.

& have spent Patterns being explored are worth a try:

Dual token model: e.g. MKR/DAI & SPANK/BOOTY, in which one asset absorbs the rise and fall of volatility in use, while the other remains stable for optimal trading.

Governance tokens provide the ability to influence parameters such as costs and development priorities, and can be evaluated from the perspective of forked insurance.

Scrip: represented as existing assets (stocks, commodities, invoices or real estate) that have a potential premium in divisible and borderless liquidity based on the valuation of the underlying assets.

Functional transaction costs: for example,Wave train of thought& have spent BloXroute and Aztec have been exploring a Treasury that charges a small transaction fee in exchange for its enhancements (extensibility and privacy, respectively).

Tech 4 Tokens: a framework for risk technologists in the blockchain ecosystem. As the Starkware team proposed, they wanted to provide their technology as an investment in exchange for replacement COINS, which would effectively create a library for all the projects they worked with.

UX/UI for protocols: for example, Veil & Guesser is for Augur, coon is for the MakerDAO ecosystem, relying on small fees or referrals & Commission.

Network-specific services: these currently include mortgage providers (such as Staked.

Liquidity provider: companies operate in applications that do not have a revenue-generating business model. Uniswap, for example, is an automated market maker in which the only way to generate revenue is to provide liquidity.

As a host of new business models emerge and are explored, it is clear that while there is still room for traditional venture capital, the role of investors and capital itself is evolving. Capital itself in the network evolved into a native asset, has a specific role. From passive networks involved in the financial investment after the network (such as work or liquidity supply), and then to direct the subjective society.in networks (such as governance or CDP risk assessment), investors will have to reposition themselves, to adapt to the new organization model, this model driven by minimizing decentralized network.

Looking back, we found that Web 1.0 and Web 2.0 were thoroughly experimented with to find the right fitThe business model that made today's tech giants. We're not ignoring that Web 3.0 will go through the same tough iteration, but once we find enough business models, they'll be very powerful: in an environment of minimal trust, both individuals and businesses will be able to interact on a whole new scale without relying on rent-seeking intermediaries.

Today, we see more than 1,000 talented teams driving the implementation of some of these models or discovering new and viable business models. Because these models may not fit into traditional frameworks, investors may have to adapt to new roles, providing jobs and capital. But as long as we see a predictable and reasonable accumulation of value, it makes sense to double it, because execution risk is getting smaller and smaller every day.

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