The True Value of Web3: You Can Take Your Toys and Leave

Personal Perspective: The opinions expressed in this analysis are my own and may not align with those of CoinDesk, Inc. or its stakeholders.

In Roblox, almost every element is the result of a player’s creativity, yet the creators hold minimal rights to their creations. Though creators retain ownership of their user-generated content (UGC), they grant Roblox an extensive, royalty-free license. This license allows Roblox to utilize, modify, publicly perform, and distribute that content on a global scale. Even if a creator decides to leave the platform, Roblox retains control over all content generated during their tenure indefinitely. This arrangement restricts creators’ potential earnings and control over their intellectual property (IP), and it makes it challenging for competitors to compete as creators cannot transfer their work to alternative platforms.

In essence, Roblox resembles the Hotel California; creators are free to sign off whenever they wish, yet finding true departure proves elusive.

Web3 advocates consistently emphasize the significance of digital property rights because without them, users are bound to the centralized platforms of Web2. These platforms accumulate all the content, creations, achievements, and communities that users build, effectively making it difficult for them to depart and start anew elsewhere. The more value a creator adds to Roblox, for instance, the more challenging it becomes for them to leave. This situation underscores the unfairness of centralization in the digital world and highlights the necessity of an internet where all users possess the freedom to take their belongings and go whenever they choose.

From its inception, blockchain has been pitched as a revolutionary solution offering individuals greater autonomy over their digital assets. Early taglines like “Be Your Own Bank” emphasized its financial implications, specifically the ability to personally manage and transact with digital currency. However, at its core, the blockchain movement is about empowering users to exercise control over their online possessions – be they money, personal data, or virtual items such as an emoji poo hat on Roblox. This user-centric approach extends beyond banking and aims to redefine ownership of various digital assets on the web.

From my perspective as a researcher studying the digital landscape, Web3 may seem like a complex and abstract notion for many internet users who have primarily experienced the web within the confines of Web2 environments. The advantages that come with Web3 often go unnoticed by this population. However, it’s essential to acknowledge that Web3 has yet to effectively communicate these benefits.

In the realm of video gaming, proponents of Web3 issue a cautionary tale: should publishers terminate your account or discontinue your favorite game, you may lose access to cherished in-game items such as skins or weapons. However, this scenario is unfamiliar and unengaging for most gamers. So far, there’s a limited collection of compelling stories that illustrate how Web3’s openness and flexibility can enhance user experience beyond what we currently enjoy online. Consequently, we haven’t witnessed mass protests from Roblox users clamoring for their digital rights.

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In the envisioned Web3 ideal, Farcaster serves as a compelling illustration of what a decentralized social experience could resemble and convey. Recently, the integration of Farcaster Channels into the protocol was announced. Previously, these Channels, similar to subreddits on Reddit, existed only within Warpcast, the most widely-used Farcaster client. Now, with Channels becoming on-chain and sovereign like Farcaster accounts, the communities established in these Channels will be owned by their creators, rather than being subjected to the control of any singular platform. This shift towards on-chain User-Generated Content (UGC) signifies the contrast between Web2 and Web3 mindsets. In Web2 environments like Roblox, value is amassed through barriers that hinder users from leaving. Conversely, platforms such as Farcaster in Web3 enable users to join and depart at their leisure, providing them with an unprecedented degree of autonomy, liberty, and freedom on the internet.

In the world of Web3 games such as The Sandbox, Pixels, Avalon, Downstream, and Pirate Nation, where it’s easy for users to switch between platforms, the key lies in creating enticing incentives that keep communities engaged and investing in their virtual economies voluntarily. This calls for a shift in competitive strategies compared to the Web2 era. Some platforms may resist this change, using every means possible to retain control over their users. Others will adapt, recognizing that an open system can yield greater value instead of less. Regardless, by the time users come to understand the true advantages of Web3 – the freedom to move and exchange value effortlessly – it’ll be the only viable option left on the table.