What Web3 promises Africa – Business Daily
It is a common misconception to use blockchain and cryptocurrency interchangeably. Cryptocurrency is a blockchain scion that receives more than its fair share of attention.
Given the ‘crypto winter’ that we have entered, marked by market corrections, spectacular crashes, funding cutbacks, massive layoffs, and increased regulatory scrutiny, the spotlight is on Web3 players on whose shoulders the promise of decentralisation through blockchain and token-based economics rests.
Web3 is basically the idea of a new World Wide Web.
As with any ‘new’ infrastructure, there will arise instances where teams build products and services that have poor fundamentals riding on hype and lack of understanding, which collapse or become destabilised as the forward march toward market maturity happens.
These casualties decimate early adopters leading to skewed points of view and increased apathy to anything touching the technology. Seasons such as this offer a canvas for innovation now that the primitives are exposed, and users are better educated and aware.
The general feel from conversations had with several people investing in Web3, is that the continent has low exposure to the many ‘shenanigans’ driving risky individual and institutional behaviour at the global stage. In addition, we have good problem sets that lend themselves to anchoring solutions with actual utility. Beyond speculation, only true utility creates long-term value.
We should view any interaction with blockchain-based solutions through this lens. Where then can we find possible relatable use cases that also allow the abstraction of complex backends into products or services that the majority can easily use?
Remittance is an obvious one. Moving money around the world is an expensive affair. There are many corridors where blockchain-based solutions bring much-needed efficiency, transparency, and lower costs.
The exchange of personal data for free access to platforms turns the cogs of digital advertising where audiences are commercialised. Models exist that allow this benefit to be realised by individual users directly while leaving a healthy bottom line for the mediating platforms at scale.
Assets grow income. The challenge is mustering enough to access assets that are also liquid. Blockchain technology allows for fractional ownership of assets. Once fractional and fungible the applications are limitless.
There is a case for ownership of capital-intensive or asset-heavy utilities that fulfill the need for easy liquidity in alternative markets that also use the same stack. Innovative and sustainable products, services, and business models will rise and shine through this downturn.