๐Ÿ“‘ Why it’s too early to get excited about Web3

Bookmarked Why it’s too early to get excited about Web3 (Oโ€™Reilly Media)

If Web3 is to become a general purpose financial system, or a general system for decentralized trust, it needs to develop robust interfaces with the real world, its legal systems, and the operating economy.

Tim O’Reilly explains that investments and speculations in technology do not equate to success. The lay of the land in regards to the dot-com boom was only visible years after the crash.

I like to remind people that I wrote โ€œWhat Is Web 2.0?โ€ five years after the dot-com bust with the explicit goal of explaining why some companies survived and others did not. So too, I suspect that it wonโ€™t be till after the next bust that weโ€™ll really understand what, if anything, Web3 consists of.

Associated with this, successful change occurs when it is accompanised by investment in infrastructure and robust interfaces. He uses Carlota Perez’ book Technological Revolutions and Financial Capital to explain this.

[C]onclusion of Perezโ€™s analysis is that a true technology revolution must be accompanied by the development of substantial new infrastructure. For the first Industrial Revolution, this included canal and road networks; for the second, railways, ports, and postal services; for the third, electrical, water, and distribution networks; for the oil age, interstate highways, airports, refining and distribution capacity, and hotels and motels; for the information age, chip fabs, ubiquitous telecommunications, and data centers.

For example, both Elon Musk and Jeff Bezos used their speculative stock price to invest in infrastructure.

Elon Musk has been a master at taking the outsized speculative price of Tesla stock (which at one point a year or two ago was valued at 1,500 years of the companyโ€™s profits!) and turning it into a nationwide electric vehicle charging grid, battery gigafactories, and autonomous vehicle capabilities, all the while catalyzing entire industries to chase him into the future. So too has Jeff Bezos used Amazonโ€™s outsized valuation to build a new infrastructure of just-in-time commerce. And both of them are investing in the infrastructure of the commercial space industry.

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