Blockchain based decentralised applications have fallen into two categories,
- They create or distribute digital assets / experience / services using digital channels (think social media platforms, gaming, youtube)
- To enable more transparency when it comes to distribution of physical goods and use blockchain as digital transformation for existing workflow and institutional decisions. (think supply chain, governance)
Obviously when any technology becomes ripe for adoption there are multiple buzzwords that go around and create a lot of noise which in turn becomes hype driver. Let's breakdown the industry from pure standpoint of technical innovation it has to offer.
Web 2.0 vs Web 3.0?
- Dapp tokens can be programmed into the application, so in more traditional sense the shares of an application can be programmed and distributed to users in a predefined fashion based on the utility of the application. For example, youtube will give it's ownership to you to watch videos on it's platform, Krafton Inc. would give shares to you to play PUBG or it's other games.
- User privacy. Reports of facebook sharing data to advertising companies, or organisations collecting data and targeting customer on that basis has become norm but when it comes to decentralisation the code for smart contracts is publicly accessible and can be reviewed by any programmer, eliminating misuse of data.
- Tokens of DApps would have an extended functionality to be packaged together, collateralised , bundled and sold to investment firms, and the profits made from it would benefit the person buying / selling the tokens.
- Digital Assets, Physical Assets would be represented as NFTs and they can be sold, exchanged and bundled to fungible tokens. The DEX (decentralised exchanges already exist)
Blockchain Revolution fundamentally re-imagines an organization’s core business model, target markets, go-to-market approaches, and/or internal processes in an effort to deliver sustainable breakthrough results like profitable growth and increased market share or capitalization. It takes the most centric part of business and gives back the ownership to people that valued the project most. It is most certainly very difficult to move from a web 2.0 organisation to web 3.0 organisation but can be achieved with grit and determination.
The How of Blockchain Transformation
Once an organisation recognises the potential benefits of blockchain transformation then the question becomes mostly how it can transform itself into a decentralised organisation. Most dapps have a timeline that looks like this,
- Pre-Launch ICO for believers
- Launch community on discord and talk to your users
- Launch Product
- Keep it rocking!
Obviously this is a generalisation and I expect the order to reverse in next few months as this space becomes the norm rather than the exception.
You obviously need to understand what chain matches your vision, there are many chains that focused more on DEFI and thus have strong selective privacy for your transactions such as ZCash, Monero, Findora ... where as there are others that are more focused on NFTs such as Tezos, Zilliqa, some are focused on more on web3 and high throughput in exchange for security such as Solana , Polygon. Depending on your project and the developer talent pool you have, you need to choose the right chain.
It is important to note that many of these L1 chains are currently funding DApps to increase adoption and have massive developer grants in niche segments. There have been decentralised venture funds to fund these Dapps, the most notable one by Binance Smart Chain for 1B$.
Interesting Case Studies in production
Axie infinity - It is play to earn game, it has been known that many people in Philippines left their job to play this game as it paid more than the minimum wage in that country. It had massive influx of users and was number one NFT game in last few months. (The trend seems to decline now)
Chingari - Chingari is India based TikTok clone where creators are paid in GARI tokens and has awesome way to stake interests and bet on new and upcoming creators.
DEFI - Uniswap, Aave and PoolTogether are Defi protocols that allow loans for other tokens in exchange for collateral in one. I found PoolTogether to be most interesting of use case, it allows you to pool your money with other people and then the interest accumulated of this pooled money goes to the person determined by lucky random selection. All of this without diluting your liquidity in tokens!