Hacker News Reader

Comment by 0xB31B1B | Hacker News Reader

There is no PMF in anything web3 related. Web3 is a mountain of trash. Token economics is a rebranding of ponzi economics. Really can't take seriously the investors who made a quick buck flipping trash coins and still talk their book. Web3 isn't going to zero, but its going to an industry wide marketcap of like 1B or less. Its only use cases are evading capital controls, KYC, and taxation. Decentralization writ large is not useful, it doesn't provide any interesting product benefits, and customers don't care about it.

View on HN

Usually PMF has a very simple metric: are people using your product, in increasing numbers, and talking about it? (This doesn't mean you have a business, but it means you have a product).

But with "web3" so many projects had insane usage but only because the promise was get-rich-quick. The product itself had no value.

The usual signal was distorted.

Users and pumpers are not the same. The most successful web3 project (helium) is a horrible failure. No one using the network, node owners being paid Pennie’s per month, and the whole product/company could have been tested and developed at 1/10 the cost if they built using a normal centralized model instead of creating a token.

Wireless communications has terrible geographic distribution.

90% of helium access points will be installed right next to other helium access points in places that are crowded with early adopters. If there are a lot of them they will interfere with each other in some places, but almost everywhere there will be no service.

If there wasn't network planning as in a cellular network you would need very strong market based mechanisms such as people getting paid 100x as much to put up access points in areas without coverage, being charged to join the network if they are in a place that has too many access points, etc. Even cellular networks have awful economics if you demand 100% coverage, they look cheaper than fiber when you have 70% coverage but somewhere in the 90%'s they become expensive again. Big Telecom wishes it could get telematics hardware in all automobiles to add hundreds of millions of subs but it does not have the desire to make the investment to get sufficient coverage for those things to really work.

The problem i see with web3 as it was is that projects would show up with zero value and all speculation. I think many people just assumed it’s a magic black box that makes you money.

After all the scams of the last few years, I think that in 2023, folks will start approaching these projects more cautiously, only investing when the thing actually delivers some value.

I don’t know what a “valuable” (in terms of what it does, not token value) really means in web3 yet, though it seems like the building blocks are there.

I really want to see a web3/crypto project that has value outside of pure speculation, when we will see that (if ever) is what I’m not sure about

The valuable use cases are capital controls evasion, tax evasion, remittances to Argentina, KYC evasion, money laundering. It is truly and only a pirate currency use case. There is no dapp/smart contract/DAO construct that is fundamentally useful and can find PMF. I’d go as far to say that “Tokenomics”fundamentally destroys your ability to find PMF because it changes the incentive structure such that the biggest thing you can do to drive growth is to pump, not build.

> I think that in 2023, folks will start approaching these projects more cautiously

You have a misplaced faith in people. There is absolutely nothing of societal value in Web3, and the fact that the author of the article can claim otherwise with a straight face shows that enough people haven't understood this yet.

Whether you put the source of truth in a centralized database or a distributed ledger controlled by the crowd, the ultimate arbiter is the rule of law. As soon as you accept this, the only correct engineering solution to any problem of tracking ownership is the one that is the fastest and lowest cost (per transaction, to evolve the spec for new requirements including compliance with new laws, to roll back failures, etc.), and that rules out distributed blockchains.

Which is why feeless networks like Iota are interesting.

If you really believe Iota is cheaper, build your web services using Iota for OLTP.

Well put.

Reply on news.ycombinator.com