It sometimes feels like there\u2019s an aversion to embedding elements of crypto into otherwise more traditional types of consumer applications. After all, why should something like a movie ticket live on-chain when millions of people already buy movie tickets as is? Or so the logic goes.This is short-term thinking.The real unlock lies in the long-term capabilities created from the buildups of data that aggregate on-chain. Traditional-looking apps with select elements of data or resources on-chain create the ability to see patterns of user across both time and applications. These are new information networks that not only don\u2019t but can\u2019t exist in Web2.My hypothesis is that these information network, or “metagraphs,” will expand the design space for engaging and exciting consumers.Alana Levin is an Investment Partner at Variant, where she focuses on infrastructure.Blockchains as metagraphsA straightforward way to envision a blockchain is as an open, permissionless database. Users interact with applications via wallets, which live above the data layer on-chain. I\u2019ve always thought of blockchains as loosely analogous to cars, transporting users from one destination to another (where each \u201cdestination\u201d is an app). As such, wallets also provide identifiers for one\u2019s interactions across different blockchain-based applications.See also: Coinbase Starts ‘Wallet as a Service’ So Companies Can Build Their Own AppsThe result is that the blockchain itself becomes an information network. By having a unified identifier for a unique user\u2019s activity across applications, developers can start to construct and leverage more holistic views of user behaviors. These metagraphs are useful for segmenting customer behaviors, identifying superusers and facilitating more meaningful connections.An example might help put the value of these metagraphs in context. Consider the relationship between a musician and two of their fans:Fan A: listens to that artist\u2019s music on Spotify for five hours a week, likes every single one of their Instagram photos, subscribes to their newsletter, collects the albums on vinyl, buys their merch and attends their concerts whenever they\u2019re in town.Fan B: listens to that artist\u2019s music for 10 hours a week on Spotify but doesn\u2019t do any of the other things.Which fan is more of a superfan? Clearly it’s Fan A. However, most consumer behaviors are untraceable, and so depending on the data the musician can see, they may unwittingly value the second fan more \u2014 after all, Fan B listened to their music 2x more than Fan A.Don\u2019t believe this is a real pain point? Say that the musician is Taylor Swift, and both Fan A and B really want to be whitelisted for early access to ticket sales for her next tour. Based on Spotify data alone, Fan B would likely receive priority. A painful result for Fan A and an unoptimized outcome for Taylor.Blockchains change this dynamic. Putting information and activity on-chain expands the surface area for how applications, creators and consumers may think about patterns of behavior. Many of the components in the musician example could easily involve (minimally invasive) on-chain elements:Subscribe to a newsletter via Mirror, with on-chain provenance of that subscriptionLike\/collect social media posts on Lens (or maybe one day Farcaster?)Buy merch or vinyls that have digital twins on-chainCollect a record on Sound.xyzEach ticket itself could be a non-fungible token (NFT) Scan a QR code live while at a concert to mint a proof-of-attendance NFTIn isolation, each of these may not seem like material improvements in consumer applications.The question shouldn\u2019t be whether blockchains are necessary, but rather whether they\u2019re helpfulThe aggregate metagraph, however, is a new social mapping \u2014 and that is what\u2019s meaningful. Build a new road connecting two towns, and someone might not find it meaningful. Build a new highway system though, where each new road may not represent a significant incremental impact but the system in aggregate creates new connections, and you\u2019ve built something powerful.Expanding the metagraph: Time as a new elementIf activity across applications is one form of how metagraphs expand context, user behavior over time is another. Every action on-chain is timestamped, which means third-party developers can tie together things that happened at certain dates\/times, regardless of whether those actions occurred within their specific applications.This is a step-function improvement in creating compelling products. References to personal history can produce compelling emotional ties between a user and an application. But within Web2, time as a dimension has been gated to incumbent apps: the data is siloed, so apps can only reference behaviors that existed within their app.These emotional ties are powerful retention levers. Case in point: I still use Snapchat, despite not having sent an actual Snapchat in years, because I enjoy the \u201con this day five years ago\u201d type of reminders and the nostalgic feelings they evoke. The longer an app has been around, the greater its ability to embed time into the product.The problem is that new applications can\u2019t tap into such elements of time. To date, the only way to create an \u201con this day five years ago\u201d type of notification is if the app has been around for at least five years. This is not a favorable environment for new apps, which may explain why we haven\u2019t seen many new consumer apps take off in recent years.Web3 changes this dynamic. By encouraging activity to live on-chain, it democratizes access to information.See also: It’s Time for Web3 Games to Embrace Play AND Earn | OpinionThe ability to tap into global contextual information expands the design space for builders to remix and reimagine consumer experiences around specific points in time. One of my favorite examples would be an app built entirely around recreating \u201c2015 vibes\u201d \u2014 with an interface and content feed tailored to the types of songs, writing and media an individual consumed during 2015.It\u2019s like taking a nostalgic playlist on Spotify and making the experience 10x more immersive by enriching the interface with other media relevant to you from that time period. And because this data isn\u2019t gated by outrageously expensive APIs, the app developers can build it with relatively low overhead. Phrased differently, the idea doesn\u2019t need to be venture-scale to deliver a delightful experience.Why does this matter?It\u2019s very possible that some breakout Web3 applications may look largely indistinguishable from Web2 in the short term \u2014 with crypto elements simply living under the hood\u2014and that the true \u201caha\u201d moments will come years down the road. An idea only needs to be modified by 3% to create something entirely new. Putting select elements on-chain may be that 3%: it creates optionality around what else can be built that leverages that data.The challenge is that it\u2019s rarely obvious what those products or features are, at least in the short term. As a result, some may write off the benefits of fostering such open access. I think this is a mistake. Open access to data facilitates experimentation and, in turn, creates a market of developers building with the broadest set of ideas.Moreover, the most interesting metagraphs likely rely on identifying patterns across many applications and time periods.My guess is there will be a point at which the richness and breadth of data onchain will hit an inflection point. Thus, while some applications may look skeuomorphic today because at the surface they only innovate on a few degrees of the product, those three degrees can change the long-term trajectory entirely.To be clear, there are also short-term, more single-player benefits to building on crypto rails. Crypto often offers cheaper and better payment infrastructure, especially if a product\u2019s user base is globally distributed. The relative ease of creating secondary markets means areas that may suffer from traditionally wasteful resource consumption (e.g. unused airline tickets, reservations, etc.) can be made more efficient and unlock net new value. Attribution \u2014 and value attached to sources of distribution \u2014 may be easier to track and program on-chain.See also: Decentralization, on a Spectrum | OpinionBut with each of these single-player examples, it\u2019s important to note that the problem to be solved should never really be viewed as a \u201ccrypto\u201d problem. Rather, the framing should be to use crypto as an enabling technology for whatever industry the application actually lives within: restaurants, entertainment, sports, content creation, etc. The most compelling short-term benefits are often best described relative to the context of each industry.The point of this piece is to highlight what might be enabled when large parts of a broader system are rearchitected in an open and collaborative way \u2014 because that\u2019s arguably less obvious, but just as important. We\u2019re now at a point where crypto is becoming both easy and secure enough that using it under the hood adds little to no cost \u2014 and, at a minimum, opens a valuable call option for future product directions.So if you\u2019re building an app that leverages elements of crypto and someone asks \u201cwhy does it have to be Web3?\u201d send them this piece. Because the question shouldn\u2019t be whether blockchains are necessary, but rather whether they\u2019re helpful. It\u2019s like asking if a car is necessary to get from one place to another 20 minutes away: it\u2019s not necessary, but so long as the technology is safe and sufficiently inexpensive, it\u2019s probably preferable.The same is true of blockchains: so long the infrastructure continues to improve, the answer to \u201cis it helpful to leverage blockchains?\u201d will increasingly be yes.<\/p>\n","protected":false},"excerpt":{"rendered":"
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