Opinion: In order to make progress in 2024, Web3 must take a step back before moving forward.
Disclaimer: The opinions expressed in this article are solely those of the author and do not reflect the views and opinions of crypto.news’ editorial team.
At first glance, the current state of the crypto market appears significantly different from a year ago. Bitcoin (BTC) has more than doubled its value, reaching over $16,000-17,000, and the total market cap of cryptocurrencies has comfortably surpassed a trillion dollars.
However, despite these positive signs, the crypto industry still faces numerous barriers to widespread adoption. While the recent price recovery can be attributed to speculation surrounding the approval of Bitcoin ETFs, it is crucial for the industry to take a step back and slow down in order to make meaningful progress in 2024. Without this regression, the industry risks repeating the same cycle with only minor improvements or variations.
Although the crypto industry is still relatively young, being just over a decade old, it is essential to address the existing challenges and solidify the foundation for widespread adoption. While innovative concepts like NFTs, web3 gaming, and SocialFi may generate curiosity and interest, they are not yet suitable for mainstream users. Blockchain technology itself is already complex enough for newcomers to understand, and introducing unfamiliar ideas only complicates matters.
Instead, the industry should focus on more tangible utilities like established payment systems and real-world assets (RWAs) to drive adoption. Mainstream users are already familiar with these concepts, making them more appealing for institutional and mass adoption. The data supports this approach, with RWAs currently having a total value locked (TVL) of $5.7 billion and projections for growth up to $10 trillion.
Furthermore, accessibility remains a significant challenge for web3 and crypto. To overcome this, the industry needs to provide more convenient on and off-ramps for crypto, coupled with regulatory compliance. These utilities will serve as the backbone for adoption, as they are stable, reliable, and capable of withstanding the test of time.
Another crucial aspect that needs attention is the focus on sustainable business models rather than Ponzi schemes and empty promises. While speculation may fuel the web3 space, it creates volatility and instability that discourage new entrants. The industry must prioritize value creation and revenue generation to gain legitimacy and attract mainstream users. Projects like FTX and SafeMoon, built on sustainable business models, have demonstrated the importance of decentralization, self-custody, and due diligence.
In 2024, the industry will witness a shift towards sustainable business models, where tokenomics and trendy narratives take a backseat. Projects that deliver on their product roadmap and provide real utility will outperform competitors relying on hype-based marketing. Both builders and users must be patient and practical, supporting projects with proper revenue sources instead of chasing moonshots or quick profits.
Additionally, web2.5 products and services that combine the decentralization of web3 with the efficiency of web2 will play a crucial role in driving adoption. Many mainstream users are more comfortable with custodial services, and these centralized platforms can serve as a bridge to web3. Companies like Coinbase and Binance are already providing entry points into the crypto ecosystem for their users, facilitating the transition.
However, the security aspect of the industry still needs improvement. Scams and exploits are prevalent, resulting in significant losses. The web3 industry must prioritize security measures and user education, along with improving product UI and UX. Decentralization should be the ultimate goal, but it needs to be accessible, safe, and user-friendly for mainstream adoption.
While the road to widespread adoption may be long, the industry’s progression through regression in 2024 should be celebrated. This approach will bring the industry closer to achieving significant breakthroughs and making mainstream adoption a reality.
