January 18, 2022
Our first session of BlockChai ’n Chill was an interesting ensemble of various topics on the future of this game-changing technology.
Hosted by Decentology's CEO & Founder Nik Kalyani and Community Manager Niharika Singh, the inaugural online discussion covered topics such as the difference between Web3 and Web2, how to select the right blockchain, the nature of DAOs, decentralized finance, and much more.
In case you missed it, we’ve got you covered. Here are some of the thought-provoking insights we discussed:
The impact of Web3 on domains
The media currently portrays Web3 as a utopia. They have positioned it as a singular solution to obstacles that limit human development. But that’s not the accurate description.
Even though it’s a disruptive technology that will shape the internet, it still needs to develop into a robust ecosystem. In addition, the community must identify the domains that blockchain technology will develop and focus more on its innovation.
While Web3 has its own set of limitations, we can say that it’s more sophisticated than Web2 and we have reasons to believe that.
Web3 vs. Web2 - what’s the difference?
Despite Web2’s resourcefulness, the growth is slow for organizations using it. Whereas, in Web3, it’s fast and easy to bring ideas to life in a few weeks and launch them as a completed product.
Monetizing one’s service on Web2 can take a while even though the process is simple. For example, if an organization has developed an app, the cost of marketing it to the end-user till they download it on their device is high.
In the case of Web3, all you need is to talk about your product on Discord and it can go viral instantly. Olympus DAO is one such example.
However, some new users are confused while selecting the most suitable blockchain system. Our community manager Niharika provided a simple answer to this challenge:
“If you are making a data-critical application where security is important, such as healthcare and finance, then I would choose Layer 1 (Ethereum or Solano). I wouldn’t go for Layer 2 where the security is low. L2 is a right fit for gaming applications.”
The future of finance is DeFi
We mentioned earlier that blockchain will disrupt several domains and finance is certainly one of them. DeFi (or Decentralized Finance) is innovative with the potential to get past centralized resources.
While our traditional banking system doesn't favor a decentralized approach, DAOs (Decentralized Autonomous Organizations) such as Olympus are building a community based financial infrastructure to bring stability and transparency to the system.
Today, if a person applies for a loan, the bank asks them a lot of questions that may not be relevant in some cases. However, in the case of DeFi, you can borrow any amount of money as long as you can put up a subsequent amount of collateral against it. You are neither questioned nor do you need to reveal your identity. On a blockchain-powered financing model, everyone is treated equally.
Which is why we think open financing is the way to go!
DAOs: Current perception and Challenges
This brings us to a very unique question asked by one of the participants, "Are DAOs socialist in nature?"
The answer is no.
Since hierarchy isn’t well-defined in a DAO, it may look like a socialist system. But ultimately, even a DAO will need people who should define the direction. Also, many DAOs use multi-signature wallets so that the power is decentralized.
In a DAO, one owns a token, and the collective efforts result in the token getting some value. As a result, the person holding the token gets his due. This makes DAOs different.
When you consult a company today, you get money for the ideas you put in. However, with DAOs you can also partake in the value other people create in the system besides contributing to its development.
In addition, DAOs are in the domain of the knowledge-based economy. So applications with data & information can be used with DAOs. While these modules are a breath of fresh air, the community still has a lot to figure out. As of now, DAOs are working on governing challenges such as creating a fair and balanced system for voting.
So, the question remains - can we apply the model in real-life scenarios such as services and manufacturing? Secondly, how will it work when there are so many external elements that may influence the system?
Watch the full recording of the session on our YouTube channel here.
To get access to similar insights join us in our second online session of BlockChai ’n Chill this Thursday.