Crypto Politics Continued
I wrote last week how web3 is now a major political issue. Well, the news continued and it’s worth digging in a little more.
This week, we saw two proposals in Congress - one from the Left one from the Right – to roll back the overreaching crypto regulations in the infrastructure bill signed into law on Monday. Members on both sides of the aisle can agree how the regulations needs to be peeled back to ensure America doesn’t miss out on the benefits of web3.
It’s these benefits that are slowly being understood.
The fact is that Web3 is a way to innovate towards resolving several major political issues.
The Senate candidate from Ohio described the situation well last week when she wrote that corporate monopolies “aren't winning because they're the best. They're winning because they lock in users and their data and use that combination to dominate markets.”
In web3, users own their own data and can take it to different applications as they please. This is called “Data Portability” and it will provide a new foundation to the internet preventing this data lock-in. This will create optionality and competition that doesn’t exist for tech giants today.
Social media censorship
Every politician is now aware of the enormous power of social media companies to censor or block anyone they please. This is too much power for any one corporation to hold. Jack Dorsey is the first to admit this.
In the same vein as point above, data portability enables users to take their data to another application if they are not satisfied with the one they’re using. For example, if you disliked FB censoring Trump, you could take your profile and network to another application that had different policies. Again, this creates competition where users will have options to engage with content they prefer and not be at the mercy of any one company’s censorship policies.
Racial inequality (to financial services access)
If you google “financial services racial inequality,” you’ll find many articles from major publications about how the lack of access to financial services for minorities is a major cause of the disparity in wealth among races. The access is limited by physical location of bank branches and other burdensome rules for these communities.
Web3 has a new financial system where everyone has equal access. It does not require a physical bank branch in your neighborhood or approvals from any institution. Everyone plays by the same rules written in code.
Often when network companies (e.g. Uber, AirBnb) grow, only a relatively few employees see financial upside while network contributors are left out. For example, Uber employees got rich, but the Uber drivers saw little benefits.
Web3 allows contributors to networks to own a piece of the upside and contribute to governance decision making. So, the Uber of the future will have many more owners and distributed wealth based on contribution to the network’s success.
The toothpaste is out of the bottle. This is all happening now. This decade, these benefits will reach mainstream audiences. This is what I think politicians are waking up to.
I’m optimistic about the US leading the way if they continue to learn and stop spreading ridiculous FUD.