On The Other Side ep 56 - An unstructured conversation on consolidation, monopolies, and values w/ Tommy Lower
Primer: What happens when projects run out of funds in their treasury? Will the industry consolidate into a few major players? Aren’t we just replicating the monopolies we’ve seen in Web2 in Web3? Join Chase Chapman and Tommy Lower in their conversation on this episode of On The Other Side.
Background
Part of the content marketing, product-facing department at Tally
Involved in a lot of DAOs
Tweet On DAO Tooling
Predicting that the different DAO tools would consolidate into a couple of players in a few years’ time
Thinks that we are all part of one large tech company called Web3 LLC
We have all these silo-like R&D departments which are individual DAO tools
Unsure whether his thesis will pan out
Do Moats Exist In Web3?
At some point, projects need to be profitable and not rely on VC money
In Web3, the lines are blurred between competition and collaboration
These lines will still be there as some projects succeed while others fail
Moats should exist, but he’s not sure whether they should exist
Still trying to find out how centralized players could co-exist with decentralized players
Have to think about this issue otherwise bigger players can just copy the product and replicate the monopolistic landscape we see in Web2
Have to build a better system to prevent us from ending up in the same place we started from
Monopolies In Web3
Worst Case Scenario Of Monopolies
Monopolies are not inherently bad if they are operating in the best interests of the community
It’s the corruption that is enabled by monopolies that are bad
The monopolization and consolidation of DAO tooling are against the Web3 ideals of decentralization and trustlessness
The Plurality Of Protocols
The best in the space are idealistic thinkers
Tries to counter it with realism (e.g. what’s the 5-10 year plan? How sustainable is it?)
Right now, everything except a few large protocols is venture funded
Either waiting for time to run out or for these protocols to achieve profitability
Longevity Of The DAO Structure
DAOs are not meant to last forever
However, this does not mean that we are not trying to achieve the goal
The emphasis should be on empowering contributors and making opportunities for them
Onboarding People To Crypto
Layer 2 is helpful
Vitalik has mentioned before that institutional investors are not ready to have exposure to ETH at scale yet
Have to self-police a bit and be aware of other people’s downside
For people who are semi-interested, it’s important to go the extra mile and take the time to educate them
Got a friend who is interested in crypto
The friend was burnt by FTX
Not only have we lost someone who could have been part of the Web3 ecosystem, but we end up actively creating people who are against the system
Nowhere near ready to onboard the majority of people into crypto
Where Can People Find Him?
Can find him on Twitter
Can find his work at Tally, a DAO operations platform
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