As the race for enterprise adoption in web3 accelerates, some people believe it’s not one-sided growth, but a journey where both mainstream enterprises and crypto startups can bring on new opportunities.
“The signals that we see right now are that the innovation is coming more from enterprises,” Gagan Mac, head of product and senior director of web3 services at Circle, said on a panel at the Avalanche House event in Seoul, South Korea.
For example, Nike and Starbucks launched their own NFT-linked services: a marketplace and a loyalty program, respectively. “NFTs may be down in value, but every single person who minted a Starbucks NFT with the Odyssey program, they’re all positive, and the value of their NFTs have grown,” Mac said.
Dan Sun, startup success manager for web3 APAC lead at Google Cloud, said that this market is still nascent. “We’ve been seeing what value we could bring to the new emerging markets and what kind of positioning we should be taking,” he said. “So we’re still discussing, we’re still learning, and we’re still seeing which values we can provide.”
Lowering the barrier to entry could be as simple as fixing the terminology to make the technology and web3 elements more approachable. This is something we’ve seen happen with big brand companies getting into the space; they use terms like “digital” or “virtual” instead of calling it web3 or the metaverse.
But what about the startups? “I think both parties have chances,” said Lihan Lee, co-CEO and founder of web3 data intelligence platform Xangle.
“It’s going to take longer for us to adopt the whole concept and try to move what we’ll be doing into a completely new industry,” Sun said.
While the use cases in enterprise are more incremental, the real drivers of the tech might be coming from startup land. “We have evidence to suggest that the value is coming from enterprises. However, I believe the startups are going to be disruptive,” Mac said. “There will be incremental value that enterprises bring in because they have a set customer base. So for them, it’s easy to prove out how technology and blockchain is going to add value, net new value, to their use cases.”
That’s because startups have more freedom and not a lot of red tape to cut through in order to get the tech to market.
“I think what will happen is that a big breakthrough moment will happen as this tech, which already exists [and] which is already secure, gets adopted by web2, by banks, by gaming, by all these folks flowing into the industry,” said Johann Eid, chief business officer at Chainlink. “Those use cases are here already, it already exists but what we need now is adoption and liquidity and that will come through web2 enterprise adoption.”
“I see existing web2 enterprises, who are aggregators of users,” Mac said. “We’ll see multiple of these having crypto wallets.”
When you think about who were the big shakers and movers during the dot-com boom and the rise of social media sites, it wasn’t old school incumbents, but (once) new and young startups or businesses that later boomed into something bigger.
On a similar note, Lee said, “I would rather bet on the startup side because startups tend to think more radically and they tend to capture opportunities very quickly.”
Even though the crypto industry had crippling events like the Terra/Luna collapse and FTX crumbling in 2022, there is always a bright side.
“Enterprise adoption didn’t slow down,” Eid said. “It’s actually been accelerating. Bank adoption didn’t slow down, but it’s been going up. Gaming from web2 companies in Japan and Korea are accelerating.”
While there’s an unlimited amount of rough patches in the crypto world, Eid views it as always seeing the light at the end of the tunnel.
“And to me, that’s the light, it hasn’t stopped, it’s actually been accelerating,” Eid added. “My take is that web3 startups have been experimenting for years and they’ve actually shown unique use cases you can have with fully programmable money, with money markets, with derivatives running on chain.”
This story was inspired by an episode of TechCrunch’s podcast Chain Reaction. Subscribe to Chain Reaction on Apple Podcasts, Spotify or your favorite pod platform to hear more stories and tips from the entrepreneurs building today’s most innovative companies.
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