Digital wallet wars are the new browser wars

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Most people might not remember that websites once had icons that said “This site was optimized for Internet Explorer,” but two decades ago this was not uncommon.

Much like today’s battle between Web 2.0 monopolies and Web 3.0 communities, at the start of the mainstream Internet, a similar battle unfolded over who would own the portal: a global monopoly to closed source code or an open source nonprofit. .

A battle for the soul of the Internet

Long before Web 3.0, the browser wars defined the start of the Internet. Netscape Navigator was the first consumer browser on the market and the browser of choice for early Web users. For many, it was synonymous with the dawn of the Internet.

Slowly but surely, however, Microsoft has leveraged its monopoly position in the operating systems space to push its closed-source alternative: Internet Explorer (IE). It was able to outperform Netscape and become the default choice for users simply by packaging the browser with Windows.

In 1998, Netscape opened its browser and helped create the Mozilla Foundation which supported a free software community made up of its contributors. In 2002, the open-source-based Mozilla Firefox browser was released under the initial codename “Phoenix”, in reference to how it was born from its ashes.

A battle ensues for the soul of the Internet. Internet Explorer was a closed source; Firefox was open-source. Internet Explorer was started by a monopoly; Firefox was run by a foundation.

Firefox broke Microsoft’s stranglehold on closed sources, paving the way for Chrome, which was built on the open source Chromium project. With the rise of the mobile Web, it revolutionized Internet Explorer. Otherwise, users might still see “This site has been optimized for Internet Explorer” when they load this page.

Internet Explorer was also at the heart of Microsoft’s monopoly business, which led Microsoft to reinvent itself in 10 years as a champion of open source software.

A new internet

Flash forward until today. Web 3.0 Compatible Wallets are the tools millions of people use to participate in the new world of Decentralized Autonomous Organizations (DAO), community-managed DeFi protocols, and the metaverse. They are the portal to these applications, just as the browser was the portal to the websites of the early Internet. Soon they will be the default interface to a new Internet – the land they will fight for.

Related: The three traits of Web 3.0 that correct what was wrong with today’s Internet

The more things change

Again, we have a monopoly that bothers us. It’s not free and open-source. The sites are optimized for this. We have to fight again for this. Much like IE’s role in shaping Web 2.0, many DApp and Web 3.0 applications began to be optimized for MetaMask, the current market leader in digital wallets. While it is true that users will follow the path of least resistance, it could have the detrimental effect of placing the ecosystem entry point in the hands of a conglomerate.

Much like IE, MetaMask began to rely on monopoly practices and a walled garden approach reminiscent of Web 2.0 and its regressive business models. After switching its codebase to a tiered proprietary license, it grew from around 500,000 to over 21 million monthly active users in just over a year as the general public flocked to the Web 3.0. Those same users paid more than $ 237 million in service fees on its exchange feature in the wallet during that time.

Based on these figures, the project raised $ 200 million in capital from a wide range of companies, including HSBC. This was all good for ConsenSys, the conglomerate that owns the MetaMask codebase. However, none of this was of benefit to its users. Additionally, former employees and shareholders are now sounding the alarm bells about ConsenSys involvement in Wall Street companies such as JPMorgan – a relationship that is at odds with his original ideas about opening up and decentralizing the company. finance.

Many felt that this growing market penetration and MetaMask’s Web 2.0 approach to digital wallet development betrayed the potential of the Web 3.0 stack. Decentralized applications have opened up opportunities for participatory business models that may be lost to the same early proponents of a more open internet. Business models capable of redefining the relationship between tools and their users.

Related: The three traits of Web 3.0 that correct what was wrong with today’s Internet

But they don’t have to stay the same

History does not have to repeat itself. In this new context, we will see a lot of historical echoes when it comes to Web 3.0 and digital wallets. There will always be closed source, monopoly managed software, and there will be new kinds of open source and community managed alternatives. However, unlike Web 2.0, users now have more leverage in deciding where things go. They now have the choice to create, govern, and enjoy the benefits of open source software that they may actually own.

Web 3.0 creates an environment in which the copyright-heavy, closed and profit-driven Web 2.0 business models will not work as well as they once did. The projects under development on this stack are open source, composable, and community driven. When we talk about technologies that make it possible to program money, these details make all the difference.

Related: Is a new decentralized Internet, or Web 3.0, possible?

The nature of Web 3.0 has made it possible for any project to branch off the codebase of any other project and develop a better alternative – a situation that ultimately benefits users. At the same time, decentralized access to capital and community incentives makes any project capable of penetrating the market.

This overturns the centralized Web 2.0 model and makes community the deciding factor in any Web 3.0 project. Some examples of this are DeFi 2.0’s current trend towards protocol-owned liquidity and increasing DAO purchasing power. Unfortunately, the interface where many users access these applications is still stuck in Web 2.0.

What to expect

An increasing number of users are familiarizing themselves with the possibilities of Web 3.0. In the future, they will expect the interface they use to access these applications to provide them with the same benefits as the applications themselves. It may be too early to say which current project will share the fate of Internet Explorer. It’s not too early to know that Web 3.0 users will want to own some of the software they trust with their digital assets.

This article does not contain any investment advice or recommendations. Every investment and trading move comes with risk, and readers should do their own research before making a decision.

The views, thoughts and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Matt Luongo is the founder and CEO of Thesis, the crypto-venture production studio behind Fold, Keep, tBTC, and Saddle. Since its inception in 2014, Thesis’ wallet has served millions of users and holds a total locked-in value of over $ 300 million, partnering with brands like Visa to advance the adoption of Bitcoin and others. digital assets. Matt Luongo has been a serial entrepreneur for the past decade and held several technical leadership roles before entering the cryptocurrency industry full time in 2014. Matt holds a Bachelor of Computer Science degree from Georgia Tech and is based in Atlanta, GA where he is a husband and father of two.



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