🐻 Web3 trends that could take off in 2023 🚀

Low-barrier NFTs, web3 social & gaming

Author

Build in Bear
December 27, 2022

GM friends. Did you remember to make your wish to Santa? We sure did! The only wish we made this Christmas was for a better year for crypto in 2023.

Before we jump into this week's issue, if you’re new around here and feel a bit lost, don’t worry. Hit subscribe and we’ll get you caught up on all the latest news in web3, 2x a week.

In this issue, we’re diving into our predictions of web3 trends that could take off in 2023:

  • 🖼️ Low barrier NFTs

  • 🤳 Decentralized social network

  • 🎮 Blockchain gaming

1/ Low barrier NFTs

In 2022, we saw the speculative bubble of trading jpegs on the open market slowly die down. The overall NFT trading volume experienced a steep decline of over 80% and slashed the prices of several top NFT collections.

It's been a free-for-all sale, but still, we think that the barrier of entry to web3 needs to lower even more and the use of NFTs by mainstream traditional brands could do just that.

Iconic brands like Nike, Starbucks, Disney and Reddit have all partnered up with Polygon to build projects and platforms that incorporate an element of NFT. For instance, Starbucks recently launched their beta loyalty platform that rewards users with “stamps” (an NFT) when games and challenges are completed.

Reddit also made shockwaves in the industry with their practically free NFT avatar collectibles.

So what’s the point of Starbucks or Reddit giving free NFTs? Well, nothing, to be honest, they’re pretty useless if you’re talking about monetary value, but priceless for helping newcomers open a blockchain wallet and onboard to web3.

Thanks to Polygon, we predict that major traditional brands will dominate the NFT market and continue to lower the barrier to entry in 2023.

2/ Decentralized social network

A censorship-resistant social platform isn’t a novel idea, but creating a protocol that can compete with the existing giants is tough. With Elon’s Twitter takeover and release of the Twitter Files, we think this will finally push the industry toward a decentralized social network.

There are currently three main web3 social protocols with the goal to build a decentralized, user-owned network that all have slightly different approaches.

Lens Protocol

Built on Polygon, Lens Protocol is a web3 social protocol that leverages NFTs to create a truly decentralized ecosystem. For instance, when you create a Lens profile, an NFT is minted in your blockchain wallet. When you follow, like, share or post content, an NFT is also minted on-chain.

This means that if you ever get banned on a platform or want to move to another, the minted NFTs (profile, followers, content, etc.) will continue to be owned by you and never be lost.

Lens Protocol has nearly 100,000 total users and 40,000 monthly active users in just a year since its launch.

Farcaster

Unlike Lens Protocol which tries to be completely decentralized, Farcaster thinks it’s enough to be “sufficiently decentralized”. Besides storing user identities on-chain, everything else (likes, posts, follows) is stored off-chain in specialized servers called Hubs (similar to blockchain nodes).

Doing this gives Farcaster the speed and scalability of web2 apps, while leveraging the permissionless feature of web3 innovation.

They currently have over 7,500 total users and 3,500 monthly active users.

DeSo

Formally known as Bitclout, DeSo takes the opposite approach of Farcaster by building a fully decentralized L1 blockchain for social apps. However, this means that DeSo is exposed to the same risk as other L1 blockchains. If the price of DESO token plummets, this could collapse the whole network and make it more vulnerable to attacks.

Compared to its competitors, DeSo currently boasts the most monthly active users at 130,000.

When it comes down to it, web3 social protocols can only flourish if they can attract enough engaged active users from traditional social media apps. We think that the timing is finally ripe for disruption for a new decentralized Twitter to dominate.

3/ Blockchain gaming

The play-to-earn (P2E) sector saw major gaming projects drop over 90% in market value this year. In spite of that, the number of unique wallets associated with gaming increased to 1.15 million, accounting for roughly 49% of daily blockchain activity.

In this next era of blockchain gaming, we see a revival of prioritizing fun and engaging gameplay over the novel use of cryptocurrency. Gaming is one of the most seamless ways to onboard new users to web3 and we expect to see plenty of big-name gaming studios continue to make waves on-chain in the coming year.

In other news 🗞️

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