Decentralization… The term which might have been closely associated with anarchy has now become an integral part of a cutting-edge technology called the blockchain. The blockchain, as many of you may have known, is the technology behind cryptocurrency. However, it is a completely distributed, decentralized, and immutable digital ledger that opens up opportunities for recordkeeping that is both secure and transparent!
In theory, the blockchain might look like yet another advancement in technology. However, what the blockchain has opened up is nothing short of spectacular… because the revolution created by the blockchain has been the spearhead of the transformation of the Internet. It is a massive upgrade from the existing version of the web… And the new version is endearingly and fittingly addressed by everyone as Web3.
In what way is Web3 different?
When DARPA opened up its internal network ARPANET to the world and when CERN unveiled the concept of the World Wide Web, they intended it to be a completely transparent and uncontrolled channel for worldwide communication. However, the initial monopoly over the web meant that information was confined to being produced by a few handfuls of media companies and consumed by millions (not billions!)!
The next version of the web called Web 2.0 was a step ahead but it was not the ideal one either. Web 2.0 ensured that the information-creation and consumption became more democratic, giving room even for common people to communicate with the world and to the world. Blogs, social media, and video publication channels like YouTube belong to this version of the web. While the distribution and consumption of information were effectively taken care of, the commercial element of the web still was in the control of a few global giants.
The main aim of Web3 is to address this disparity of commercial distribution at the roots. By giving users the right over their data and by bestowing upon owners, complete control over ownership they can exercise over their digital assets, Web3 has changed the way people look at the web in its commercial and information dimension.
On the surface, it might seem like it would be a bad idea for brands to let go of the control they had over user data in Web 2.0. However, reality speaks otherwise! With the digital freedom and control that Web3 gives, users can connect with brands with a greater degree of confidence.
The digital identity of things and even humans in the Web3 space is enabled by one of the best manifestations of the blockchain technology called non-fungible tokens (NFTs).
NFTs have opened opportunities for brands to connect with their fans in ways that have never happened before.
How does it work for brands?
We have observed that brands like Nike have netted more than $185 million in NFT sales alone. People have always wanted to connect with their brands in a unique way that they can flaunt. Some amount of credit for this craziness of fans should also be attributed to the brand ambassadors of big brands. By creating unique assets and by capitalizing on the versatility of digital space, brands can now create unique experiences for their fans.
These experiences might include unique digital merchandise that can entitle the owners of such merchandise to some real-world events. There have also been instances of the owners of these digital assets getting a chance to meet their favorite brand ambassadors in person. Since the blockchain takes care to establish the authenticity of the person, fans can also be assured that there is no foul play in this entire exercise.
We must now digress a bit to talk about the metaverse. The metaverse is a virtual world where connected Web3 conversations are expected to happen. The only difference between the metaverse and the other forms of virtual worlds is that the metaverse serves as a digital extension of yourself and other people, reflective of their personality in the real world.
Therefore, if you meet your favorite superstar in the metaverse, it is quite possible that you are actually interacting with that person!
How does it benefit individuals?
Humans are creatures with emotions… And they have always sought recognition which, in most cases, comes from certain uniqueness. This uniqueness could be because of their allegiance to certain brands and celebrities. Let us take, for example, the guy who always painted the Indian flag on his body with the Sachin Tendulkar name and number on his back, proudly waving the Indian flag in every cricket match that the Little Master has played! He has not played even a single game of cricket but the fact that he’s the biggest fan of Sachin Tendulkar makes him famous and recognizable!
In the same way, if individuals were given some kind of provable exclusivity from celebrities, brands, and businesses, they are bound to rejoice and delight in it!
Even if it weren’t for all that rejoice and delight, the individual also gets commercial benefits. Since the collectible that they have has an element of provenance (it can be proved beyond doubt that it was the original piece released by the brand), they can consider selling it on NFT marketplaces. Since the count of the collectible is quite limited and is probably rare, other collectors will compete to buy the original digital creation of their favorite brand!
Web3 also opens up opportunities for artists to connect and collaborate with businesses, giving opportunities for businesses to get their hands on original artwork that they might consider using for commercial purposes. The NFT element of the artwork ensures that the creator does not lose their attribution at any point in time.
Remember this favorite quote of people who have gone through a break-up?! “If you love it, set it free! If it comes back, it’s yours forever! If it does not, it never was!!“
This, very subtly, holds true in the case of brands!! Web3 provides the space for brands to let go of their hold on user data, serving as a digital litmus test to find out who the true brand fans are! If a person is willing to pay the price to get their hands on a digital collectible offered by the brand, then the brands should definitely celebrate such ardent and loyal fans.
Does this mean that the fan does not get any benefit? Definitely not!! They also get to flaunt their exclusivity which can translate into extraordinary material, emotional and commercial rewards for them!