The appeal of the decentralized version of the Internet is that it gives users ownership for the content they create instead of monetizing user data as Facebook does, Web3 advocates said.
Before it was hit by controversy surrounding its unsustainable economic structure, the Web3 game Axie Infinity enjoyed a peak of about 2.78 million active players in January.
“The paradigm that made Axie powerful wasn’t play-to-earn,” said Yat Siu, group executive chairman and managing director of Hong Kong-based Web3 conglomerate and investment firm Animoca Brands, at the Philippine Web3 Festival on Nov. 15. “It was the ownership of the Axies that allowed someone like YGG [Yield Guild Games, a play-to-earn gaming guild] to come create a business on top of that ownership.”
As of writing, Axie’s average active player count has dropped to under a million.
Everything in the digital world is “already financified; we just don’t see it,” Mr. Siu said. “All of you here are building new economies, mini-nations in effect.”
According to Malik Khan Kotadia, co-founder and global board chairman of the Global Impact FinTech (GIFT) Forum, a non-profit think tank in the fintech sector, “Web 3.0 is supposed to be a harbinger of the ownership economy.”
The current version of the Internet, in contrast, is characterized by Web 2.0’s platform economy, composed of user-generated content and social media giants.
“The problem with the platform economies is that we saw the rise of monopolies,” Mr. Kotadia said, noting the billion-dollar valuation of Meta Platforms, Inc., the parent company of Facebook and Instagram.
“Your data has power, and not just power … but clear market value in the trillions,” he added.
According to Mr. Siu, if the platform economy persists, it is these same companies that will benefit from the growth of immersive gaming, which is expected to surpass $2.4 billion in global revenue by 2024, according to marketing data company Statista.
“The gamer doesn’t understand that he’s already heavily financified — that actually 80, 70% of his value translates to platforms that own his rights,” Mr. Siu said.
A proponent of tokenization, Mr. Siu said that non-fungible tokens (NFTs, or digital representation of real-life objects like art or music) is an alternative to the platform economy as it democratizes ownership and is a means of judging value.
“You’re really rewarding the players as opposed to giving all the value to the platform,” he said. — Patricia B. Mirasol