The Price of Web3

The Price of Web3

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Chris Miller
·Dec 29, 2021·

2 min read

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If you can sum up Web3 in one word — I think most people would say "decentralized."

While I do enjoy the idea of a decentralized web — I doubt that it will truly be "decentralized" as massive whales, corporations, and governments move in to invest their wealth for a stake in the game and begin lobbying and regulating.

Coinbase and OpenSea are examples where crypto and NFTs are traded in a centralized space which is counter-culture to the whole decentralized movement — right?

We should also recognize that their success comes from a very old business model that works and panders to society.

Convenience.

As long as societies are willing to "pay" for convenience, we will continue to give our data freely to social media platforms, purchase food from a drive-thru, have companies monitoring sound and visuals inside our homes, and allow institutions to do so centralize our wealth.

Web3 wants to change that — but it comes with a price.

Mining crypto is a critical part of the process that requires computers to solve complex problems, which can consume an unbelievable amount of energy when you scale it across the globe to billions of people.

As the value of any crypto rises, more and more people are incentivized to become miners. And because the difficulty of solving each cryptographic problem grows with the network, more and more energy is then used by miners.

Bitcoin's carbon footprint is bigger than that of many countries.

The argument could be made that Bitcoin is our biggest offender and that it's inefficient when it comes to mining— however — a more efficient crypto that consumes less energy can still be harmful — at scale and over time.

Here are a few other examples of how crypto can be bad for our environment.

Currently, a single Ethereum transaction consumes as much electricity as an average U.S. household uses in a workweek — and has a carbon footprint equivalent to 140,893 Visa credit card transactions or 10,595 hours of watching YouTube.

While the above examples focus specifically on Bitcoin and Ethereum — any other crypto at scale is capable of doing better or worse — but they will require mining and energy consumption at the end of the day.

All of that said — Web3 is not bad.

While centralization and energy consumption appear to be unavoidable looming clouds over the Web3 — that's where I see an incredible opportunity for us to solve these problems.

Just remember — it has to be convenient.

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