A Conversation with Tom Shaughnessy on The Evolution Of the Web3 Stack
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Description
Host Tom Shaughnessy talks to Kyle Samani, Founder and Managing Partner of Multicoin Capital. Kyle discusses his predictions for the middle layer and full-stack development, attracting developers to the crypto space, how competition in the industry will develop, and a complete discussion on the Web3 Stack.
Key Points
While there are a lot of opportunities higher up the stack, there is the most money in layer one because that’s what has been proven stable over time.The next few years will see an explosion of Web3 experimentation.In crypto, like with everything in technology, developments will happen very slowly, then suddenly very quickly. Quotes
“When I think about opportunities for investing in the middle layer, they are generally less competitive as a function of market size, and not as many developers recognize that those markets exist.” –Kyle Samani“As these services continue to mature, we’re going to start to see people build world-class applications—we’re going to start to see new things come out over the next 12 months or so.” –Kyle Samani Episode Highlights
Kyle recently published his 2019 update to the Web3 stack, which is about inverting the data model that powers the internet so that users own their own data.Kyle predicts that what we will increasingly see over the next few years will be more heterogeneity in investments, which will lead to more consolidation.Tech companies and teams that don’t pivot the right way will likely go down with their last dollar.Kyle thinks companies that are forced to run on a chain other than Ethereum or choose to explore that will choose chains that are very good at one specific thing.It’s difficult to attract new developers into crypto because the business models to make money are not yet understood.People are not good at having an historical sense of technology and understanding that once the basic idea for something arises, it takes many more years for the first iteration of the thing that will make those core ideas work.There are a lot of opportunities right now in the middle layers.There is the most money in layer ones.Developers typically want to know what will be possible in 12-24 months so they can build better applications upfront.There are structural issues with pushing complexity up the stack; the whole purpose of layer one is to abstract the complexity.Kyle agrees with Spencer Bogart of Blockchain Capital that most competition will eventually happen vertically, on one or a small number of chains.Kyle predicts that Polkadot will attack Ethereum this year, based on their recent behavior.Full-stack integrated approaches are great, but no one team can pull off all that complexity in any reasonable timeframe.
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