Dorsey Says Web 3 Will Be Centralized

Dorsey believes VCs and LPs will make Web 3 decentralized.

Twitter and Square founder, Jack Dorsey, opines that Web 3, touted as the community owned internet, will not be what it promises.

Dorsey, a long-term Bitcoin proponent, has gone to lengths in the past to defend the cryptocurrency. He even took on the ones criticizing bitcoin for its carbon footprint.

However, on Tuesday, he expressed that Web 3, the new internet, will be controlled by Venture Capitalists (VC) and their Limited Partners (LP).

You don’t own “web3.”

The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label.

Know what you’re getting into…

— jack⚡️ (@jack) December 21, 2021

His tweet sounds like a warning stating that Web 3 will not be able to escape the big money offered by VCs.

The conversational thread became a full debate house.

This statement comes on the heels of his much-awaited tbDEX Decentralized Exchange, which aims at eliminating the need for Centralized Exchanges (CEX).

A section of people called Dorsey a Bitcoin maximalist on the grounds that he believes all other chains can be corrupted except for Bitcoin.

I know what you’re trying to say, but this isn’t the right take man. This is another form of the “only Bitcoin is decentralized & everything else is just fake decentralization” criticism. Keep in mind your web3 critique applies just as much to TBD & https://t.co/qWqxXvBGOJ too.

— Sam Kazemian (¤, ¤) (@samkazemian) December 21, 2021

Netizens were divided between the Proof of Work (PoW) and Proof of Stake (PoS) consensus mechanism protocols.

pick one:
1. power controlled by those with the most physical resources (computers, energy, real estate, etc)
2. power controlled by those with the most of the cryptocurrency
either way, the power is held by those with the most capital. Like always.

— rat doing whippits (@slimegirlmarx2) December 21, 2021

Some netizens believe that PoS chains are more vulnerable to the buying power of VCs.

Amidst all the commotion, Elon Musk was jokingly looking for Web 3.

Has anyone seen web3? I can’t find it.

— Elon Musk (@elonmusk) December 21, 2021

Ever since Bitcoin arrived on the scene, scores of crypto community members have advocated for a trustless and permissionless economy devoid of a centralized authority.

It resulted in the creation of Decentralized Finance (DeFi) wherein a financial product will not be controlled by a single entity.

DeFi democratized the decision-making process of communities as all the members vote on any decision.

Only if the majority of members ratify any proposal, it will be adopted.

A true permissionless, trustless, and decentralized blockchain would prevent a single player from amassing the majority power, whether mining or staking, through community efforts. The community would take mitigatory measures to prevent it.

On the other side of the spectrum, the price of any crypto asset is determined by the demand-supply. If a single player holds a big chunk of the crypto in circulation, they could only manipulate it as long as there is demand for the asset. No investor would prefer to transact on a network that is compromised.

What do you think is the future of Web 3? Comment below.

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Cover Photo Source: Flickr