Thinking Web3 use cases

Ask what is web3. and many would sum it up as trading cryptocurrency in some centralized exchange. They might tell you how they owned BTC, and ETH and adjusted their positions before crypto winter.

Well, that is a great skill in itself and they are early. We must acknowledge their efforts to learn about crypto and participate actively. If they have netted a positive position in their crypto investment journey, it was certainly not an easy task and demands huge applause. This feat cannot be achieved without a broad skill sets like that of a day trader or a hedge fund manager. Also, one needs a brave heart to hold on during the free falls of markets. I can bet, the adrenaline rush is no less than that of skydiving.

But, Web3 is a technology that will have a much broader impact on our lives. A few decades back when an email service or a social media provider offered us a free account, we gave away a lot of personal information in exchange for that free account.

How did we all missed the barter system foundation and not ask what they were getting in return, let's accept that as our failure. But I do realize, it is a problem even after this awareness. Let's accept we are humans and we will make mistakes. We need a way to control and contain such mistakes.

Web3 is a technology backed by mathematics/cryptography that instils faith to believe in yourself and eliminates the need to trust others(individuals, companies, etc), irrespective of how big or reputed they are. Technology gives your control over assets and data that you own and lets you remain in charge permanently.

That means we can fix our mistakes in my words.

Hence, the beginning of trustless systems across many walks of our lives. They are in the making, evolving which will redefine how we interact and transact in our lives in the days to come.

a) DEFI

DEFI, decentralized finance is probably the largest space where Web3 technology is being applied to. We all borrow or lend our money/assets to generate more wealth while manifesting to exit the rat race someday. But, the service layer has grown so fat, that most of the generated revenue has to be shared with institutions that act as intermediaries.

As an example, Let's say, I need a 50K USD loan and my neighbour has 60K USD sitting in his bank account. He could give me, but there is no assurance that he will get it back. His bank acts as an intermediary and is willing to give me my 50K USD loan but asks for 8% interest per annum. I don't have a choice. My neighbour gets 2% interest on his 50K now locked as a loan and 1% on 10K which is fluid.

If you want to understand Web3 technology, ask this one question? Where is the 6% interest going?

Web3 technology with its mathematics could replace the bank. I and my neighbour could have a choice where I pay 4% interest and 3.5% is earned by my neighbour. That is the kind of sweet deal that Web3 technology is prompting us to envision and build, adapt and adopt.

Use cases in defi are

i) Borrow and lending

ii) Staking and rewards

and many more, only limited by innovative thinking.

b) Payments

Primarily, the cross-border payments rely on Swift which is a messaging system. Funds moving cross-border use Nostro and Vostro accounts to settle funds and it takes a couple of days to reflect in the receiver's account. Behind this slow system, banks charge their customer for foreign exchange exposure, the involvement of multiple parties on top of delay.

I remember, before the internet days, we use to communicate with our relatives via a postal card delivery service. It use to take a few days, but we use to get the message in the end.

The question is, in the era of mobile communication, where we can see a live feed of a sports game on mobile, why the bank transfer still takes a few days? Is that aligning to today's technology advancements ?

Web3 technology can change this. Ripple, a blockchain technology company can transfer funds from one country to another in 3 seconds.

c) Identity Management

Web3 Identity Management enhances data security, faster verification, prevent fraud and reduces cost. Identity management has broad use cases from the health industry for medical records to subscription-based services like Netflix.

Imagine, you subscribe to a Netflix-like service and pay only for the videos you watched. Subscribing alone should not cost you more than a fraction, but viewing should.

Also, the service provider gets to manage the price dynamically based on demand to keep them afloat and so is the content creator. This will instil the desire among content creators to create uniqueness as the deal is not one-time any more.

The service provider also does not have to pay the price at the beginning and bet on his success/failure.

d) Tokenization

Last time, I went to a resort with my family for 3 days, I had to pay a sizable amount for the stay. At that time, I wished if could own such a resort and live on that income. Well, that is a natural thought probably everyone visiting there would have. Of course who does not want a passive income?

But, after reading about web3, I aligned my wishful thinking from owning a full resort to "Just own a room" in the resort that will earn passive income for me.

With tokenization, this is going to be possible.

A builder of a resort can, instead of taking the loan for the whole resort from a single entity like a bank, he could break the resort into multiple micro assets. He can then sell each asset independently to different people while tracking the ownership of each micro asset in Web 3 technology.

I could buy a room or two to secure my future. Someone could buy the restaurant or swimming pool or even the parking lot. Each of these micro assets is represented by a token, a Room NFT for reference.

Each of these micro assets could have a charge which is applicable only on use.

At some point in future, I could sell the Room NFT to someone else in the open market to invest somewhere else. The new owner of Room NFT will now get the revenue and I will not get any more as I don't own that asset.

Tokenization has many such use cases, where there is fractional ownership, you can apply tokenization.

e) Supply Chain

Today, when you buy a car, you have to choose the colour, engine spec, seating etc at the time of booking. Based on these, the dealer tells you an estimated date of delivery. The dealer has access to internal systems that track each of these assets, the stock, the order in the queue, and the estimated times for delivery from auxiliary spare parts suppliers.

Using these choices differently could change the delivery date.

If this information was put on web3, you can reconfigure the specification potentially at any time until the car was physically delivered.

I see a new market possibility where, in exchange for my willingness to wait, I could allow someone to reprioritize their delivery for a special date like a birthday or marriage anniversary.

Of course, I will be rewarded for my patience, I remember the barter system foundation now.

f) Social footprint

Today, after completing a certification, I am going and publishing my new skill set on Linked In. It is a self-declaration. Let's say, an employer wants to validate if that was a fact, the certifying authority will have to confirm back to the employer that it is true as verification.

If all educational institutions publish certifications on web3 while attaching the student to each certification, then the verification process is not required any more.

In addition, educational institutions can also store background data supporting the performance in tests that backs the grades the student was given.

For employers, it will be possible to deep dive into the strengths and weaknesses of each student. Instead of looking at a GPA alone, the employer deep dive into each subject and review the performance of the candidate in that subject.

This allows employers and candidates to find a better match for long-term success.

g) Metaverse

For those who did not hear about it, Metaverse is already here. I have attended a few welcome parties, and launches of educational courses in the metaverse.

Metaverse can be described as the gamification of activities that we perform using augmented reality. Sensing your body moments, the virtual you is rendered in a digital environment. It is not only about rendering you in the digital environment but allowing you to interact with digital elements.

This technology is still maturing, but expectations are that once matured, it will render real-life-like environments to interact with.

There are numerous possibilities with this technology, we can start with a few examples.

a) Shopping Mall

A world Metaverse shopping mall where top brands of the world will display their top products in these malls. Launch events for new products can be in Metaverse in future. Shops, billboards, and open spaces around the mall could be tokenized and sold to individuals to earn rentals.

Visit versex website:

https://www.versex.io/versex-areas?pgid=l3h9bzrx1-18b6083d-6b90-475b-8b41-89b7f755820e

b) Fashion Shows

Fashion shows could be conducted in Metaverse and mannequin which is not a statue, but real-life personality could be owned by individuals like you and me. The brands might hire these mannequins for fashion shows.

https://www.youtube.com/watch?v=_yync2CsHIc

c) Music Artists Arena

Many talented people in fine arts do not get a fair chance to show their talent. One of the reasons is the limited resources and time available. With Metaverse, using a 24/7 music artist arena, all these talented people could get a chance to show their talent to the whole world. Someone in the world might like their unique skill.

If the talent is recognised by people around the world, these talented people can be funded by their fans to pursue commercial projects. In return, the fans will get a share in the success. Tokenization is the mantra here too. The artist can issue a token, which can be bought by fans to support, while the artist can build value.

The value can be redeemed by the fan at any point in time at his discretion.

A wealth of information at AuditOne

AuditOne has a repository of information that helped me through the journey to grasp some of these key concepts.

Please refer to the below link.

auditone.notion.site/auditone/bb52d390910e4..

To learn more about AuditOne, visit their website.

auditone.io

They also conduct quizzes and CTF challenges which help in verifying the progress, and also a great place to meet like-minded people. Join their discord channel to explore more.