TechStuffIt's time once again to revisit the hype cycle and figure out where along the path we might find Web3. And what is Web3? And what the heck is it supposed to do and how is it supposed to work? And why is Jonathan skeptical about the whole thing?
Welcome to tech Stuff, a production from I Heart Radio. Hey there, and welcome to tech Stuff. I'm your host, Jonathan Strickland. I'm an executive producer with I Heart Radio. And how the tech are you? Well? I think it's time once again to consider the hype cycle, largely because we are leading up to south By Southwest and south By Southwest has as part of it a big tech conference and usually you see a lot of height around emerging technologies and that's not always a bad thing, but it can frequently lead to overstating the capabilities of technologies that have not matured yet, and that in itself can end up being dangerous or embarrassing or costly. And so I want to talk about the hype cycle, specifically with regard to Web three. That's gonna be a topic one of many topics of discussion at this year's south By Southwest, as will the metaverse and many other related subjects. So the hype cycle is a concept that is usually presented as a little line chart. If you were to look at one, you would see kind of like an X Y axis and a line would be emerging from the center that's going out to the right, and then it quickly climbs up, peaks, drops off into a valley, and then slowly rises out of that valley to hit a kind of flat section. And the purpose of this is to kind of describe not the evolution of a technology specifically, but rather how people react to and receive certain technologies. And there's no hard set timeline that the hype cycle has to adhere to. It's really more of a description of the stages that the public reception of a technology will go through. It's kind of similar to the stages of grief. So you've probably heard of the stages of grief. Those are denial, anger, bargaining, depression, and then acceptance. And again there's no specific amount of time that's assigned to every stage. Every person will experience the stages of grief on their own timeline, and in fact, the same person might have to go through the grieving process multiple times throughout their lives, and that timeline could be different from instance to instance, so there's not like a set uh length of time for each of these. It's more like this is generally the the process that you go through. Well, in the hype cycle, everything begins with what is called a technology trigger. Typically the trigger is when a technology has been announced or covered by the media early early on while it's still in development, So the tech is not in its final form, it hasn't matured. It may still just be a lot of possibilities and potential, so we know more about what the tech could possibly do rather than what it actually can do. Now, I would argue that Web three falls into this stage where we are between the technology trigger and that peak I was talking about. There are a lot of ideas about what Web three will eventually be, and we'll talk about those later in this episode, but the truth of the matter is it's still something that is coalescing, and so it's really, I would argue, impossible to say what Web three will be because it ain't a thing yet. It's still being developed, and there are a lot of similar are concepts, but they're going about it in slightly different ways. There's no consensus as to what Web three ultimately is going to be. Now, in this early phase in the hype cycle, you end up hearing a lot of buzz about the technology, and this is fed by the media, right the media gets really excited starting to cover the stuff, and that in turn feeds back into people's enthusiasm about the the evolving tech, so people start to imagine potential versions of this technology, like what it will ultimately turn into and what it might be capable of in the future. So, as an example, just recently, I talked about invisibility tech on this very podcast and how through the use of meta materials and some other techniques, researchers have been able to redirect certain bands of electromagnetic radiation to turn a solid object quote unquote invisible, but only invisible two specific small ranges of electromagnetic frequencies. So you might be able to turn something quote unquote invisible to microwaves, but it would still remain visible in the visible light spectrum. So in other words, you as a human being would see that there's an object there, but a device that was using microwaves to detect an object would not see it. They would the microwaves would bend around the object and continue forward as if nothing were there, and so to the microwave detector, there's nothing there, but you would still be able to see the object because it's not invisible to the visible light spectrum. Well, as media outlets started to cover stories about meta materials and these experiments with stuff like microwaves. Then this naturally prompted a lot of what if scenarios projecting into the future, saying, oh, if we can make something invisible to microwaves, then what if you can make a meta material that could redirect all visible eight the same way this microwave experiment is doing with microwaves, Then you would have the equivalent of Wonder Woman's invisible jet, but for real, and that would be a phenomenal method of camouflage. Right you could say, Wow, that's amazing, That's the stuff of science fiction, and people began to get excited about this idea. Meanwhile, you had some researchers who are trying to say stuff like, we are nowhere close to being able to do that, and in fact, we might never be able to cover the entire spectrum of visible light and make something totally invisible to human sight because we may not have a method that works across that spectrum of frequencies. We might be able to cover some of it, but not all of it, which means it would still be visible. It would just appear to be a specific kind of color based upon whatever frequencies were reflecting off of it. But that didn't stop the hype. There were a lot of people who are really excited about it. Now we were heading to the next age of the cycle. This is what Gardner calls the peak of inflated expectations. So this is where we top out where futurists are predicting incredible results based on young, immature, still developing technologies. So they're starting to draw conclusions that don't have enough foundation to be reliable, and investors at this stage might be pouring a ton of money into startups that are developing the technology or looking to exploit the technology in some way. And keep in mind the technology itself it's still not mature, so people are talking about ways they're going to use or exploit the technology before the technology has even been proven to be able to do those things. So this could be so early on in the development of a technology that there's really not much to talk about on a technical level. You're just thinking about the possibilities if that tech chnology comes to pass. So Paraos was definitely in this stage before it all came crashing down with an expose. You had this technology that reportedly was going to be able to run hundreds of different medical tests on a micro drop of blood, a single micro drop, and people were still really jazzed about that and excited and enthusiastic and believing that this was a possibility when the expose showed that things were not as they seemed at the company, and in fact, it had been drastically overpromising what was possible. Next up in the hype cycle, people start to lose confidence in a technology. This can be because the tech is taking longer than people want for it to mature and become a capable tech, or it may be that it is maturing but it doesn't actually have all the features that folks were excited about earlier on the hype cycle, where they find out, oh, it works, but it doesn't work as well as I hoped, or it doesn't do the thing I was hoping it would do. So in short, the reality of this technology is falling short, sometimes fall far short of what the promise was. So when normal folks like like yours truly first got a chance to use virtual reality technology once VR had emerged, and prematurely, some would argue, out of research labs, the results were far more modest than what pop culture had been imagining right in the media, VR was going to be this thing that would would almost literally transport you into the computer world, but the actual experience of using VR was far more limited than that. I would argue that the technology was truly impressive. I mean, having head tracking technology alone blew my mind, and I thought it was super exciting showing what the capabilities were. It's just that the actual implementations were pretty limited. But that didn't discourage me. I just thought, Wow, this technology has so much promise. However, a lot of other people just felt like disappointed and let down that it wasn't the knockout hit right out of the gate that they were expecting, and as a result, they kind of turned on the technology. They dismissed it in the nineties, and that led to the next stage of the hype cycle, which is the trough of disillusionment. This stage is where people have become disenchanted with the technology because it failed to live up to their expectations. Often at this stage, investors will stop supporting companies that are involved in this technology. Ledgling companies that got into the sector often fail at the stage. They just ceased to exist, and technology itself can die at this stage if it's still in the maturation process and has not fully been developed. The technology it's could just lose enough support that there's no one left to develop it. But often you'll have a few holdout companies and organizations that will continue to work on it and keep enough people interested and happy for the cycle to continue development, and VR very nearly died out after the public became disenchanted with it. In the nineties, funding for VR dropped significantly, and research institutions and universities found themselves struggling to support further development. In fact, at this stage, a lot of researchers who are hoping to use VR for some really innovative use cases like treating phobias, for example, they found themselves developing tools by repurposing other technologies. They were looking at game systems like the Wii or the Sony Move controller system and they converted those into VR tools. Or they looked at Microsoft Connect the peripheral for the Xbox, and they took that and repurposed that. Researchers they lacked the resources that they needed to build hardware for themselves, so they were doing their best by repurposing existing hardware that was intended for other uses. And so the work was able to continue, but it was at a pace that was way way slower than earlier on in the hype cycle. So VR could have just died right then and there, but it lived to VR another day. Now. Next up in the hype cycle is the slope of enlightenment. This stage happens as people come to terms with what a technology can actually do, as opposed to all those nebulous potentials that we were dreaming about earlier on in the cycle. Now it may turn out that the tech isn't an incredible solution to all the world's problems, but maybe it turns out to do certain things really well, and as a result, people support the technology more. At this stage, we have a better understanding of what the tech can do, and while it might not enjoy the monumental success everyone was hoping for earlier in the cycle, when everyone had just dollar signs in their eyes, it can have a healthy place in the space. Now we're gonna take a quick break. When we come back, i'll finish up talking about the hype cycle. Then we're gonna focus specifically on Web three. But first these messages. Okay, when we were leaving off, before the messages, we had the slope of enlightenment in the hype cycle. You could actually argue that VR is currently in the slope of enlightenment, that while it survived the trough due to the emergence of the oculus in general, like really the oculus particularly helped a lot, that VR was able to make a recovery and start moving on the slope of enlightenment. Uh. And you might say that, all right, well, maybe it's still on in the slope of enlightenment because while it's more popular than it was in the nineties, it has not achieved mainstream adoption. The VR market is still a fairly niche market. And we see that not just in the sales of VR headsets and and trust me, there have been really good sales, like lots of people have bought them, but we also see it because it's not like we're seeing a ton of really innovative development in VR in the commercial space. The reason for that is a developer is not going to spend the resources needed to create VR experiences if there's not enough of a market out there to make it make business sense to do so, right, You're not gonna make something like it wouldn't make any sense for you to set up a lemonade stand and sell lemonade for twenty five cents of glass. If it turned out that it cost you fifty cents of glass to make a right, you wouldn't You wouldn't do that. You would either mark up the elimonade or you'd say, no, I'm not getting into that racket. I'm doing something else. So that's kind of where VR is now. If it's in the slope of enlightenment, we can still see adoption over time as the technology continues to reach its mature level. And maybe that's where VR is at this moment. It at least is where everyone who's working on the metaverse concept is hoping VR and mixed reality or X are is, because if it is in the slope of enlightenment, it's still moving toward mainstream adoption because the last phase in the cycle is called the plateau of productivity. Plateau tells you people's expectations are not going to really increase from here, right. They pretty much feel that the technology is where it needs to be. It does what it it does, and maybe it's good enough so that it's a really popular technology, or maybe it just ever emerged from a niche market. So this is where we would expect the technology to evolve over time, but those evolutions will be small, Right, You're not going to see a dramatic change generation to generation. It'll just be improving along with other technologies, but not to such a dramatic point that it becomes almost like it's a new tech. I would say the smartphone is definitely in the plateau of productivity phase. Uh. This might be to the chagrin of some Apple fans. There was a time early on in the iPhones life where everyone would wait anxiously each year for the next model's release, because the improvements in generation to generation were fairly significant and easy to understand and see. But the technology reached a mature stage several years back. There are still some Apple fans who expressed disappointment when they go and look at the events where there there's an unveiling of a new model of iPhone, and it's not because the new iPhone models aren't good. Instead, it's because they aren't different enough from earlier ones to feel like a huge leap forward. And early on that wasn't the case, like it felt like every iPhone was a big leap over the past one, but you eventually reach a maturity where those big leaps just aren't gonna come anymore. They'll improve, but not in the same span that you would see in earlier versions. That is the mark of a truly mature technology. Each generation of iPhone has at least some improvements over previous generations, though some design changes may also disappointment you know a subset of users. So, for example, my wife doesn't like facial recognition tech, and so she's still upset that the iPhone ditched the fingerprints since their several generations back. In fact, she resisted buying a new iPhone for a long time, specifically because the newer ones didn't have the finger and sensor. Eventually she gave in, but it was hard fought battle. Now at this plateau, there is a clear understanding of the relevance of the technology. There's an established market for the tech. Adoption of the technology has likely reached close to a saturation point, meaning all the folks who are interested in this technology have bought in, and the folks who are not interested in the technology are not likely to change their minds very easily. VR and XR companies really hope the VR hasn't reached this point of the hype cycle, because if this is where VR is now, then we may never see a mainstream adoption of virtual reality, which in turn would mean that the most visions of the metaverse are built upon a shaky foundation, because if a company's vision of the metaverse incorporates mixed reality in any significant way, well, then it stands to reason that mixed reality itself has to be pretty mainstream, you know, something on the level of smartphones. Like smartphones definitely change the web. The mobile experience with the Web is very different from the desktop and laptop experience, and the metaverse proponents are really hoping that VR will enable the metaverse to have that same kind of transformational effect on how we interact with the online world. But for the metaverse to be more than just an online community for a subset, a small subset of the overall online population, mixed reality needs to be a big thing among the mainstream, and it just isn't yet. All the companies that hope to cash in on the metaverse, whether by providing virtual infrastructure or creating ways to conduct business within the metaverse itself, they can find themselves over extended. If the basic technology needed to access the metaverse never actually takes off, and that is a risk, and some risks end up paying off and others don't. And we don't know which way this one's going to go yet. There are a lot of very smart people who think in the end the metaverse is going to be a big winner, specifically a metaverse that incorporates mixed reality, that it's going to be the way of the future, And you know, they very well. Maybe right now, I say that because I am extremely skeptical that the metaverse, at least that vision of the metaverse, will be the next big thing. But I have also famously been really wrong about prediction stuff in the past, so just counted as skepticism. But that doesn't mean I'm right. I will say that so far I'm right because mixed reality has not become a mainstream technology. It's popular, but not popular enough to be considered even close to as mainstream as cell phones and smartphones. And the reason again that I'm talking about this psycho, which I've done many times on this show, is to emphasize how critical thinking is key to navigating the stages of hype. It is important to ask questions even uncomfortable hard questions as hype ramps up. Those questions can help you avoid disaster, and they can also help shape the path of a technology so that it has the best chance of turning out well. So I want to re emphasize that point too. I'm not just advocating critical thinking because I want people to avoid scams or you know, schemes that end up being based on faulty premises. That is important. I do not want you to get fleeced. That is way up there. But also through being critical, you can give any process the best chance of addressing your concerns, and thus the end product ends up being better because you address the concerns early on instead of having to fix something after it's already been baked in. And if we don't ask the tough questions, then that baking process may go all sorts of wrong, and then the thing we end up with ends up not being as useful or ends up not benefiting the right people, and we just have ourselves to blame because we didn't ask those tough questions. That is what I'm trying to do now with Web three, and I'm gonna be straight with all y'all. Web three still puzzles me. I mean, I understand the big picture stuff about Web three, but I feel we're in that initial part of the hype cycle where we haven't really hit the peak of inflated expectations yet and that we're still headed to the trough of disillusionment. But let me explain, all right, So first, how do we define Web three. There's actually a really big problem here, and part of that problem is that, you know, folks are still working to create what will be Web three, so we don't have a finished thing we can talk about. So again we're dealing with probabilities and possibilities and potential and blue sky dreaming and hype, and it becomes difficult to draw any firm conclusions. Generally speaking, proponents of Web three tend to describe it as the next phase of how we experience the online world. And the easiest way for me to do this is to walk through what Web one and Web two are. So Web one point, oh, the initial version of the web was a worldwide web filled with static web pages, and you would go to a web page you type in the U r L, or maybe you would find it in a in an early search engine, or a link or whatever. You go to this web page, you would read what was written on the web page. Then you would bounce, and there was no real way to interact with the material, and the material itself wouldn't typically change because making changes to a web page was a hassle. You know, you would actually have to go into the HTML code and then change the layout in the text in there, and then you would have to save it and publish it again. There's just a lot of work if you wanted to make changes to a web page, Like if your web page was I don't know about the birth of the British Navy. That was actually one of the first web pages I made when I was fresh out of college. So you could think of this era as the web being in read only mode. You can't make changes to it if you're a user, like you're not the web page administrator, you're just a visitor. You can't do anything that actually changes the web page. You can just read it. That's it. Web two point I would introduce interactivity and user generated content, as well as dynamic elements on the web pages themselves. So now a web page could become a living document. It's one that could actually evolve over time, instead of just being the same page day in and day out. People also developed ways to swap out elements on web pages more easily, so you could update stuff more frequently and with a little less hassle. And sites began to include ways for users to leave their own input, so you can have message boards, you could have user reviews, you could have social network sites. Now the web became read right instead of read only, because now you could actually go to a web page and influence it. You could type stuff in, You could leave a comment on a video, or leave a review for a product, or create a web journal that people could comment on. This was a more interactive web. But something else was also happening during this phase. So in web one point a web pages were these little independent islands. You know. They were hosted on servers, and those servers were all over the place. A single server might host tons of web pages that had no real connection between them other than the fact that they all ultimately quote unquote lived on the same machine. So the web was decentralized, it wasn't concentrated into little like areas. However, with Web two point oh, we saw the emergence of companies that would become monoliths on the web, companies like Google, Amazon, and Facebook slash meta. These companies began to consolidate power and influence, and importantly, they also began to trade in the personal data of folks like us. As we visited various sites, these companies learned more and more about us and our habits and our likes and dislikes, and they use that information in various ways. They used it to sell more effective advertising to their own clients, and they would also buy and sell our data, turning our personal information into a commodity that could be traded. And the Web became a little more centralized around these monoliths. Not necessarily from a technology standpoint, though you do have companies like Amazon, Google, and Microsoft that do big business with cloud based platforms that lots of other services depend upon, But definitely from a market perspective, it became more centralized, and within the context of where our personal information ends up, it became more centralized. Then we finally get to the concept of web three, which some have framed as read right own O W n as and I own that, and that ownership concept extends both to the systems that would make up web three. The organizations that make up Web three as well as our own personal data. So the era of Web three would ideally mean that users would regain control over their own information. Again, that this would not be the commodity for other companies to buy and sell, that transactions across Web three would not include handing over your personal data to some other entity that could exploit it for their own gain at our expense, and that we would actually own a piece of all this through the participation of it. Well, how is that possible? I'll explain when we come back after this break. Okay, So what is it about Web three that enables this ability to own our own information and also to own the systems that make up Web three? While the underlying technology that most Web three proponents point to is the blockchain, and of course that was made famous by bitcoin, and in fact, a lot of Web three talk revolves around cryptocurrencies in general and blockchain in particular, though not all Web three talk includes blockchain, because again we're talking about something that ain't a thing yet, and and some weathere implementations blockchain doesn't really play apart, but in most of them it does. So with blockchain, you typically have blocks of data blocks of information. Each block actually will only hold a certain amount of information, and once it fills up, that block is done. The blockchain system has to confirm or verify the data that's within that block, and then once verified, that block joins the end of a chain of earlier blocks of data. So with Bitcoin, each block's identity is tied to the blocks that came before it, and that means you can't go into the history of bitcoin transactions and change something that happened in the past, because if you make a change, then there's a ripple effect that goes all the way down the chain and every block subsequently added to the chain chain ages as well, and the system would immediately be alerted that something hainky is going on and it could be stopped and reversed. The reason for that is without this protection, where the blocks identity depends upon all the blocks that came before it, well, you could spend a bitcoin and then wait a certain amount of time, then go in and tweak the chain of of data blocks so that you it looks like you didn't spend that bitcoin and that the bitcoin is still in your wallet, and then you could spend it again. So by tying the data all the way through the chain. It prevents you from being able to do those sorts of things. At least theoretically. It gets a little more complicated, but we're not going to dive into all of that. So another important element in bitcoins blockchain is that this this chain of data is publicly viewable by any computer system that's part of this Bitcoin network, and it serves as a ledger of transactions, a record of every transaction made across bitcoin. And because everyone can see the ledger, everyone in the system that is, can see the ledger that keeps things safe, at least in theory. In practice, again, sometimes it doesn't quite play out that way all right. So a Web three system would consist of a computer network, sort of like a peer to peer network, where all the computers are connected with each other through this Web three interface, and they would participate in the operation of a blockchain, perhaps a blockchain that's specific to this Web three based application or organization. This system could meant its own tokens, similar to cryptocurrency or even similar to n f t s, but these are tokens that represent ownership of this particular system. The tokens can be used to reward people, or really reward computers for completing certain tasks, such as verifying a block of data. That's how bitcoin works. That's what bitcoin mining is, is you verify a block of transactions. If you're a computer is the first one to do this by solving an arbitrarily difficult computer problem, then you are awarded a certain number of bitcoin, and it's an incentive to participate in the system and therefore verify transactions. It's this self perpetuating process as long as people find value in the currency. So these tokens can also represent voting power within these Web three organizations. So let me give you a hypothetical. Let's say that you are an investor, and let's say you've got a million dollars to burn and you decide to invest it in a Web three startup. This startup has its own blockchain and it's menting its own tokens on that block chain, and in return for your monetary investment in the Web three startup, the company issues you one hundred thousand tokens on this blockchain to represent that investment. We'll just call them techy tokens. It's the tech stuff currency. So these tokens represent not just your investment, they also represent your voting power within the organization itself. It's kind of like buying shares in a publicly traded company. The more shares you buy, the more voting power you have. So now when it comes time to make a decision for the direction of the organization, let's say you've get yourself one hundred thousand votes. Because we're just simplifying this, we're saying one token grants you one vote in the system, you have a hundred thousand tokens, so you have a hundred thousand votes. But this is just for the purposes of this example. So let's say there's someone else who's joined this network, but they have earned their tokens organically. They haven't poured a million dollars of investments in. They've just and participating. Maybe they've verified some transactions, They've got a couple of tokens have been awarded to them, so they have one or two votes. You have a hundred thousand votes. This is where some Web three critics jump in. They point out that venture capitalists, by investing into these systems, are effectively making themselves into the monoliths that companies like Google and Meta serve as in the Web two point O world. That sure, in theory, everyone who participates within a given Web three system is partly an owner of that system. But some folks are going to own such a large number of tokens that effectively they dictate the decision making process for the overall organization, and everybody else doesn't have any real power. So it doesn't become decentralized. It is centralized. It's just centralized with different people. These organizations also have a name. The thing we call these organizations, these Web three based ones. Typically we call them dowels. Now I'm not talking about DOW as in the Dow Jones Industrial Average, that's d o W. I'm talking d a O. That stands for decentralized autonomous organization. It is decentralized, though perhaps to an arbitrary degree, because ownership spreads across the members of the organization, as opposed to there being say a CEO. Right, you don't have a clearly defined leader of this organization. Though again, in practice, if there's an investor who has essentially bought their their powerful way through by acquiring more tokens than anyone else, than effectively you're in the same position, but at least conceptually, it's decentralized. It's autonomous because it operates based off rules that have been encoded as computer processes. And it's an organization because because it's organized. But wait, if a doll runs off computer rules, then where does voting come into play? What does that mean? Well, the voting power determines what those computer processes actually are doing, so essentially you decide what the rules are through voting. And there are some serious challenges with this kind of organization. So, for one, if members are inactive, if you've got a lot of people who own tokens but they're not actively voting, it can become difficult or even impossible to pass a vote with the needed amount of support to enact change just because the people who own the votes aren't voting. If you've got a whale or two in the system, people who have accumulated way more votes than the rest of the community collectively, then they effectively can dictate whatever the dowel does or doesn't do, without regard of whatever the rest of the community wants. And you might be thinking, all this sounds pretty vague, like I'm getting the general idea, but you're you're not being specific, and you are right. That's one of my biggest frustrations when I read about Web three stuff, or whenever I watch explainer videos on it, because I've watched a lot, I kept thinking, I'm not getting it, there's something I'm missing. And there's a lot of conversation around these ideas, along with other blockchain related stuff like n f t s, but there are very few explainers that include specifics. At most, you might get something like you pay an artist with some tokens for some digital art and you don't have to worry about your data being shared. I'm like, well, that's okay, But I could do a lot of stuff on the web. There's so much I can do on the web. How does that work in a Web three environment? How is that manifested on Web three? What does that look like? And it's hard to find really good examples of how a Web three implementation would play out in the real world, probably because we are in that nebulous phase where Web three is not a full thing yet, and I've seen a lot from the hype side. I've seen a lot from the technical side of how stuff works at a code level, with concepts like smart contracts, but getting beyond that, to get to like specific give me real world examples of how this would play out and be useful, how it would be a benefit and better than the way it works now. Then it gets really hard to find specific examples. I think a lot of people, including myself, ultimately just want to know what using Web three really would mean in a day to day life and how it would play out and why it would be better. One question that also has to be answered is will the blockchain approach be a scalable one? And if it is, then that's great, but it's There are a lot of questions about this, like will building things all around blockchain technology still work once you have grown beyond a niche community. The cryptocurrency community is huge, but is not as huge as like the general population of folks who are using the Internet, and some transactions on certain blockchains like bitcoins, for example, they take a while to verify and thus they take a while to resolve the transaction, and due to volatility in cryptocurrency value, a transaction can actually take long enough to resolve that the amount of bitcoin that you've spent can have a drastically different value in say US dollars than it did when you initiated that transaction. So let's put that in a real world example, as if you were just using your regular currency. I'm going to use US dollars because I'm an American citizen. So I say, imagine you walk into a coffee shop and on the wall you see that a cup of coffee is three dollars, and you had three dollars over to the cashier to buy you a cup of coffee, and you buy your coffee. However, in the process of this, as you are buying your coffee, there is a spike in inflation, and the three dollars that you handed over now has less buying power. It's still three dollar bills, but it can buy less than what it used to. Maybe now it's worth about a dollar in pre inflation money. That would be really bad news for the coffee shop, right because they just got one third of the value in buying power than what they wanted for They would mark their prices up. But this has happened too fast. It happened when the price was set at three dollars, but they got one dollar of value out of that transaction because of inflation. And you would I think the value of the coffee itself hasn't changed, right, The coffee didn't get worse, didn't get better. It's the same coffee. It's worth three dollars of pre inflation, and we can say that because you are willing to spend three dollars to get it. That's what tells us it was worth that much because you were willing to pay it. But the value of the currency has changed. This is an immediate term problem for the coffee shop. And the next time you go and you might look and say, oh, now a cup of coffee is nine dollars because a dollar is worth a third of what it used to be. Now that's a trivial example, it's not realistic for US dollars. But that sort of stuff does happen with cryptocurrencies that are depending upon the amount of time it takes for a transaction to get verified. With bitcoin, you're talking like ten minutes, and the value of bitcoin can actually change fairly significantly within ten minutes depending upon what is going on. So this is one of the reasons why bitcoin doesn't work so well as a as a currency, because you almost feel punished for for spending it. If if the bitcoin is suddenly worth way more than what it was when you started the transaction. Then you're like, well, now I'm throwing money away because this thing wasn't worth as much as what the bitcoin is now worth. Or the flip side, if you're selling something and the value of bitcoin drops, then suddenly the value of what you're getting for selling that thing is different. My whole point here is that by building a web on top of the blockchain, there are challenges associated with scaling this operation up to support a global user base, as well as making sure that the transaction process is fast enough so that people aren't faced with a system that is very slow to respond. That doesn't even get into the challenges that come with larger organizations that have to contend with millions of participants, all of whom have voting power for the direction of the organization itself. Like if these dowels grow truly enormous, then the governance is going to become a nightmare. Everyone gets a vote, some people have more votes than others, and man, it can be really hard to reach consensus. Beyond all that, we then have the bad actors out there who are using the hype around cryptocurrencies and n f t s and Web three and related things to to run scams and steal money and try to cash in on excitement and enthusiasm with no real intent to follow through on that. And these groups are doing more than just fleecing people, which is already bad enough, right Stealing money is already bad. But what they're also doing is damaging the image of these technologies, and if the images get damaged enough, folks will withdraw support and then stuff will fizzle out, kind of like VR, and then maybe find themselves on a much more modest path toward maturation if they managed to stick around at all. Ultimately, I think there are some interesting concepts at play with Web three. I think there is value in the concept of Web three, But I also think we're still in the early hype cycle, and that while there's no law that an emerging technology has to go through these various phases that Gardner has identified, there are a lot of other technologies that have followed that specific path. So we've had a lot of precedents, and I think we that if we're to see Web three even accomplish a fraction of the promises that we've been told as people have hyped up Web three. It's going to require a ton of work. Not just a lot of work, but that we're going to have to approach this work in a very methodical way that holds the people and organizations that are building these things accountable. We have to we have to also acknowledge the challenges and the pitfalls around us, and only then will we have a chance of building something that could have an overall benefit for everyone, as opposed to just finding a new way to benefit a select few at the expense of the many, which is where I think we're going. But we could avoid that if we're super careful. I just don't have a lot of confidence that that is going to happen. And I'm skeptical we're going to see a truly useful, beneficial Web three. Not that we won't see a Web three at all, but that will see a good one. I remain skeptical of that. However, I think it's possible that it could happen. It's just hard to do, and in my opinion, it will be impossible to do unless we continue to ask hard questions and rely on critical thinking. That is always going to be key. So hope for the best, prepare for the worst and question everything is what it comes down to, and be compassionate along the way. Some people are definitely out there to scam you, but not everyone is. And I don't think you should necessarily start off with the base assumption that everyone's out to get me and I just got to figure out what their angle is. I don't think that's necessary. Really the right approach either use a little compassion at least until someone proves that they aren't they are deserving of that compassion, and then I don't know, go a hole hog, knock yourself out. All right. That's it for this, And it was top of my mind again because south By Southwest is coming up. I am going to south By Southwest. I will be there. I will talk more about it as we get closer, because I you know, details are still being worked out, so I want to make sure that those details are hammered out and figured out before I mentioned anything, because I'd hate to tell folks when and where I'm going to be someplace and then it falls through. But once those are solidified, I will share them. And I don't know what I'm talking about yet. If it's Web three, you'll probably here and you're there you'll probably hear something very similar to what I said now, except much shorter, because I'll be one of several people, and uh, I'll try to be more concise. You know me. That's never gonna happen. They'll just turn my mic off. It'll be fine, all right. If you have suggestions for future topics for tech Stuff, reach out to me let me know. You can do that on Twitter. Just send a message to text stuff hs W. That's the handle we use for this show, let me know, or you can download the I Heart Radio app. It is free to download. It's free to use if you navigate over to tech Stuff by typing it into the search bar. You will see on the tech stuff page there's this little microphone icon. Click on that. You can leave a voice message up to thirty seconds and link Let me know what you would like to hear in the future, and I'll talk to you again really soon. Text Stuff is an I heart Radio production. For more podcasts from my heart Radio, visit the i Heart Radio app, Apple Podcasts, or wherever you listen to your favorite shows.
