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June 19, 2023

Web3 Berlin 2023

Insights on the future of Web3 from Europe’s crypto hub

Europe’s largest Web3 conference Web3 Berlin ended on the weekend, providing valuable insights from the most promising niche players in the region. With recent crypto and Web3 funding setbacks, attendees were eager to discover the next big move that would reignite the industry. Kai Lentmann presents key insights from the conference, focusing on DeFi, Metaverse, and Web3 games.

About the conference

Web3 Berlin took place on the 10-11th June in Berlin, Germany.

Despite being the first of its kind, the organizers were able to attract sponsors such as Solana, Dash and Decentraland and an audience of over 8000 attendees and 300 expert speakers, as their website claims. Besides insightful panel discussions, the conference featured several community meetings and sponsor-led workshops followed by network sessions whose popularity occasionally led to a shortage of exhibitor team members in the main event spaces.

Challenges for Web3/Metaverse Games

My first interview was with Alexey Savchenko, representing Web3 agency X.LA, who participated in a panel discussion on "Future-Ready Monetization: Building Sustainable Revenue in the Metaverse.” The Metaverse represents a popular platform for Web3 games despite the inherent differences between games native to each technology. However, these distinctions can occasionally result in confusion during cross-industry collaborations. On the panel, Savchenko stressed the need for simplification when working with clients introducing the term "Web 3D" as a more understandable wording.

During our interview, he characterized the present state of Web3 games as building on poor mechanics, and he admitted to a lack of encounters with exceptional examples of truly Web3-native games. He explained that the mere transition of successful Web2 games into the Web3 realm is an inadequate measure of success in this domain. He passionately described how several legacy games could be revitalized through Web3-native game mechanics. However, given its recent emergence, with a timeline of just three years, Savchenko maintains a positive outlook pointing to 2026 as a pivotal year for mainstream adoption. He emphasized three significant points for Web3 games to thrive: developing native experiences that fully utilize Web3 technologies, prioritizing the overall user experience, and focusing on community-building.

Our discussion shifted to the challenge of financing and hosting Web3-based Metaverse platforms. Savchenko stressed the importance of improvements in decentralized infrastructure and offered a vision of distributed ownership where users contribute their own resources. Otherwise, a concept for an open Metaverse cannot be realized. Riccardo Sibani, the Chief Product Officer of the Web3 game My Neighbor Alice, offered a different perspective in our interview. The game located in the Metaverse allows users to build virtual islands and purchase in-game assets, similar to platforms like Roblox and Decentraland. For Sibani it is the lack of developer tooling creating the key challenge for the Web3 game industry further advancement.

What sets the project apart is its status as a truly user-owned game. The roadmap includes decentralized governance processes, allowing users to influence the use of revenues, game development, and growth. With full decentralization in mind, the game is running on the relational Chromia blockchain, which encompasses a structure alleviating the storing of NFT metadata on-chain, among other benefits for some of the game’s logic.

The True Web3 Ethos Shines Through

A common theme emerged throughout the conference: a shift away from rapid progress towards carefully considering full decentralization. Pieter Houben from the conference’s sponsor Flamingo Finance, highlighted their DeFi platform's commitment to decentralization by avoidance of KYC requirements through strategically positioned headquarters in Norway - a unique selling point for a DeFi platform. His unwavering belief in the paramount significance of genuine decentralization becomes apparent when discussing the decision to opt for NEO instead of the more high-performing Solana blockchain. He asserts, "NEO hasn't stopped the Blockchain yet. If NEO stopped the Blockchain tomorrow, I would leave.”

Looking into the future of Layer-1 technologies, I am advised by Houben that the projects poised for success will cultivate a robust community that solidifies its dedication through investments in the company rather than unrelated financial assets.

Another aspect reoccurring at the conference is the push towards real-world utility. A notable example comes from Can Inac, the representative of XDC GDCE, showcasing their active involvement in real-world asset tokenization and their ongoing collaboration with the International Trade and Forfaiting Association (ITFA). He elaborates that utility serves as a fundamental principle for XDC, expressing his relief regarding the waning of Web3 initiatives lacking a clear vision of tangible real-world applications. Understanding the considerable influence investors wield over crypto projects, with the potential risk of prioritizing short-term profits over core values, he stresses the importance of meticulously examining potential Web3 VCs’ track records.

Discussions on accessibility also revealed a consensus among interviewees that convenience in Web3 towards the end consumer is still a major challenge throughout all areas. The hindrance posed by KYC mechanisms, cumbersome login processes in Web3 games, and the often cited difficulties faced by non-crypto users in navigating basic tools such as Metamask remains challenges in the eyes of many Web3 companies. We are still in the early stages of the industry as the term "Web3" itself is an evolving concept. Nevertheless, the conference reaffirmed the industry's commitment to the core Web3 principle of prioritizing decentralization.

Final thoughts

Unlike the high-energy party atmosphere commonly associated with crypto-related events, Web3 Berlin Conference had a more serious and thoughtful tone. It was evident that the industry had undergone a change in attitude, with a focus on the technology's potential rather than quick profits. Although Web3 is still evolving and lacks a precise definition, the conference solidified the dedication of true enthusiasts to the fundamental principles of Web3, clearly, a bullish signal in the long run for Web3.

Kai Lentmann
Kai Lentmann
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