Is Web3 eating the software world? Will all future applications be built on web3 and will all the products we know and love be re-platformed onto web3? Or will we see net new applications that could never have existed on traditional platforms?
In our new series BUIDL with the Best, Pillar VC’s Jamie Goldstein sits down with some of our favorite builders to talk about the reality of building on web3 today – what can be decentralized, what must still be centralized, and the implications for builders and users.
Today’s re-platforming? Web3 Uber.
Jamie sat down with Corbin Page, formerly of Consensys and now CEO of Paymagic, a cross-border payment solution targeting DAOs. Corbin spent the early part of his career working for traditional finance companies such as Bridgewater and Millenium. In early 2017, he joined ConsenSys, makers of MetaMask and Infura. Corbin ultimately became Head of Product for FinTech Applications at ConsenSys where he helped build products such as MetaMask Swaps, and MetaMask Institutional.
here are the major takeaways from the conversation:
Humans are walking edge cases
Before we can consider HOW to build web3 Uber, it’s important to first understand whether we SHOULD.
Web3 is well-suited for marketplace businesses like Uber because it facilitates exchanges between two sides of a marketplace, cutting out the middle-man. Connecting drivers with passengers via GPS is a key component of Uber’s platform.
However, Corbin notes that where web3 technology currently thrives is where the use case stays purely in the digital realm or in the on-chain realm, where you can have a lot of trust guarantees. He notes, “the farther you get away from the on-chain or the digital space, humans become involved… and humans are walking edge cases.”
While blockchain is law as code, humans are unpredictable. Adding a human element into the system adds the risk that humans may not follow the same “law”.
So maybe not the perfect use case, but let’s put that aside for a moment… say we were to build web3 Uber, what might make a web3 Uber attractive to users?
Data Portability: Drivers and riders can maintain reputation across platforms
Corbin notes that a key benefit of building Uber on web3 would be allowing drivers and riders to have ownership of their data. Information on ride history, experience, and reputation would be transferable from Uber to web3 versions of Lyft, Hail, Ola, etc. Years of 5-star reputation data wouldn’t need to be rebuilt when transitioning between platforms.
Tokenomics: Drivers and riders can participate in wealth creation
Integrating tokens into the Uber platform would allow for a new level of wealth creation for both drivers and riders. You could imagine tokens being used for a number of different uses cases:
- Accumulating in-app credits or tokens, which could be translated into ownership of the overall platform, or a slice of an Airdrop that the platform eventually launches. “[Drivers] are not just getting paid for the service, they’re getting paid in an asset that’s going to go up in value as the network grows.” Corbin explains.
- Tipping on web3 could be done through NFTs or Tokens to make the ride more enjoyable.
- Ownership of an Uber token would allow drivers and riders to participate in governance of the Uber platform, helping to make decisions about the future of the network.
Transparency: Access to information, increasing trust between Uber and users
Today, Uber controls the algorithm dictating fare prices, and it is hidden from both drivers and passengers. On Web3, this pricing algorithm could be an open formula, open to all in a smart contract. Users could see the pricing history and understand why there may be a surge in prices.
Similarly, Uber hides the algorithm for dictating reputation. In web3, this source code would be fully visible. Corbin explains that if you don’t like the way Uber is pricing a certain behavior, you could take all of your data to a rival platform (see point about data portability above).
The decentralization spectrum
“You don’t necessarily have to have an application that’s completely on the max decentralization scale – especially in early stage startups, you can actually make some centralization tradeoffs to make sure that you’re up and running quickly.” Corbin notes.
While a core tenet of web3 is decentralization, building web3 Uber with current decentralization tools would (likely) mean for a slow and clunky user experience.
He adds, “figure out what you need to do in a decentralized manner, and then figure out what traditional software tools have had, you know, decades of time to mature and get so easy to use, and just use them to get up and running for your early users. It’ll be okay, you can decentralize over time.”
In this example, Corbin would recommend putting the token and the pricing algorithm on blockchain to start, while keeping much of the remainder on centralized systems like AWS or the iOS App Store.
So.. that all sounds pretty good right?
Building Uber on Web3 is possible, but as Corbin mentioned, it will be a matter of deciding how far to go on the decentralization spectrum and the re-platforming.
When humans are involved, and real-world interactions threaten trust in the system, it may lead to a less robust web3 use case.
Maybe we should start with a fully digital Uber in the metaverse…