I was confused when someone on our team suggested writing about platforms that are important to Web3 and metaverse because, in my experience, platforms typically follow mature industries. But Web3 is new and nascent, right?
Sort of. Pieces of the Web3 stack are, in fact, not new. Blockchain was first conceived in 1991 and first seen in action in 2008. Digital worlds, now called metaverses, are described in fiction literature since the early 20th century, most famously in Neil Stevenson's 1982 novel Snow Crash. The first virtual reality (VR) headsets emerged in 2010. Digital currencies, art, documents and other assets are as old as computers. The internet infrastructure on which the metaverse depends started in the 1970s and 1980s.
Not Your Father’s Internet
What’s different now is the interest in and potential for integrating these concepts and technologies to create new connected experiences, which is where platforms are important. Elements of the Web3 stack and metaverses don’t just exist; they must be built. And metaverses themselves are also platforms for building experiences.
As my colleague Prashant Kelker expresses, Web3 enables decentralization of business finance, governance and ownership with new tokens and protocols, and with immersive experiences. Depending on what an enterprise wants to build, any or all of the platform categories discussed in this article could be essential – and include some capabilities and considerations not previously needed for Web2. Methodologies for software development are also shifting, so listen out for upcoming discussions about how development practices may evolve to address the needs of Web3 and metaverses.
The Creator Economy Influences Growth
The needs of the Web3 ecosystem are driven by the “creator economy,” which is evolving from influencers in Web2. Fifty million people, most of whom are amateur individuals, consider themselves creators. Some estimate that the global creator market is worth more than $100 billion. To support this kind of economy, there must be a shift in tools and platforms from an engineering focus to a creator focus. The big challenges today are the lack of ease in development and the inability to use the created assets anywhere. Low-code and no-code alternatives are early steps, but interoperability of the involved technologies and applications – like most of the Web3 development world – is limited by the Web2 paradigm.
5 Types of Web3 Platforms
Platforms will help push us from Web2 to Web3. There are five main kinds of platforms, with some overlap between them in terms of solution and market fragmentation. The five include:
- Asset creation. These are the robust platforms that support content creation of 3D, video, games and other digital content. For example, millions of people use games developed with the Unity platform and its 3D engine (ad make money via its ad network). Epic Unreal Engine is a 3D creation platform for complex games. Adobe Substance 3D is part of its creation suite. NVIDIA Omniverse™ Enterprise supports 3D design collaboration and simulation. Matterport is a software platform that enables someone to turn a space into an exact and immersive digital twin that can be used to plan, create, run, promote and analyze any location using its 3D data. YouTube, Twitch, TikTok and lesser known VIMM are video creation platforms.
- Smart contract development and management. Smart contracts are programs that run automatically when certain criteria are satisfied and then they are stored on a blockchain. They are often used to automate the performance of an agreement so all participants can be certain of the conclusion right away, without the need for intermediaries or delays. A smart contract platform has a set of tools that can also create decentralized apps (dApps). These ecosystems can offer their own blockchain with integrated dApps, communities, currencies and wallets. Development tools support workflows, programs, dApps and client SDKs. Some enable cross-blockchain transfers and embed security. Examples are Alchemy, Buildspace, Ethereum, Hive, Moralis, Polkadot and Solana.
- Cryptocurrency control. Some enterprises will want their own private exchange platforms to host coins. Features in solutions such as HollaEx include automated trade matching, operator controls, APIs and code libraries. Buying and selling platforms such as Coinbase and MoonPay offer integration with other platforms. Users' public and private keys are stored in cryptocurrency wallets, which also provide interfaces for managing crypto balances and supporting blockchain-based bitcoin transfers. Some wallets allow users to connect with dApps or perform operations with their crypto assets, such as purchasing and selling.
- Non-fungible tokens (NFT) access. Some platforms serve as marketplaces for buying and selling digital assets, with NFT creation, project building, discovery, trading, collecting and community access. Examples are Blockparty, OpenSea, Mintable and Nifty Gateway. Brand-specific marketplaces are emerging, notably Candy Digital, which is Major League Baseball's official NFT ecosystem to purchase, trade and share officially licensed NFTs. Many NFT marketplaces rely on cryptocurrencies for transactions.
- Metaverses. The user interfaces of Web3 are metaverses. Today, these interactive platforms most often focus on gaming. Roblox is a metaverse with games made by users with its own digital currency. Axie Infinity is a game universe based on collecting fantasy creatures represented by NFTs. The Sandbox is a community-driven platform where creators can monetize voxel / 3D assets and gaming experiences on the blockchain. Other metaverses seek to be virtual worlds for more than gaming. BIZVERSE, Decentraland, Meta Horizon, Somnium Space, Spatial and Stageverse are among those marketing themselves as virtual worlds for advertising, shopping, commerce, socializing, education and training.
ISG has observed an increase in the demand for rapidly adaptable, customer-facing systems of engagement, implying that a growing percentage of enterprises and providers will adopt low-code/no-code platforms and innovate using them. Web3 and metaverse requirements will accelerate this trend. More detail will be in the upcoming ISG Provider Lens study Next-Gen ADM Solutions 2022 – Low-code/No-code Development Platforms.
ISG believes protocols will eventually override the platforms’ importance and utility to Web3. Platforms are walled gardens with central control. By contrast, open protocols allow more decisions to be decentralized and left to communities of users. But as protocols evolve, enterprises seeking to explore Web3 should first experiment with existing tools and platforms, using protocols where practical, and supporting and encouraging protocol and standards development. As the shift to Web3 continues, enterprises should assess how they can best participate and experiment and make progress with the categories of platforms discussed here.
ISG helps companies understand and prepare for new uses of technology in the rapidly evolving world of Web3. Contact us to find out how we can help you.