Web3 Application Iterative Logic And Value Opportunities Based On Builder Economics

If the Builder economy is placed at the height of the evolution of human civilization, it will bring about the basis for the transformation of the economic system: clan and tribe (small country with few people, common labor, common distribution), farming civilization (slave owners, monarchs and religion), industrial and commercial civilization ( Capital and politicians), technology/information civilization (technology, capital and politicians), digital civilization (user Builder co-construction and sharing in the blockchain/Web3 era), interstellar civilization (unknown)…

We have the opportunity to write a new narrative chapter for human beings “until civilization” with “blockchain/Web3 distributed/decentralized, token incentive mechanism/Builder economy, smart contract/DAO organizational governance structure”, and it can even be coherent Sexually look forward to the interstellar civilization after the digital civilization (human beings will have the ability to chase the stars and seas only after they have completed digital advancement).

In the historical view of the advancement of human civilization, the evolution of civilization is driven by the adaptation and transformation of the environment by the survivors.

Then, in the era of digital civilization, the iteration of individual survival paradigm/labor value and the entire ecosystem, economic structure/production relationship will be of decisive significance. We should first enter into the construction of Web3 infrastructure based on how Builder users play a spontaneous construction role based on interests and expertise in the digital civilization/Web3 ecology and obtain corresponding status and value returns with their contributions.

After the discussion salon on breaking the three major obstacles of “the integration of Web3 technology and industry production” planned by TheprimediaDAO, we added an interview with SafeTreasury, a one-stop asset management and collaboration platform for Web3, because it is committed to providing Builder users for DAO/Web3 applications.

The contribution of DAO is core to complete the construction of DID elements such as the user’s assets/equity and reputation/reputation, and provide asset management tools on the user chain, and promote the division of labor and cooperation and ecological co-construction of users in DAO/Web3 applications. Analyze the realization path of the Builder economy and the opportunity of systematic value in the iterative process of Web3 application in the context of Web3.

Iteration

Let’s first clarify the concept of the Builder economy in a broad sense, such as Bitcoin mining, DeFi liquidity mining, and PLay2E practices, which are all manifestations of the return on equity of Builder users’ contributions/data association. Therefore, the Builder here is not limited to the developer group but the entire Web3 ecological builder, including miners, developers, creators, operators, etc., who provide valuable labor in the Web3 ecological construction and thus can obtain corresponding rewards. return on equity.

Changes in the universal survival paradigm

In an iterative context, our best comparative effect is the content creator economy. Content creators/Builders in the Web2 era can earn income by doing what they like, and promote the content business realization model of the creator economy, but this is not enough to promote the iteration of the economic structure.

It is not enough to create content for the entire ecology Creators/Builders offer an opportunity to survive a paradigm shift, as there are only limited revenue opportunities available here – only the top 1% of creators with a large number of followers and readings can operate sustainably. For example, 1.4% of Spotify’s musicians account for 90% of revenue; more than half of Twitch’s revenue goes to the top 1% of anchors.

More importantly, it is still an economic relationship in which centralized institutions exploit/harvest labor—the centralized platform in the Web2 era takes most of the economic value contributed by content creators/Builders. For example, record labels and streaming platforms have an almost complete monopoly on market share and content product distribution rights, and a typical music artist can only earn about 10% of licensing royalties.

According to Linktree report data, 35% of content creators in the Web2 era are not able to make ends meet, and 59% have not realized content monetization at all. Watashi, the founder of SafeTreasury, has nearly ten years of product design and management experience in the Web2 era and has devoted himself to the project practice and community building of the NFT trading market. He believes that Web3 is deriving the content creator economy in the Internet era into a kind of laborer/Builder Paradigms of survival in the age of digital civilization.

Take PLay2Earn as an example. Although PLay2Earn has gradually become a speculative/hype gimmick for currency harvesters and is withdrawing from the center of the stage of the Web3 application era (replaced by Web3 games and Metaverse games), it is still a good exercise for us. A digital economic activity that all people can participate in and has the utility of a personal survival paradigm.

Watashi believes that this mainly depends on the blockchain/Web3 providing users with low-cost creation value and high-efficiency asset circulation/transaction. For example, the number of active wallets participating in the native token SLP is used as a proxy for the number of Axie users, which at its peak was close to one million.

Most of these users do not need to master technology and programming language to understand and use complex financial infrastructure, but when they can complete payment through SLP in a few minutes, PLay2Earn is exploring the survival of Web3 laborers/Builders in the iterative process of digital civilization paradigm.

As more and more workers/Builders enter the survival paradigm level of user production behavior, the convenience of asset management and services on the chain is particularly important-this is exactly the problem SafeTreasury wants to solve: read all transactions on the chain and displayed in a more readable way; track all tokens and DeFi assets; support single-signature and multi-signature Gnosis Safe transfers; filter transactions by wallet, label, token, and date; add financial labels to transactions in batches, Remarks can also be added…

After completing the Builder/contributor’s payment based on individual contribution and data recording on the chain, SafeTreasury is still developing DID on the chain, establishing DID elements such as the reputation value of the individual in the community so as to Empower the Builder’s economic process.

Iteration of organizational management form

In the Web2 era, the centralized decision-making and contribution (salary/option) transformation and the iteration of the evaluation system are carried out simultaneously – the practice of DAO/Web3 shows that the characteristics of decentralization, no third party, and anti-censorship can be achieved through crypto technology and the management of social organizations.

There is another way of playing in the form of laborers/Builders – the contribution of laborers/Builders can be recorded, the method of equity settlement is public, and Builders get corresponding value returns according to their contributions, which will definitely motivate members to devote themselves to team building; laborers/Builder.

You can also obtain corresponding authority to participate in community governance and decision-making according to your contribution, which to a certain extent, avoids the influence of subjective factors in single-point decision-making in the centralized era, and further optimizes the economic structure and governance paradigm based on the Builder economy.

The necessity of community quantification mechanism

The founding team of SafeTreasury believes that service contributors should trace the historical data of each contributor. This corresponds to the quantification mechanism and the rights and permissions behind it. Smart contracts and blockchain have brought the Internet into the era of ownership. The contributions owned by users can be directly used in the calculation of users’ rights and interests. In the builder economy, the value of builder contributions is related to the incentives obtained by builders.

To complete a quantitative mechanism suitable for the current community, the community needs to do the following:

• The rights and interests of the builder are not determined by the platform but by the Builder and the community based on objective facts and community positioning.
• The community itself has a clear positioning and vision and measures user contributions with effective and lasting metrics.
• All contributions and behaviors of users in the community can be stored persistently and cannot be changed, and can be proved without a third party. That is, user contributions need to be uploaded to the chain at the right time and in a suitable way.
  After the data is persisted, the builder’s contribution can be analyzed offline to ensure that the builder does not need to focus on his own contribution records and worry about the contribution income and can realize personalized recommendations and analysis.
  The builder’s preferred fields and expertise, as well as work habits, help the builder to participate in the division of labor and collaboration more efficiently within the application.

Path

Look at the economic system in the context of technology, product, and application iteration, and compare the points/equipment incentives of Web2 applications with the token/token incentives of Web3 applications. The points/equipment of Web2 applications can only be circulated and consumed within isolated applications. There is no economic mechanism for investment, consumption and transactions within the application ecosystem.

The contribution/data/assets of Web3 application users belong to the Builder user DID in the form of asset confirmation, such as token/NFT, and can be circulated across protocols and applications. On the basis of consumption/payment/transaction scenarios, it also has investment/ The financial utility of arbitrage.

Each Web3 application is an independent “small country” with a closed-loop economic system, and the Token/token issued by it is the “currency” for the operation of the application/”small country” economic system. Therefore, there must be a singularity at the macro level. The entire Web3 ecosystem has enough applications/”small countries” to operate freely.

Builder users devote themselves to Web3 with their own interests/specialties (close to Marxists’ self-owned and comprehensive development). Ecological co-construction and sharing, and thus support the non-competitive economic ecosystem of digital civilization “small country with few people, mutual benefit and win-win.”

However, from a microscopic point of view, especially in the early stage of Web3 ecological co-construction, a non-competitive economic ecosystem will not be formed spontaneously. On the contrary, there is no “national border”/boundary between applications in the Web3 world. Builder users DID It can be active in multiple competing Web3 applications, so each Web3 application needs to grab more Builder users to participate in the ecological co-construction of its own project.

The founding team of SafeTreasury believes that Web3 applications need to consider how to better motivate Builder users to participate in collaboration and ecological co-construction in a more lasting and in-depth manner when their own token/token incentive mechanism does not yet have a closed-loop economic system/Builder user transactions to survive.

Compared with the one-step “full project token” incentive, the combination of “project token + stable currency + legal currency” will be a better way. The value of a project token is 0 at the initial stage, and only relying on the joint efforts of the builder can the value be continuously consolidated and pushed up. After all, builders are human beings and have real needs in the current environment.

To do this, an eclectic and flexible approach is needed to incentivize contributors. When the value of the project itself is established, and the business flywheel starts to run, then it can gradually switch to the “full project token” incentive, thus forming a self-closed-loop on-chain ecology.

Token incentives are roughly divided into two types: Commitment compensation is more like a formal job. A certain amount of time is invested in the work of DAO every week.

The specific work is continuous and is continuously arranged according to the needs of the organization. It is a requirement for individuals to produce specific results within a fixed time; Retroactive Compensation corresponds to temporary job assignments corresponding to clear work results, usually tasks that can be completed in the short to medium term and are easy to quantify.

Compared with the traditional equity incentive mechanism, the incentive work in the form of tokens has the following advantages:

• High asset liquidity and short time-to-market (no need to wait for an acquisition or IPO)
• Auto-match market compensation (startup equity value tied to company value at the last fundraising round)
• Rewards are more directly related to the company’s technical products and community value and are not subject to the company’s capital structure
• Compensate for loss of employee benefits due to extrinsic factors in different ways (capital gains, payroll taxes and local regulations)
• Obtain basic liquidity from the lending market without triggering taxable events
• Staking, lending and earning incentives for additional tokens
• The token dilution process is transparent. Coordinate feasible scenarios for the total token supply with stakeholders in a transparent manner.

Incentives (and pros and cons) in the web3 community include:

• Retroactive bonuses (funds/tokens), given retroactively to contributors after they contribute (flexible for DAOs, no need for long-term commitments, but high uncertainty for contributors);
• Salary stream (funds/tokens) (could encourage long-term, steady contributions, but not for specific jobs)
• Collective rewards (funds/tokens), which collectively evaluate the rewards that individual contributors deserve (there is a decentralized collective evaluation mechanism, but it makes individuals more uncertain about the rewards they get)
• Governance rights/tokens (to give members a better sense of participation, but the value of governance tokens generally fluctuates greatly)
• Tips (funds/tokens), directly allocated by the central organization (contributors can be rewarded the fastest, but very centralized, and the income may be uncertain);
• Bounty (funds/tokens) (good for some special tasks, but it is difficult to supervise the completion of the task correctly)
• Donation (applicable to incubating complex plans/projects within DAO, and it is also difficult to test the effect)
• NFT (can be used for tickets, and build a reputation system, but limited liquidity)
• SBT (SBT can become a personal reputation certificate, combined with DID to become a resume in the web3 world)

While ensuring the incentive mechanism, this incentive system also tries to solve a very real problem in the early stage of Web3 ecological co-construction – how can a certain Web3 application work when some excellent Builder users do not have other full-time/commission jobs in the real world? On the basis of the Token incentive mechanism, take into account its real survival problems.

For example, a Builder user of ThePrimediaDAO participated in co-research, co-creation, and collaboration more than three times within a month, and the contribution was approximately equal to two independent content investment research and analysis articles. The full-time status participates in co-research and co-creation, so in order to better play its role, an incentive bounty of 600U-1000U is given to it, which not only ensures its survival in the real economic world.

Therefore, effective fund management is as important as on-chain asset management for early Web3 projects. Based on the above analysis, SafeTreasury has formed a collaboration platform serving the Web3 ecology that combines “Web3 application fund management + Builder user chain asset management”.

Therefore, in addition to related services on the chain, SafeTreasury also tries to provide a more transparent financial disclosure solution for Web3 community governance, establish Web3 financial norms and generate financial statements, and create a platform for Builder users and Web3 applications. An aggregator that integrates all assets.

Value

In the long history of human evolution, the formation of each civilization era is a manifestation of the adaptation of the human social order to the changes in the external environment/survival structure. Digital civilization is no exception. Human nature is complex. The laws of the real world are the bottom line of human morality and regulate human social behavior. In the web3 world, smart contracts regulate the behavior of builders and ensure the normal operation of community governance.

The internal coordination and governance of the community require the common values and goals of the members, and the constitution (smart contract) is the interface of the common values.

The main form and structure of the existing DAO constitution: modeled on the concept of the modern constitution, defining powers and responsibilities through clauses; imitating the declaration, expressing values and guidelines to be followed; applying the digital constitution of the community and the Web3 project, to the mentioned goals, values and rights is encoded. This is called computational constitutionalism, where communities are defined by their use of smart contracts.

The constitution acts as a product of decentralization in the community, and decentralization also defines a specific narrative of how the community collaborates. Mainly reflected in: the right to propose, the right to challenge the proposal, the right to vote, the right to non-discrimination and the right to withdraw.

The constitution defines the goals and values of the community. The goals are mainly divided into developing Web3-specific technologies, disseminating technologies to benefit the world, building communities. The values expressed are openness, tolerance, free and decentralization.

The SafeTreasury founding team believes that under reasonable decentralized governance rules, early Builders and contributors can obtain part of the value they help the platform create and ultimately govern and control it more. Essentially handing these companies over to the Builders – this is the biggest socio-social shift that decentralization has created here.

We can imagine that in the process of digital civilization based on Web3 application iteration, this is a new paradigm of living structure, a little more equal and a little more socialist, which allows every Builder to participate in the economic creation that is happening in the world Share with others, and have corresponding social governance rights and interests based on their contribution, instead of restricting it to a few people such as capital/technology/politicians.

Therefore, Web3 applications will greatly release human creativity. While completing the evolution of digital civilization, human beings can also start imagining interstellar civilization…

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your research before investing.

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Harold

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