Wen | Su Zihua

Editor | Qiao Qian

"Web 3 and blockchain are not equal." Wang Yuehua, partner of Draper Dragon, told 36Kr.

established in 26, draper dragon is a venture capital fund active in China and the United States, covering intelligent manufacturing, biomedicine, blockchain and Web3.

since 215, Draper Dragon has invested in more than 1 projects on the Web3. track, including more than 3 projects in 222. Investment cases include Coinbase, the digital asset exchange, MakersPlace, NFT trading market, and HKbitEX, a digital financial integrated service platform.

according to Gartner, a research organization, Web3 will really explode in 224. However, cruelly speaking, there is still no Web3 application that can be well known by the public, but there are many debates about Web3 in China. For example, whether there is a need for "currency", whether "decentralization" is the goal, where the blockchain should be used, and so on.

so, how does silicon valley understand Web3?

Wang Yuehua's career track is active in Silicon Valley and Asia. Before becoming an investor, Wang Yuehua, an engineer, worked as a research and development, technical support, sales and professional manager. In 211, he founded OLEA Network in Silicon Valley to develop wireless ECG sensors and worked hard in the semiconductor field for nearly 2 years.

From Silicon Valley to China, from semiconductors to artificial intelligence and Web3, Wang Yuehua believes that there are still many misunderstandings about Web3. in the industry.

To this end, he participated in writing a popular science book "Reading Web3." to help readers understand the evolution logic of the Internet from the perspective of entrepreneurship and investment. Taking this opportunity, we chatted with him about the "misunderstanding" and new trends of Web3..

The following is the conversation:

Artificial intelligence is the cornerstone of Web3, and blockchain can be used or not "

36Kr: Blockchain technology seems to have made little progress in recent years.

Wang Yuehua: Indeed. For example, last year, two hot public chains, Sui and Aptos, came out from Facebook's Libra project (released in 219), but there was no big progress in the performance of public chains.

However, I'm still optimistic, and I should be able to see more progress in the next year or two.

36Kr: Do you think there is still a chance to be a new public chain?

Wang Yuehua: If you know how bad the public chain is now, you will know how big the opportunities are.

36Kr: Some web3 projects will issue money, while others will not. Do you have to issue money to do web3 projects?

Wang Yuehua: web3 has nothing to do with money.

many web3 projects revolve around the concept of money. We have been in this field for many years, and we feel that whether there is misunderstanding or deliberate guidance, this is actually not good for the development of the whole market.

Some web3 projects are related to blockchain, which can issue money or choose not to issue money. Moreover, web3 projects do not have to use blockchain technology.

36Kr: Can web3 do without blockchain technology?

Wang Yuehua: The IPFS protocol used to realize distributed storage does not use blockchain technology. Blockchain technology is originally a thing that can be used or not.

36Kr: So, what key technologies do you think web3 contains?

Wang Yuehua: There are three basic elements driving the evolution of Web3: artificial intelligence and intelligent contract technology, edge computing (or distributed computing) and distributed data network.

they are all related. For example, artificial intelligence is the cornerstone of web3. If AI does not progress to a certain extent, web3 will not prosper.

The semantic Internet and spatial Internet that Europe and America often talk about are all based on a certain degree of artificial intelligence. In fact, in all Web3 application scenarios, the data will be processed by algorithms, and the stronger the artificial intelligence, the better the experience.

For edge computing, because the computing and storage functions of each distributed node must be perfect, the data of a Web3 system can be effectively processed, so edge computing is also an important foundation.

The role of Web3. in different technologies | Source: Draper Dragon

"User autonomy is the core of web3, decentralization is not"

36Kr: Now when people talk about Web3, decentralization has become an ultimate goal.

Wang Yuehua: That's a misunderstanding. Web3 can be partially centralized and does not have to be "decentralized".

the core of web 3 should be "user autonomy". Because web3 is based on "decentralized" data. The data source must be decentralized. The so-called "decentralization" means that the user can control the authorization and management of this data, that is, the user is independent.

The difficulty in realizing "user autonomy" for "centralized" services lies not in technology, but in how to convince users that you will listen to them. This is hard to convince users.

but if you are technically decentralized, you have met the requirements in essence, and you don't need to convince. Obviously, "decentralization" is the most convenient way to achieve "user autonomy". Everyone chooses the right way to go.

36Kr: Can "user autonomy" be realized in China?

Wang Yuehua: Complete "user autonomy" is unlikely. But there is a degree of problem, such as achieving 1% user autonomy or 99% user autonomy.

it depends on government departments. Data right involves many dimensions, such as dividend right, management right, management right, etc., and can be divided into hundreds. If any of them involve national security and institutional privacy, it is impossible to allow users to use them.

36Kr: Since web3 doesn't have to be decentralized, how do you understand the relationship between web3 and web2?

Wang Yuehua: During the Web1 period, the Internet was not centralized, because the infrastructure at that time was underdeveloped (for example, there was no cloud computing), so it could not be "centralized" and it was impossible to form a scale monopoly.

in order to pursue efficiency and reduce costs, the platform of Web2 has become centralized. Web2 is nothing more than "centralizing" user accounts and user data. Now, Web3 technology is complete, and centralization can be broken again. Web2 enterprises can return the data rights to users and continue to maintain the original business model, which is no problem.

from Web2 to Web3, there are transitions and iterations, and they are not separated. There are many projects in the United States from Web2 to Web3, which may not be concerned at home.

36Kr: The "functional agreement" often mentioned in Web3, how to understand its commercial value?

Wang Yuehua: The hierarchical structure of Web3. according to "function" means a lot of brand-new business opportunities.

the economic dividend originally attributed to an internet company will be redistributed according to the functional combination. It is no longer possible for various protocols to obtain greater economic benefits through the monopoly of certain resources, especially data resources, but only through the promotion and optimization of functions can they reflect their own values and realize greater benefits. This means more fairness and openness.

more protocols with different attributes and rich functions will get the opportunity to enter the service chain and participate in the distribution of benefits. It is a huge opportunity for the entrepreneurial team.

in addition, a very elaborate incentive system can be established based on smart contracts, which will directly motivate all teams and individuals who have joined or want to join the web3. ecosystem.

(Editor's note: Smart contract is equivalent to coding a section of agreement and putting it on the Internet for execution. The agreement can include rules such as application of gameplay, equity allocation, repurchase terms and so on. )

DAO is not suitable for all types of work

36Kr: DAO still seems unable to get rid of the problem that the organization is made by a few people?

Wang yuehua: DAO is not suitable for all types of jobs, nor for all business models. It is efficient in some cases and inefficient in some cases, depending on what you achieve with it.

DAO mode is more suitable for work collaboration. Many so-called associations in the United States, such as electronic associations and industrial associations, have long used the DAO model to operate, but they are not called DAO and have no smart contracts.

36Kr: what is the ideal DAO?

Wang Yuehua: The core logic of DAO is that everyone is for me and I am for everyone. Its functions and attributes can be realized through the deployment of smart contracts and change with organizational goals. The smart contract is like a pile of Lego bricks, and the members of DAO add up one by one according to the rules. The rights of each member are established according to different dimensions such as contribution, credit rating, participation and so on.

36Kr: What the community achieves is people, and what the company pursues is profit. Therefore, DAO can never make big money, but it can hatch but the team can. Do you agree?

Wang yuehua: DAO is an operating mechanism, not a profit-seeking organization. Properly speaking, DAO can be regarded as a tool and a platform to use.

Web3 industry reshuffles

36Kr: In the past year, Web3 has gone from hot to bear market. What changes have you encountered in the portraits of entrepreneurs?

Wang Yuehua: Most of the entrepreneurs I met in the first half of the year belonged to crypto native. In the second half of the year, many entrepreneurs came from the traditional Internet, such as Ant, Tencent, Ali and Baidu. This is a big change.

crypto native people tend to catch coin users, and their methods of making communities and fans are relatively grassroots and not systematic. Entrepreneurs who transform from Web2, whether doing traffic or product design, have more steady thinking.

36Kr: Over the past year, the NFT transaction volume has been declining. Has the NFT bid farewell to the sky-high price era?

Wang Yuehua: It must be a complete farewell. All along, the NFT mentioned basically belongs to PFP (head portrait, picture class), and the value of PFP is relatively small. Only with functionality can the value be amplified.

NFT should have three attributes: asset, collectible and functional. PFP projects are basically only asset-oriented, and they just seek the recognition of a group to support its value, and its asset-oriented is being driven up.

The biggest market of NFT in the future is functional. It must be functional and useful. The point is to be useful.

36Kr: After the current crypto bear market, which projects do you think will be shuffled out and which projects will remain?

Wang Yuehua: It's easier for companies that do protocols to stay, and those that do applications will be shuffled.

because of the application category, their traffic was originally the traffic of the currency circle. When the bear market comes, these traffic will also run away.

On the contrary, enterprises with traffic in Web2 have opportunities, because they have advantages such as capital and traffic, for example, they can lead traffic to Web3. Some Web2 projects in the United States have switched to Web3, which is very fast because it carries its original traffic.

36Kr: Will the future development space of cryptocurrency become smaller and smaller?

Wang Yuehua: No, it will only be better. Some central banks have issued digital currency, which is not necessarily called cryptocurrency, but they belong to the same category, belonging to digital currency, and will become larger and larger. Once the supervision can keep up with the development of cryptocurrency or digital assets, the government will encourage its development.

36Kr: Why is encryption the future? What is the reason that convinces you the most? Apart from the financing function, token seems useless to the Web3 team.

Wang Yuehua: Encryption is basically a privacy protection. Privacy protection is a basic requirement, because there is no freedom without privacy, and that is definitely the future. The role of Token is actually to open up the possibility of another business model or even business format. As simple as a voucher, a badge, and an asset can all be run in the form of Token.