194 - How Crypto Saves The Internet | Li Jin & Eugene Wei
Oct 30, 2023
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Li Jin and Eugene Wei, two experts in crypto and web2, discuss the future of status as a service, psychological ownership, and the ties between crypto and social. They explore the impact of algorithms on social media behavior, the evolution of social networks, and the need for new approaches in the crypto space. They also touch upon the concept of ownership in crypto social platforms and the blending of finance and social capital. This podcast provides valuable insights into the intersection of web2 and web3.
The current state of social media is in need of change due to factors such as a new business model, ownership, crypto, and user frustration with the existing paradigm.
Engagement algorithms in social media platforms have shaped user behavior and emotions, resulting in a sense of being trapped and controlled, and negative impacts such as information distortion and addictive behavior.
Web 3 and crypto have the potential to address the limitations of Web 2, with ownership being a key component in the new social paradigm, showcased through examples like NFTs and decentralized platforms.
Fostering strong psychological ownership is crucial for the success of crypto social platforms, which can be achieved by allowing users to invest time and effort, providing control and agency, and aligning with users' values and self-image.
Deep dives
The Primed Opportunity for a New Social Era
The speaker emphasizes that the current state of social media is ripe for change. Factors such as a new business model, ownership, a new computing platform, crypto, and a new generation of users frustrated with the existing social paradigm all contribute to the need for something new.
Web 2's Engagement Algorithms and their Impact
The speaker highlights how engagement algorithms, a crucial part of social media platforms, have shaped our behavior and emotions. They discuss how users feel trapped and controlled, dancing to the algorithms' tunes. The negative impact of social media, such as information distortion and addictive behavior, is touched upon.
The Transition to Web 3 and Ownership as a Key Element
The podcast discusses the potential for Web 3 and crypto to address the limitations of Web 2. The focus is on ownership as a key component in the new social paradigm. Examples like NFTs, tokenized communities, and decentralized platforms are highlighted to showcase how ownership can revolutionize the social experience.
Building for Love or Fame in Crypto Social
The podcast explores the concept of love and fame as drivers in the crypto social space. The distinction between a love product, deepening connections in intimate circles, and a fame product, garnering reach and status, is emphasized. While most current crypto social products lean towards love, there is potential for fame-oriented platforms as adoption grows.
Building Psychological Ownership in Crypto Social
Building strong psychological ownership is crucial for the success of crypto social platforms. Users should feel a deep sense of attachment and affinity towards the product beyond mere legal ownership. Some strategies to foster psychological ownership include allowing users to invest time, energy, and effort into the product, giving them a sense of control and agency, providing opportunities for intimate knowledge of the product's features, and aligning the product with users' values and self-image. By prioritizing psychological ownership, crypto social platforms can create more meaningful and engaging user experiences that go beyond speculative financial incentives.
The Potential of Web3 Social Platforms
Web3 social platforms have the potential to revolutionize the way we connect and interact online. Unlike traditional social networks, which prioritize advertising-driven business models and superficial content, crypto social platforms can focus on value creation, fostering strong communities, and supporting niche interests. These platforms can provide opportunities for creators to monetize their expertise and build sustainable careers based on their contributions and the affinity of their audience. By treating attention as differentiated and enabling different forms of ownership, crypto social platforms can offer diverse and meaningful experiences that align with users' values and needs.
Building a New Social Paradigm with Web3
Web3 has the potential to build a new social paradigm that breaks free from the limitations of current web2 social networks. By leveraging blockchain technology and token models, crypto social platforms can create networks that prioritize trust, ownership, and decentralized governance. Values such as decentralization, collaboration, and knowledge sharing can be at the core of these platforms, enabling new forms of social connections and interaction. With the ability to align incentives, foster psychological ownership, and focus on authentic community building, web3 social platforms can challenge the existing centralized social media landscape and create an internet that is more equitable, engaging, and user-centric.
Many of our listeners are familiar with Li Jin, an investor and co-founder of Variant Fund and is one of our favorite thinkers on crypto and the creator economy. Li is also joined by Eugene Wei. He’s a web2 product visionary. Listeners may be familiar with some of his incredible blog posts such as, “Status as a Service”, “Invisible Asymptotes”, “Why Information Grows” and more.
In today’s episode, these two gigabrains, one from web2 social, one from web3 crypto, talk about the future of status as a service, psychological ownership, and the future ties between social and crypto.
0:00 Intro 8:00 Web2 Social History 18:55 Is Web2 Ending? 24:50 Network Effect Theory 27:45 3 Paths to Break Free 32:17 The Internet’s Good, Bad, & Ugly 41:48 The Algorithm’s Constraints 46:25 Web2 to Web3 Learning Lessons 54:40 Love vs. Fame 1:00:24 Web3’s Potential 1:07:00 Crypto's Social vs. Financial Problem 1:19:30 Ethereum’s Social Network 1:25:14 Increasing Psychological Ownership 1:31:25 Price vs. Psychological Ownership 1:35:00 Eugene’s Advice to Crypto Builders 1:42:00 Li’s Take on Crypto’s Potential Closing & Disclaimers
