It’s been a rough week for the crypto community as top tokens have seen massive selloffs, pushing some in the space to double down while leaving others to take stock off how the industry got to this point and what widely accepted truths need to be reevaluated as the crypto internet matures.
There haven’t been many tech executives repeatedly criticizing the idea of what a “web3” crypto internet represents, but Box CEO Aaron Levie has certainly been more vocal than most. Earlier this week, we had the chance to catch up with Levie on TechCrunch’s crypto podcast Chain Reaction, pushing him to dial in on some of the promises surrounding web3 that he was most skeptical about.
You can listen to the full episode below:
“I think the philosophy behind much of web3 is compelling. I think it would be very hard to argue with the idea that more decentralized innovation wouldn’t be a good thing,” Levie told us. “I think the implementation that I’ve seen has a lot of challenges of actually getting to that philosophy being realized.”
Levie isn’t an executive of a crypto startup and he doesn’t seem to be exploring a web3 pivot for Box, but he tells us that he tweets about web3 as much as he does because “by virtue of being a startup founder, you sort of have to understand where the world is going — and then you have to make choices about if you believe the world is actually going in the direction that other people are saying or not.”
Some have looked at the high-profile failures in recent weeks of highly centralized players in the the decentralized world of blockchain as proof that more organizations should be run collectively. Levie doesn’t seem to anticipate DAOs or collective ownership replacing the traditional structures of the startup world anytime soon, though.
“We rely on people in Cupertino to make decisions to build the iPhone and then we get to decide if we want to buy it or not buy it. That’s our only decision that we get to make in the iPhone, we don’t get to vote on anything, and if we voted on anything it would dramatically slow down the system and you just wouldn’t be able to innovate very quickly,” Levie says. “For collective movements, [DAOs] are super exciting, like no arguing that but to replace the organizational structure of a fast-moving startup or company — I just don’t think it’s going to work.”
As crypto VCs push for entrepreneurs to consider the idea of replacing traditional advertising-based business models with tokens and NFTs that push consumers toward owning slices of the services they use, Levie questions how widespread some of those mechanisms actually are.
“We might be over-estimating the consumer demand for ‘ownership,’ and the reason why I can say that is because you get real trade-offs in products when you are deciding that it’s going to be a product where you can own the items versus participate in a network but not really own much,” Levie notes. “I happen to be bullish on the power of advertising because it does make products cheaper and it does facilitate businesses being able to go and find consumers. There are some that take the other side — that’s totally great. I think the question is what’s the size of the market that’s willing to take that trade-off and is the size of the market big enough to warrant talking about a revolution in how the internet works?”