Your mom owns Web 2.0
I promise that this is not all a tech elite rubber-noodle fight. The drama, instead, highlights an interesting issue that venture capital has with the web3 world.
We’ve been gifted another episode of “Tech Versus Tech: Crypto Edition” today.
The argument among the tech elite about just who owns what in the Web 2.0 and web3 worlds continued this weekend. And once again the dustup featured former Twitter CEO Jack Dorsey and a16z, the investing firm best known in recent years for its capital deployments into the blockchain domain.
Dorsey, after pulling the rip cord from his perch atop Twitter and rebranding his fintech firm Square to the more crypto-friendly “Block,” has decided to talk more publicly about his views.
And views he has. The well-known tech exec is a known Bitcoin fan, which you might think would slot in nicely with a16z’s general crypto bullishness.
It does not.
Jack, web3, and who owns what
We dug into the early Dorsey-versus-a16z arguments here, but will provide a summary for those of you who would prefer something brief.
Dorsey’s ideas surrounding Bitcoin are centered around his belief in decentralization as a good. Bitcoin is a reasonably decentralized system. Its founder is out of the picture, it is owned by no single entity, and its community has managed to keep working on the project despite it lacking a traditional leader or external investment.
How does that contrast with web3, the blockchain projects that also trumpet the power and importance of decentralization? Dorsey thinks that web3 is, in fact, centralized due to ownership — control — accruing in the hands of external investors, a16z among them. This is because, unlike with Bitcoin, web3 companies are busy hoovering up venture capital at a rate that is frankly staggering, meaning that many decentralized projects are racking up large external investors in their central holding companies — centralization squared, I suppose.
Dorsey’s complaints about ownership, web3, and the role of external capital in funding so much of the crypto market came to a head in a series of tweets posted between December 20 and 22, with the well-known Twitter user taking potshots at venture capital in crypto more generally, and a16z in particular.
One example for flavor:
You don’t own “web3.”
The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label.
Know what you’re getting into…
— jack
(@jack) December 21, 2021
Them’s fighting words.
So what happened most recently? Well, a16z denizen and prolific Twitter blocker Chris Dixon took a shot back at Dorsey’s argument yesterday with the following:
