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Continuations by Albert Wenger : Crypto Tokens and the Coming Age of Protocol...

Jan 10, 2024, 6 min read

Continuations by Albert Wenger : Crypto Tokens and the Coming Age of Protocol…

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Highlights

  • I can’t emphasize enough how radical a change this is to the past. Historically the only way to make money from a protocol was to create software that implemented it and then try to sell this software (or more recently to host it). Since the creation of this software (e.g. web server/browser) is a separate act many of the researchers who have created some of the most successful protocols in use today have had little direct financial gain. With tokens, however, the creators of a protocol can “monetize” it directly and will in fact benefit more as others build businesses on top of that protocol.
  • Because the protocol is public (by definition) if a creator tries to retain too many tokens there is an incentive for everyone else to replicate the protocol with a new token none of which is retained.
  • More generally, the evolution of these protocols will be governed by the decision of those who have adopted it to adopt a future version. This has the potential to provide a much more democratic process for changing protocols over time then the historic committee process.
  • HTTP as the underlying protocol of the web allows for decentralized publishing. Anyone can operate a web server and publish their own content. And anybody with a web browser can access that content (subject to governments and ISPs imposing limitations). But as a stateless protocol, HTTP needs a data layer for any application functionality, which until recently was provided by companies such as Google (search), Facebook and Twitter (social), Amazon and eBay (commerce). Because we didn’t know how to maintain state in a decentralized fashion it was the data layer that was driving the centralization of the web that we have observed.

title: “Continuations by Albert Wenger : Crypto Tokens and the Coming Age of Protocol…” author: continuations.com url: https://continuations.com/post/148098927445/crypto-tokens-and-the-age-of-protocol-innovation date: 2022-02-15 source: web_clipper tags: media/articles

Continuations by Albert Wenger : Crypto Tokens and the Coming Age of Protocol…

rw-book-cover

Metadata

Highlights

  • I can’t emphasize enough how radical a change this is to the past. Historically the only way to make money from a protocol was to create software that implemented it and then try to sell this software (or more recently to host it). Since the creation of this software (e.g. web server/browser) is a separate act many of the researchers who have created some of the most successful protocols in use today have had little direct financial gain. With tokens, however, the creators of a protocol can “monetize” it directly and will in fact benefit more as others build businesses on top of that protocol.
  • Because the protocol is public (by definition) if a creator tries to retain too many tokens there is an incentive for everyone else to replicate the protocol with a new token none of which is retained.
  • More generally, the evolution of these protocols will be governed by the decision of those who have adopted it to adopt a future version. This has the potential to provide a much more democratic process for changing protocols over time then the historic committee process.
  • HTTP as the underlying protocol of the web allows for decentralized publishing. Anyone can operate a web server and publish their own content. And anybody with a web browser can access that content (subject to governments and ISPs imposing limitations). But as a stateless protocol, HTTP needs a data layer for any application functionality, which until recently was provided by companies such as Google (search), Facebook and Twitter (social), Amazon and eBay (commerce). Because we didn’t know how to maintain state in a decentralized fashion it was the data layer that was driving the centralization of the web that we have observed.

title: “Continuations by Albert Wenger : Crypto Tokens and the Coming Age of Protocol…” author: “continuations.com” url: ”https://continuations.com/post/148098927445/crypto-tokens-and-the-age-of-protocol-innovation” date: 2023-12-19 source: web_clipper tags: media/articles

Continuations by Albert Wenger : Crypto Tokens and the Coming Age of Protocol…

rw-book-cover

Metadata

Highlights

  • I can’t emphasize enough how radical a change this is to the past. Historically the only way to make money from a protocol was to create software that implemented it and then try to sell this software (or more recently to host it). Since the creation of this software (e.g. web server/browser) is a separate act many of the researchers who have created some of the most successful protocols in use today have had little direct financial gain. With tokens, however, the creators of a protocol can “monetize” it directly and will in fact benefit more as others build businesses on top of that protocol.
  • Because the protocol is public (by definition) if a creator tries to retain too many tokens there is an incentive for everyone else to replicate the protocol with a new token none of which is retained.
  • More generally, the evolution of these protocols will be governed by the decision of those who have adopted it to adopt a future version. This has the potential to provide a much more democratic process for changing protocols over time then the historic committee process.
  • HTTP as the underlying protocol of the web allows for decentralized publishing. Anyone can operate a web server and publish their own content. And anybody with a web browser can access that content (subject to governments and ISPs imposing limitations). But as a stateless protocol, HTTP needs a data layer for any application functionality, which until recently was provided by companies such as Google (search), Facebook and Twitter (social), Amazon and eBay (commerce). Because we didn’t know how to maintain state in a decentralized fashion it was the data layer that was driving the centralization of the web that we have observed.

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