Last Thursday, Lloyds Banking Group’s Fintech Investment Director Kirsty Rutter named Web3 as a key fintech trend for 2023.
The company representative outlined how Web3, its bespoke communities, and integrated technology present a new avenue for fintech opportunities.
Rutter notes that following from Web2’s user-generated content (UGC) model, Web3’s decentralized infrastructure spreads digital ownership across “builders and users” over “big tech firms” that owned previous iterations of the internet with centralized systems.
Web3 and XR
Many Web3 services integrate augmented, virtual, and mixed reality (AR/VR/MR) content. For example, many Metaverse services, such as Decetraland, The Sandbox, and Horizon, employ decentralized monetization models to fuel bespoke UGC creation.
While the unstable crypto market and seemingly, at times, lonely Metaverse platforms do lead to scepticism about the future of Web3 platforms, examples of successful consumer-grade Web3 and Metaverse opportunities for brands and marketing teams do prevail.
A notable example is NIKELAND, a Metaverse service aimed at younger users and promoting active lifestyles. Nike Digital developed the service with Roblox, providing users with a virtual environment that detects user movement with a smartphone’s AR hardware and accelerometers.
NIKELAND uses Web3 features like NFTs, avatar customization, and virtual events to promote the brand to roughly seven million members from approximately 223 countries – as of August 2022. Moreover, according to the firm’s President and CEO, Jack Donahoe, NIKE Digital’s Web3-based operations comprise 26 percent of the brand.
In November, Nike also launched SWOOSH, a Web3 service to host creative content and promote the brand to new audiences.
Lloyds: Web3 Presents Entirely New Model
Lloyd’s Kirsty Rutter, in her blog post, notes how Web3 and its integrated systems open the potential for an “entirely new model.”
Rutter also added how the development of Web3 services is not complete, explaining that such community-based digital platforms only exist in “small pockets today.”
Although, the Fintech Investment Director explained that Web3 communities present a massive potential for new methods of digital monetization, tokenization, and self-governing decentralized economics.
For example, imagine you and a group of like-minded individuals wanted to create a community (like a Facebook community or a local town club) and then decided that this community should govern itself with its own rules and system of currency. Well in web3, it’s already happening. And could prove to be how each of us engages with all the micro-communities we want to be part of in the future.
While optimistic, Rutter did note how currently, Web3 communities are not at total sophistication. She said Web3 evolution “will not be complete in 2023; it will take longer than that to reach all of us.”
Is Web3 still a Viable Tech Option?
The Web3 landscape is ever-changing as the technology finds its footing.
Within the Web3 landscape exists further integrated technology to support its decentralized digital economies.
A core technology that supports upcoming and in-development Web3 and Metaverse services is the blockchain, also known as Distributed Digital Ledger Technology (DLT).
Whilst crypto currencies have developed a mixed reputation, the technology they operate across (known as Distributed Digital Ledger Technology (DLT) which can be used interchangeably with “blockchain”) has demonstrated its potential for real impact in our everyday economy. Financial institutions, central banks and governments are looking at this together to understand what this could mean.
With other financial institutions like HSBC, Bank of America, and JP Morgan all putting their toes in the market to some degree, the Web3 landscape may expand as more significant and more established fintech firms swoop in.
Rutter also noted how following a rough 2022 for digital currencies, regulators might “devise a global regulatory policy approach” for crypto. Although Rutter did explain that rumours of such a policy approach have been floating around “for a while now.”