How Decentralization Can Win

Oct 5, 2018

Current state of the dApps — not so hot!

If you are not convinced whether decentralization is better for us, check out Chris Dixon’s post on “Why Decentralization Matters”. If you are convinced, then you are probably like me, anxiously waiting for the the killer decentralized apps (dApps) that are able to attract mainstream users and developers.

When CryptoKitties emerged, I anticipated some real traction. Unfortunately, the app’s notable popularity was short-lived. When Kik emerged and raised hundreds of millions of dollars and claimed to have millions of users, I thought they could make a real difference. I have yet to see any real adoption of Kin tokens.

Very few DApps actually have more than 100 daily active users — source

I started off in crypto as an idealist. I thought that people should immediately switch to decentralized technologies for philosophical reasons. I have now come to terms with the fact that even if decentralization is viewed as a good thing, most people still don’t care nearly as much about decentralization as they care about a smooth user experience.

We are becoming more aware as a society of the long-term drawbacks of centralization. There is now public discussion about the consequences of giving all of our personal data and content to profit-driven corporations like Google and Facebook. Sellers commit to sell goods on Amazon because they want to have quick access to a huge established user base, even when they know that Amazon will shamelessly replicate their product as soon as it gains traction. We have also seen the negative effects of supporting sharing economy monopolies like Uber and Airbnb — many small businesses have been negatively impacted and user and service provider satisfaction with many sharing economy platforms is at an all-time low. Despite this, we are still using these services and platforms out of convenience and the lack of better alternatives.

So how can decentralized applications achieve mainstream adoption?

Let’s say I’m an app developer. Putting aside the technical difficulties and the impossible task of recruiting high quality blockchain developers, would I shift to building on the blockchain simply because I believe in decentralization? Probably not. However, would I be willing to integrate certain blockchain-based features that provide value to my users with a few lines of code? Why not?

I foresee mainstream adoption coming from centralized apps gradually integrating components from decentralized services and products. These decentralized components will most likely provide features around payments, identity, messaging, location data, data storage, privacy, etc.

Another important question to ask is when decentralized technology’s user experiences will match, if not exceed, centralized user experiences. I think we are getting closer. Someone recently told me that going “viral” is not just about luck but about removing user and developer friction— the less friction, the higher the possibility of creating a viral product.

When I saw Origin Protocol’s latest demo, I finally fully grasped the impact of what they are doing — they are removing the frictions for mainstream adoption!

Origin is enabling the seamless adoption of crypto and blockchain for regular users and developers by making the integration and end-user experience smooth and easy. I have read Origin’s product brief and whitepaper countless times and heard the team talk about it for months, but seeing it work on my own phone is entirely different than imagining it in my head.

One of the features of their technology is enabling all browsers — mobile and web — to have an in-browser crypto payment function. Users simply download the Origin wallet and approve a prompt to allow the wallet to store information on their mobile or web browser. Any HTML5 apps which have integrated the Origin APIs are now open for crypto transactions without the user having to leave the browser. This makes for a slick and non-interruptive user experience.

Imagine that you have an eCommerce website. Your buyers and sellers can transact without having to rely on PayPal, WeChat or Alipay; they can transact directly, peer-to-peer with the Origin wallet by scanning a QR code on your website. As a platform operator, you don’t have to store users’ sensitive information and be subject to compliance and security scrutiny. Best yet, it’s cheaper for everyone. This is groundbreaking: easier to integrate than traditional payment apps and no middle man collecting fees.

Another feature is a fully decentralized, encrypted, and secure in-browser instant messenger. Once a buyer and a seller have linked their wallets to a browser (see above), they can chat through the messenger and all of the information is encrypted and stored on IPFS. This module can be integrated on any website or dApp. Again, this is groundbreaking: easier to integrate than traditional messaging apps — and users will never lose their messages or have them leaked or read without permission.

Essentially, Origin has created basic decentralized versions of the Stripe, Alipay, and WeChat APIs. It is completely open-source and transparent. Any application can simply plug in the APIs and be instantly functional. Let’s see what this might look like in practice in Origin’s dApp, which serves as a proof-of-concept to other developers.

Here is what Origin’s dApp looks like before logging in. There is no MetaMask required at this point. Users can browse listings but are not yet able to send messages or make purchases.

Here is one of the ways the user can log in. A QR code is generated to allow a user to link their mobile wallet to the browser.

Here is the user scanning the QR code with their smartphone’s camera app.

After approving the link, the user is able to log into the dApp with their unique ID stored as an ERC-725 smart contract on the Ethereum blockchain. The user can now use the browser to make payments or send encrypted messages without requiring MetaMask.

Here the user can manage access to their data via their mobile wallet.

The ability to make any browser a gateway to decentralized applications and technology and the ability to help any existing applications easily incorporate features of decentralization are in my opinion the most effective ways to drive mass adoption.

Origin team members Matthew Liu, Yu Pan, Franck Chastagnol, and Cuong Do were very early engineers and product managers at YouTube. What drove much of YouTube’s early success was the ability to easily embed videos into third party websites like Myspace. The social and viral effect was only achieved when sharing content on multiple social platforms became frictionless. Now this team is leveraging their expertise to try to drive mass adoption of decentralized technologies.

As an active investor in and advisor to crypto projects, I’ve seen a lot of pitches and ideas but not enough execution. I just finished a three week crypto conference tour of Asia, and I have seen how it is becoming more and more difficult for projects to raise money. The current crypto bear market and lack of companies who have delivered products are big factors in this. If you are a blockchain developer or entrepreneur, I implore you to focus on building a real working product. When the market recovers, it will differentiate your project from other ICOs and make fundraising easier. Working with companies like Origin, and incorporating their technologies and modules, whether it’s their mobile wallet, instant messaging, or user identity system, will help you get to market faster. Building on common open source standards will allow for a “shared network effect” that benefits the entire ecosystem.

Now is the perfect time to build. Let’s do this together.

By Melody He, founder and partner at Spartan Group, a blockchain investment fund and advisory firm in Singapore. Disclosure: Melody’s fund is an investor in Origin.