Should users of crypto-applications understand what they're using?
|Jun 2||Public post|| 1|
The NFTY News tracks the ever-evolving narrative of how the mainstream will enter crypto through user applications. In each edition I explore dApps and the ecosystem affecting consumer crypto applications.
It’s becoming increasingly clear over the past year that many in the community believe that all decentralized applications should look like regular applications of the web today. Many projects have been moving to full-stack user experience solutions (keys & gas natively-integrated into the user experience) in order to appeal to users outside of the crypto community. DLive and Voice immediately come to mind as examples.
While dApps like Dharma are positioned to do this, the majority of dApps should not seek to re-create their own full-stack user experience solutions. If they do, the majority of users will think they’re playing with money in a closed ecosystem as opposed to an open ecosystem. Additionally, the habit pattern of using a Chrome extension/mobile wallet is drastically different than a full-stack solution, and can hurt the wider ecosystem if dApps create user experience solutions for their own benefit.
Compound is a great example of creating an open ecosystem on Ethereum and embracing the fact that they are a dApp as opposed to an app. cDAI and cREP make these tokens distinguishable in third-party wallets, eliminating the confusion of how their balance is changing over time.
Each user has an opportunity cost of whether they should deploy capital in a specific contract or separate application since each contract is it’s own market. While creating a full-stack user experience to appear like an application may garner more users due to lack of friction, it will also create information asymmetry causing the investor to miss out on better investment opportunities, due to the psychological barrier of being closed a closed system.
Ironically, the biggest opportunity in the crypto space is creating an application where the user knows they have write access to a contract (the ability to create their own markets). Developers should be optimizing for cohesiveness with other players in the space rather than creating wasteland of decentralized counterparts to existing applications today.
Disclaimer: I work on helping create a world of infinite possibility at Dapper Labs. All opinions are my own and don’t represent the opinions of Dapper Labs.