The future of decentralization will change the internet and democratize information and opportunity for all. I had the chance to sit down with Paul Arssov, found of ARS Technologies, and discuss the effects of decentralization and how his company is one of the pioneers in decentralization and helping to drive meaningful change.
For the full interview, click here!
MP: For my first question, what sparked your interest in decentralization?
PA: As we know, at the beginning of 2020, we were experiencing the beginning of the global pandemic.
And I thought there was going to be an increased need for online communication tools like Zoom, Skype, Google Meet, and other search video and audio communication tools. For example, currently, we're using zoom for this meeting.
I thought that decentralization is the future and an upcoming thing as currently, the internet is very centralized. These platforms are all centralized, like our communication goes to a server, then from me to that server, and then finally from that same server to you. I figured I could start a project that uses decentralized communication from person to person, and it doesn't go to one central server.
MP: It's an excellent point; it helps to democratize the whole process that there's no one person or entity with all the power. My next question is, what made you come up with your idea to take advertising and democratize it using a decentralized system?
PA: Well, every project has to make money somehow, and advertising is a way to monetize things. The project itself has blockchain Instance and crypto tokens, and most blockchain and crypto-related projects rely on offer coins, which supports the project. But lots of those projects get the coin offer and then get very little done after this.
We have the token, but we have an established way of monetizing, establishing a way to generate revenue. Suppose I compare our way of offering digital advertising with traditional digital advertising done by Facebook, Google, Twitter. The current methods users have to get their content; they then have to watch the ads placed together with the content they want to get.
Essentially, the advertisers keep putting up more ads. In contrast, we have a window used for communication between people. When it's not used for communication, the users can view advertising. It's very permissible as the users have to click to see the page of an ad, click to see the next page, and so forth.
For this, the users are rewarded, and we believe that the advertisers who will place advertising get the impact because users are willing to see the ads. And that's a big difference with traditional digital advertising, which is not permissive; it just comes, and it rolls.
Logo of https://decentralized-web.tech/
MP: The viewers have had the power to say,' do I want to see this?' It's an excellent thing because I don't have much power as a customer right now. What's your story behind your decentralized web project? How did you get started? Was it something you've been thinking about before the pandemic or just kind of fell into it?
PA: Well, I had some bits and pieces done for previous projects. For example, many years ago, I thought of online communication, but it didn't form into a project. With this decentralized web project, I started by putting together some pieces of previous projects I have been doing; one work was the communication part.
In 2017, it was the beginning of the cryptocurrency boom. I got interested in blockchains and cryptocurrency. I had done some work on various projects before the decentralized web. First, it was about automated cryptocurrency trading.
In this previous project, I evaluated different blockchains and what is suitable for us. It was like an evolution, from one blockchain to another, and so on. And currently, we're using an Instance, an independent blockchain item; it is a support and not a central element for our project.
MP: That's awesome. I guess the best things are something that you don't expect to happen but it just unfolds. Do you have any other ideas on how decentralization can change business and marketing for the future? Maybe, besides advertising?
PA: Well, I believe we're at the beginning of the decentralization movement. When we mention decentralization as a label, people understand it's related to crypto with blockchain tech. But blockchain technology is very cumbersome.
It goes a step towards decentralization, but it's not through decentralization. For example, users who like to use blockchain projects have to put something on the blockchain. One user can put something on the blockchain, and the other can read something from the blockchain. This prevents direct communication, it is very indirect communication, and as we know, blockchains keep growing in size. So, it becomes a heavy, heavy burden to handle.
I can't think decentralization is the future and the upcoming technology. It's going to be a post-blockchain technology. I touched a little bit on advertising, but it changes the way we search when we form from decentralized networks and so on and so on.
The centralization has all the power; currently, they're essentially monopolies. Google has online searching. Facebook has the monopoly of social networking, and Twitter has the monopoly of short messaging, broadcasting short messages. Decentralization can break the monopolies of these big companies.
We all know about the events of September 11, the terrorist attacks. These events were used to increase government surveillance. There are authoritarian countries like China and Russia - they say openly that they do government surveillance on their citizens, but democratic countries do this as well.
Decentralization has the power of reducing or eliminating this government surveillance, and people will have their privacy as well. But they don't publicize it. It's because there are some leaks about surveillance from security-related people , for us to understand what's going on.
MP: This is incredible; it gives power back to the people rather than just the hands of the few. What's your future vision for your decentralized project and other projects like that? Where do you think they're headed in the future?
PA: We are one of the few projects working specifically on decentralization. Recently, I wrote an article comparing our way of implementing decentralization with the DFINITY project. Our vision for our task is to make a more minimalistic type of decentralized communication system.
They're very well funded, and they did significant funds raising, listing their coin on Coinbase cryptocurrency exchange, showing that they're very significant. In comparing both projects, my point of the article is that our implementation seems essential and minimal.
Our vision for the project is we hope we're one of the pioneers of this new field in a minimalistic way. For example, to have a digital identity, we will require just an email and the IP. With the other project it requires a fingerprint submitted to a mobile device and further it goes to their blockchain and so on...
There's also the current talk of building a Metaverse. But the current understanding of Metaverse is that it's an artificial environment, a virtual environment. We want to connect decentralization with Metaverse. But we do have the connection between the physical and virtual world as well.
Website homepage of https://decentralized-web.tech/
MP: That's awesome; it seems like we're just on at the beginning of all these tremendous changes.
My next question is, what other industries do you think will be transformed by decentralized web?
PA: Well, we cannot currently foresee what will happen in the future.
But currently, there is a very big boom with these so-called NFTs. Essentially, an NFT is a label held at a crypto token address attached to an item. Most often, it's a digital image, but it can also be an audio recording, not only a digital but also a physical item.
I think decentralization will help with offering this type of digital items, and then it's going to help the creators monetize one day on what they create.
MP: That's excellent. So basically, for creators' the sky's the limit. Have you had to pivot your business in any way yet? Or have you just continued with your initial idea, not having to change anything?
PA: Well, we've tried to build an online platform, and currently, we are looking to gain users for our platform. In general, users are welcome to download and become part of the platform in this way. There are also benefits for them to get tokens for their participation.
To gain some revenue for the platform, I think we can pivot to create an NFT marketplace. So, generating revenue right away from the building is not easy; like many other projects, they have a community. But this community is involved just like holding a token or a coin on the project. We like more hands-on involvement where people have to download and use software to do communication and view advertising, get rewards, and so on.
MP: It's much more interactive than just speculation holding and then speculating for a while.
That's awesome; how do you feel blockchain tech fits into decentralization?
PA: If I compare our project with so-called classic blockchain or crypto projects, these types of projects revolve around a specific blockchain. For example, the so-called DeFi area revolves around Ethereum. Blockchains of different kinds of projects evolve around their blockchains.
In our project, as we mentioned, we went through an evolution of selecting from the blockchain. This blockchain is going to play only a supporting element in the project. The purpose of our use of this blockchain is to record what each user is holding.
The user communication and running nodes/bridges, or other types of participation is outside of the blockchain. In lots of different projects everything that happens in the project, it has to go through the blockchain. This doesn't help much for communication, but as I said, as the blockchains grow in size, it becomes a burden to handle.
MP: Yes, blockchains do become very, very cumbersome because they get too, too big. That's interesting, though. My last question is, what's the future of blockchain tech and cryptocurrencies? What do you think will happen in the next five or ten years?
PA: Well, my vision and my point of view are healthy and unhealthy areas in blockchain technology and crypto. I can put in the healthy regions like the NFT s and security tokens because they relate to tangible things - for ex. digital images, or other digital or physical items. In the case of security tokens, this may be equity or a piece of real estate building, or something like this.
I can put unhealthy areas like decentralized finance tokens, many coins, and even Bitcoin. I think these virtual items are driven by speculation, and they're not covered with tangible things. Their price is based on the trading and what people are willing to pay for it.
I think this future connects to tangible items versus purely virtual items. Most of the flows in the cryptocurrency markets, they're from fiat/paper currency into the cryptocurrency. If a portion of this flow reverses back - people who want to cash back from crypto to fiat, then things that are virtual and non-tangible will crash. This includes many coins, DeFi, and even Bitcoin itself.
MP: I agree with that. It's a bit scary with Bitcoin because it's all, as you said, speculative. Thank you so much, Paul, for taking the time to talk with me about your exciting project and the future of decentralization.
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