Web2 protocols & software library examples

Listing out example Web2 protocols and software libraries to consider when thinking about future Web3 ecosystem protocols and software libraries

Web3 ecosystems could develop a number of new protocols and software libraries that donโ€™t require a token. These projects could be gradually improved and maintained over time. Listing some example Web2 protocols and software libraries can helps to provide some evidence that utility and governance based tokens might not be necessary for a large number of projects in Web3 ecosystems.

Network protocol examples

Software library examples

Advantages

  • Faster integration - Users of these protocols and software libraries can adopt them immediately and integrate them into their own solutions helping to speed up their own development efforts.

  • Modifiable - Projects using these protocols and software libraries can take and modify the code to help with addressing any of their own specific use cases.

  • Self determined upgrades - Users will self determine when they want to upgrade from one version to another. If they disagree with a certain change or donโ€™t want to allocate the effort to making an upgrade they could remain on the same version.

  • Predictable - Each version of these protocols and software libraries will usually come with a change log of what has changed since the last version. Documentation is also often available that outlines how the software works and how it can be used.

  • No required governance participation - Anyone using these protocols and software does not need to be involved with how they are developed or be worried about some governance decision suddenly affecting their own usage of the software. Users can let the contributors involved in improving those protocols and libraries handle what changes should be made based on community feedback. Contributors using this software would decide when to adopt any new releases. Teams looking to maximise their execution efficiency could often prefer to not be engaged in the oversight and governance of existing open source projects and instead prefer for that responsibility to be delegated to other contributors.

  • No need to purchase a token - Anyone using these protocols or software can express their preferences and opinions in the forums, code repositories and other available communication channels about what could be improved or what opportunities might exist. No token needs to be purchased for them to participate and have some form of influence over the direction of these protocols and software libraries.

Drawbacks

  • Fundraising to pay for contribution efforts - These protocols and software libraries can be highly complex and require highly specialised professionals to help with maintaining and improving them over time. Funding can often be problematic for some projects due to the fact that the protocols and software libraries themselves are open source and free to use meaning they are not a revenue generating business. Many of these projects are reliant on large sponsors, often from corporations but also from governments and individuals.

  • Excessive sponsor influences - The larger sponsors to these protocols and software libraries can more easily have a larger amount of influence on the development direction of these solutions due to their financial involvement. Projects can benefit from having higher amounts of sponsorship diversity to better protect and represent the interests of the entire user base of these protocols and software libraries.

Key takeaways

  • Tokens are often not necessary - Tokens could introduce more complexities for people to use and integrate these existing protocols and software projects. If every protocol and software project added their own token the users of these solutions would then need to be concerned about the price of those tokens and how it impacts how they can use the solutions available and also be concerned with how token governance could impact their ongoing usage of these solutions. Utility tokens in some projects could end up introducing malicious actor complexity due to the risks that a small group of actors manages to get hold of a large amount of tokens to maliciously impact the usage or direction of a protocol, application or software library.

  • Opportunity for addressing funding issues - An opportunity for Web3 ecosystems is their ability to provide ongoing financial support for building and sustaining open source protocols and software libraries. These emerging Web3 ecosystems massively benefit from having a robust and thriving open source ecosystem that their entire user base can use in their own projects. Increasing the availability of network treasury funding to build and maintain open source protocols and libraries can help with achieving this outcome.

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