Translated by elcreto & LC
Xangle Visits KBW ④ Xangle ADOPTION 2022
The last piece of the “Xangle Visits KBW 2022” series is ADOPTION 2022 conference hosted by Xangle.
ADOPTION 2022 took a slightly different direction than the previously held KBW events. While KBW events mainly focused on blockchain projects, the ADOPTION conference centered on the traditional Web 2.0 companies. The main sessions primarily discussed why Web 2.0 companies should adopt blockchain and crypto, factors to evaluate when using blockchain technology, and ways to integrate blockchain into services. During the conference, Xangle held private sessions bringing together professionals from different industries to discuss business opportunities. The private sessions provided valuable insights on ways to adopt blockchain technology to further develop the business. In this article, we would like to share the energy and enthusiasm that surrounded the ADOPTION conference.
Why is Nexon venturing into WEB 3.0 through MapleStory?
A) To make the already successful game more sustainable.
Nexon COO Dae-Hyun Kang took the stage as the speaker of the first session of ADOPTION 2022, introducing Nexon as a “company that has made unsustainable games sustainable.” Nexon is the no. 1 game developer in Korea with expertise in creating sustainable games and has been heavily investing capital and talents in developing new games as well as in upgrading existing game services. MapleStory is a good example of Nexon’s effort in making the already successful games more sustainable. The world of MapleStory boasts a global player community and network accumulated over 20 years.
Recently, Nexon has unveiled plans to venture into Web 3.0 with the planned development of the MapleStory metaverse. Nexon decided to join the blockchain race because the company believes the various elements that make up Web 3.0 can be leveraged to bring about more sustainable games that Nexon has been pursuing. If so, should other companies start incorporating Web 3.0 like Nexon? The sessions prepared by Xangle and Bain & Company brought some clues to this question.
Why should companies adopt Web 3.0?
A) The downside risk of not incorporating Web 3.0 is much higher.
Xangle and Bain & Company viewed Web 3.0 as a big trend comparable to Web 2.0 innovation led by mobile and social media in the past. While the internet and mobile services are great innovations that transcend space and time, Web 3.0 is defined by open-source technology that utilizes blockchain technology to be trustless and permissionless. In other words, operators that utilize blockchain technology are not only free from restrictions on space and time but also can design the business more freely instead of relying on trusted third parties.
In a new iteration of the internet, Web 3.0, the ways services are planned and operated are likely to change. In contrast to traditional centralized platforms, Web 3.0 empowers users to govern the ecosystem alongside the operators after the initial service build. In this case, consumers may be more likely to choose Web 3.0 platforms where values are distributed to ecosystem participants rather than centrally-controlled platforms. (See figure below)
ADOPTION 2022 also held a discussion session with speakers and expert panels from Innocean, SK planet, and LG CNS to share their Web 3.0 mission. Although they are in different industries, all three companies said that they entered the Web 3.0 space with a common purpose of building communities. These companies are working on building communities through Web 3.0 to capture the voices of their customers, incentivize participation, and distribute ownership. By doing so, companies can reflect the needs of the current generation, who are constantly seeking compensation for all their actions, in the services they provide.
On the other hand, the panels all agreed that persuading stakeholders with short-term views, uncertain regulatory environment, and slow adoption rate of users are the major challenges in adopting Web 3.0. Moreover, if hardware-based companies like Hyundai Motor Company (INNOCEAN) enter Web 3.0, they would need to work on ways to deliver the same level of user experience between Web 3.0 users and brick-and-mortar customers (how to differentiate the utility of vehicle owners and NFT holders).
If the tasks are clearly out there, then why Web 3.0 at all? Most probably it is because the downside risk of not being prepared for Web 3.0 outweighs the risk of implementing Web 3.0. We have witnessed the demise of opportunities that had slipped away from those who overlooked the power of the mobile technology—which gets us to think, what if Web 3.0 turns out to be a revolution on par with mobile devices? And if this is the case, how best to approach it?
What are the key approaches to the Web 3.0 Adoption?
A) Sustainable business should be the focus.
Given the corporate structure of most companies, the Web 3.0 services discussed above may not be easily achieved. Xangle co-founder Junwoo Kim stressed that the Web 3.0 adoption should be approached with prudence, including clear standards and a phased approach. A hurried approach focused only on the “tool” and a goal set on fragmented outcomes, such as NFT minting and token sale, may disrupt the sustainability of the service. This is to say that the companies first need to clarify the business outcomes they wish to achieve with the “tool” instead of focusing on the “tool” itself. Transitioning from a Web 1.0/2.0 company to a Web 3.0 company does not happen overnight. Decentralizing a centralized business structure is even more so. Hence, Web 3.0 requires a phased approach that is geared towards synergy with the existing business and a sustainable business model.
In this very context, Nexon’s approach to Web 3.0 has many implications. Nexon set a clear goal of “making games sustainable” and announced its plan to adopt Web 3.0 as a tool to achieve the goal. From there, it went on to define i) a homegrown game, ii) an ecosystem that arises from the game, and iii) decentralization of IPs as their top priorities. The move marks a departure from its previous attempts to control certain areas and implies the new direction of its plans ahead, which is to provide support to grow the ecosystem. Nexon is expected to build an ecosystem of creators through decentralization and create an NFT-based universe of MapleStory. In this process, Nexon’s abundance of IPs and 20+ years of ecosystem management experience will be greatly instrumental in entering Web 3.0.
Already, major Web 3.0 players have been aware of the challenges facing traditional companies and tried to provide them with the right services. At Xangle ADOPTION, leading layer 1 and 2 projects, such as Polygon, Solana, Avalanche, BNB Chain, and NEAR, promoted their enterprise services and looked for partnerships. All the five projects brought up Ethereum’s scalability issue and highlighted their i) fast-processing speed, ii) low fees, and iii) localization. Some of them actually saw tangible results during the duration of the Korea Blockchain Week 2022. Most notable deals include Solana-Krafton, Solana-Naver Zepto, and Polygon-Neowiz partnerships. Apparently, the deals are illustrative of those projects’ support for facilitating the Web 3.0 adoption process of the South Korean companies.
There is no doubt that the road ahead of blockchain services is never short of challenges:
1) High Entry Barrier: Unlike traditional services where users could play the games simply by signing in, blockchain services will require new users to create a wallet and use a bridge and DEX, complicating the access to the service.
2) Low Scalability: As James Ferguson, the CEO of Immutable, said, when even a blockchain with a processing speed of 10,000 TPS finds it difficult to run one single mid-size Web 2.0 game, it is only natural blockchain networks are yet unable to onboard large-scale services with multi-million users.
Promising, though, is the fact that both Web 2.0 and 3.0 companies are well aware of the challenges and taking a step-by-step approach to the matters—just like Mythical Games trying to dramatically compress the data using Polystream’s technology. Also particularly noteworthy is the fast growing interest in Web 3.0 among the general public, who seem increasingly willing to embrace subsequent changes. This surely is another reason that points to a brighter outlook for blockchain services over the long haul.
Looking Back at Xangle’s First Conference ADOPTION 2022
Three years ago, Xangle held a small seminar titled “Not For Sale” with the theme of blockchains and enterprises. The seminar, though, was not actually translated into a meaningful result as it was too premature to incorporate the blockchain technology into existing services. Now, three years on at Xangle ADOPTION 2022, the change was palpable. Dozens of projects and hundreds of companies gathered at the conference, evidencing that blockchains and cryptocurrencies have got past the stage of conception and that the companies are now more focused on the “ADOPTION services,” which refer to services widely adopted by the general public. This is why Xangle co-founder Junwoo Kim saw this crypto winter as a winter break rather than a downright bear market. He defined this winter break as a run-up to spring. We would like to wrap up the Xangle Visits KBW series by wishing that Xangle ADOPTION 2022 served as an opportunity for the companies to start connecting the dots that lead to achieving milestones in this era of great changes and also as the beginning of a longer-term journey to make Web 3.0 readily available for a broader population of consumers.
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