Have you ever manually chosen between Azure and AWS when browsing X — or chosen a payment processor to forward Apple Pay online transactions to? Do you check AliExpress or Amazon's SSL certificate to make your shopping more secure?
Great technology is invisible. Steve Jobs was right years ago when he called for prioritizing the intersection between technology and the humanities. However, when it comes to blockchain, it's quite the opposite.
Lost in the wreckage of wallets, exchanges, bridges, tokens and smart contracts, Web3 seems to be wandering in circles, retracing its steps. In its attempt to innovate, it misses the opportunity to address the basic needs of the consumer experience: ease of use, reliability, intuition, and seamlessness.
Technologically, blockchain technology has advanced enough; It's time to build a proper application layer.
Poor user experience causing low data retention rate
According to a recent report by Sequoia Capital, the average one-month retention rate for existing tech apps is 63%. Ethereum dApps barely exceed 16%.
For those who care about user experience research, this is not surprising. Blockchain users are consistently less satisfied than their off-chain counterparts, with only a third of dapp activities being completed in less than ten minutes and negative reviews making up the majority for Web3 apps on the App Store. Nearly 90% of consumers abandon mobile apps due to poor user experience. Yes, a small portion of your audience may prioritize decentralization and Web3 ethics, but overall, speed, ease, affordability, straightforwardness, and intuitive interfaces come first.
A large number of layer 2 solutions such as optimistic aggregations or zero-knowledge proofs attempt to address scalability concerns, extracting value from transaction demand, volatility of transaction costs, and slow execution times. This is an important advance regarding the technical pathology of blockchain. However, the implementation of Layer 2 blockchains does not completely replace other elements associated with the application layer. User-centric decentralized applications are few and far between, representing a severe blow to the ecosystem.
While blockchain enthusiasts may be persuaded that the ends justify the means, the average user without a technical background will likely ignore the technology if they have difficulty getting to grips with the interface. Otherwise centralized exchanges would not have dominated the industry – why open a custodial wallet if you have cold ledgers, private keys, peer-to-peer or decentralized alternatives that have more sovereignty and security, especially after FTX?
However, centralized exchanges currently account for 91.4% of spot trading volume and about 98%, including derivatives, meaning that the average consumer values ease of use more than security.
Add to this the steep learning curve, the need for intuitive and comprehensive primers, and the various possible failure scenarios, and it becomes clear where skepticism toward blockchain stems from. For example, Robinhood, one of the most popular trading apps in the US, does not support USDT but allows opening USDC wallets and sending Tether to accounts owned by the exchange, which is not available to regular users.
However, a less skilled customer will only be able to tell the difference between stablecoins on page 3 of the FAQ – after their funds have been irretrievably burned. While developers may advance a new scientific frontier in zero-knowledge proof, this is unlikely to convince a user to continue engaging with cryptocurrencies.
Building from the ground up: a user-driven blueprint
The industry craves a slow, evolutionary approach to revolutionary transformations. We need to vertically separate or focus developers on the blockchain application layer. Providing a better solution to a smaller problem is a healthier approach than providing a weaker solution to a larger problem.
For example, a modular approach to system design can promote the independent development of blockchain components without compromising the stability of the overall ecosystem. Responsive validity proof (a combination of optimistic sets and ZK validity proofs) reduces cost barriers. It increases time efficiency, while the decentralized blockchain network ensures fairness and scalability in transaction execution. All of these consumer-targeted technologies already exist, however, they are only being implemented by a few projects.
Web3 has long isolated itself in solving problems within a narrow audience of cryptocurrency enthusiasts; Now is the time to embrace a different vision and support visionaries and innovators to apply it to real-life problems rather than self-imposed financial challenges. Blockchain technology is a powerful tool – we just need to make it more accessible.
