The Web 3.0 economy has been growing at a significant pace over the past two years, with Decentralized Finance (DeFi) and Non-fungible tokens (NFTs) taking the centre stage in the crypto market. Touted as the next iteration of digital ecosystems, Web 3.0 has the potential of growing into a trillion-dollar market according to projections by JP Morgan, amongst other big players in the traditional finance spac
While the potential for growth is enormous, there is a big challenge when it comes to interoperability between the existing blockchain networks. Most of these emerging ecosystems limit users to one network, denying them a lot of untapped opportunities that would have been fundamental in increasing their wealth. Well, that does not have to be the case anymore; the rise of interoperable blockchain networks is gradually changing the game.
Given the ongoing developments, we sought for an interview with Ken Timsit, the Managing Director of Cronos chain (a pioneer blockchain network that interoperates with both Ethereum and Cosmos ecosystems). Here is what the long-term crypto market expert had to share about the value proposition of interoperability and prospects of the Web 3.0 market.
Hi Ken, thank you for taking time to have this interview. I understand that Cronos Chain is an open-source and interoperable blockchain network, what was the inspiration behind this type of infrastructure?
We are moving towards a multi chain world, which is apparent when you look at the growing market share of layer 1 and layer 2 networks. Cronos chain is a top 10 public network that was created to deliver this multi-chain promise to the users of our strategic partners such as Crypto.com, Crypto.org, and the 250+ other applications and services which have chosen to integrate with Cronos.
One one hand, users and developers can enjoy the familiar experience of an Ethereum-compatible chain with all their favorite wallets and developer tools. One the other hand, Cronos is also able to interoperate with a wide range of other EVM-compatible, Cosmos and other blockchain networks through the Inter-Blockchain Communication protocol (IBC) and other bridges.
How long has the Cronos network been operational? Also, what is the underlying consensus mechanism and tokenomics?
The Cronos mainnet has been live since November 2021 and has been running non-stop since. The network’s consensus mechanism is based on Tendermint technology as provided by the Cosmos SDK. It is a proof of authority (POA) consensus in the sense that each new validator node must be approved by the network, and then it has a voting power which is proportional to their stake in the network. The network is decentralized with 27 validators currently, and plans for more.
Given the potential of the Web 3.0 economy, what do you think is needed to unlock the next growth phase in DeFi, NFT and Metaverse development?
The first priority is to further improve the user and developer experience. We have made huge strides during the last 5 years but Web3 is so much harder to build compared with Web2 because we are dealing with transfer of value and the expectation is zero defect all the time, so mainstream Web3 adoption will take some time and we are still in the early days. We need multi-chain wallets that abstract the complexity of underlying networks, such as the Crypto.com DeFi Wallet. We need reporting tools that make it easy for end-users to monitor their assets and calculate their taxes. We need DeFi protocols that can re-allocate assets dynamically according to the risk / reward profiles chosen by end-users. We need better discovery tools to sift through the thousands of new NFTs created every day. And we need more creative, exciting, entertaining game universes for all user demographics,
Still on the growth factors, can you shed some light on the recently launched $100 million Cronos Accelerator program?
The Cronos Accelerator Program aims to attract world-class founders who share our vision regarding the need for innovation that is required to unlock the next growth phase in DeFi and GameFi. The start-ups who access the accelerator program will be able to tap into the more than 50 million users who are part of the Cronos ecosystem. In return, we expect that they will come with great ideas on how to build better and simpler user experiences for these mainstream users.
The accelerator program will on-board around 10 start-ups per cohort. Each cohort will run for around 10 weeks. They will be paired with mentors and will be invited to attend expert talks in order to fine tune their product / market fit. At the end of the program, the start-ups are invited to pitch the program’s partners.
What will be the criteria for selecting qualified startups and how often will the accelerator program be held?
The Cronos Accelerator Program will run 3 to 4 times per year. Start-up selection will focus on 3 sectors: consumer DeFi, Gaming, and underlying infrastructure. We expect that candidates are able to commit to work on the project full time, and that they have not yet raised institutional capital.
Other selection criteria include: the innovative nature of the project when it comes to creating Web3 products for mainstream users; the track record of the founders in building tech products; and the team’s commitment to best development and security practices.
Besides the Cronos Lab Ecosystem Fund, are there any other Crypto VCs and Investors who have committed to the program? If so, what fundamental value will they add to the selected startups?
Several VCs and investors have joined the program as partners and are planning to attend the demo day: Crypto.com Capital, Mechanism Capital, Spartan Labs, IOSG Ventures, OKX Blockdream Ventures, AP Capital, Altcoin Buzz, Dorahacks. More partners will be announced in due course. These partners have a tremendous track record in terms of understanding the latest market trends and opportunities. They have been through several market cycles and can provide invaluable advice to founders when it comes to how they should think about product / market fit, tokenomics and scaling in the current soft market.
You mentioned earlier that Cronos has been live since November 2021, how many DApps have launched on the ecosystem and what new developments can the larger Web 3.0 community expect in the near future?
Cronos chain is currently home to more than 250 applications, primarily in the consumer DeFi and gaming sector. This is amazing and yet, we are barely scratching the surface in terms of available applications relative to the size of the Cronos ecosystem community and its addressable users of more than 50 million users. Today, I think that Cronos is by far the most attractive chain for application founders who are looking to achieve visibility and traction with a large user base.
Lastly, what is your take on the transitioning from Web 2.0 to Web 3.0, will the latter completely displace the former or will there be an integration?
Web3 makes it possible to create systems to store and transfer value with a small fraction of the resources required in the Web2 paradigm. A handful of developers can take advantage of the native security of blockchain technology to create protocols that store and manage billions of dollars in value. On the other hand, blockchain technology is currently not ideal for large data storage and retrieval, or for vivid and snappy virtual reality or game experiences. We expect Web3 applications to combine blockchain technology with other existing technologies in order to deliver a great user experience.
Conclusion
As we can see from the interview, Web 3.0 is certainly defining the future of the internet and financial markets. However, this vision can only be actualized through the commitment of involved stakeholders; developers, investors and regulators. In the near future, it is likely that we will have more people participating in the Web 3.0 economy. More importantly, the debut of interoperability solutions and resource inflow will be a big boost to the growth of the industry.
