The past few years have witnessed significant growth in the creator economy, with more and more people making a living from their art through digital or social media platforms. According to the most recent statistics, the global creator economy is currently valued at around $191.55 billion; projections show it could balloon into a $525 billion ecosystem by 2030.
This next phase of growth will likely be fueled by newer technologies such as Artificial Intelligence (AI) and more advanced Web3 ecosystems like XION which are already being integrated into some aspects of the creator economy. However, while both AI and Web3 are proving to be potential game-changers, one cannot help but notice that AI is way ahead in terms of making a fundamental impact.
To provide some more context, a recent survey by Collectively revealed that 25.5% of content creators use AI tools at least once or twice per week in their workflows. Meanwhile, Web3 is still struggling to get a product market fit (PMF) in the creator economy; Friend.tech, a Web3 social DApp, which made waves at the height of the SocialFi boom is now struggling to hit a mere 10k monthly users.
Why Web3 Isn’t Working for Creators (Yet)
Before diving into some of the key reasons why Web3 is yet to provide a futuristic breakthrough for the creator economy, let’s briefly highlight some of the facets of this nascent technology that could come in handy.
Wallets: Web3 non-custodial wallets are designed in such a way that creators can leverage them to receive borderless payments from anyone across the world who is willing to support their artwork.
Non-fungible tokens (NFTs): This Web3 product niche allows creators to integrate their work with on-chain economies, attaching a unique identity that is digitally secured as well as flexible enough to be sold beyond the conventional physical art auctions.
Tokens: Creators also have an opportunity to use crypto tokens to create their own sustainable ecosystem that feature reward systems for their fans based on the native assets.
The Real Problem: Onboarding Hurdles and User Experience
As much as it all sounds good on paper, the catch-22 here is that Web3 promises to revolutionize the creator economy through its core principles such as decentralized ownership and borderless access; however, as it stands, most protocols and Web3 DApps are leaving out the most important aspect in the adoption and integration journey; a seamless user experience.
Think about an artist who has no technical knowledge whatsoever but would like to convert their physical art into an NFT, how do they go about it? Of course, there are some guides provided by the different protocols or DApps on how to go about the process, but rarely do they break down the technical jargon. As such, a good number of artists or creatives have been forced to outsource NFT developers or simply abandon the whole idea of getting into Web3 altogether.
It is also intriguing to observe that the most basic functions in Web3 also require some level of technical knowledge; a simple NFT mint and transfer for instance would require one to sign and approve multiple smart contract requests. It may sound straightforward but even some crypto natives are yet to interact with DeFi and NFTs on a practical level because of the complexities involved in user interaction, steep learning curves and the burden of private key management.
Maximizing Value Through Abstraction
What if all these complexities in Web3 could be abstracted away?
Today, there are more than 5.56 billion internet users across the world but only a very small fraction understand the inner workings of the HTTP (Hypertext Transfer Protocol) and TCP/IP (Transmission Control Protocol/Internet Protocol) infrastructures. Similarly, Web3 protocols and DApps ought to be as user-friendly as possible such that anyone can tap into the value proposition regardless of their technical knowledge.
While most of the pioneer chains are stuck with complex user journeys, it is promising to witness nascent Web3 ecosystems such as XION putting more emphasis on a seamless user experience. This Layer 1 blockchain recently released a MiCA-compliant whitepaper, making it the first L1 on mainnet to do so. At the core, XION is designed to enable Web3 developers to create more consumer-friendly DApps through a Generalized Chain Abstraction solution.
But how exactly does it work? XION’s Chain Abstraction process involves abstracting away complexities such as account creation and management, signatures, fees and interoperability. It is able to achieve this by embedding critical blockchain functionalities into its core protocol thus eliminating the need for complex third-party solutions.
With such Web3 ecosystems that abstract away the user journey complexities, creators are now in a better position to explore what this promising field has to offer. This type of development will likely mark a paradigm shift in Web3 adoption; gone will be the days when Web3 was a reserve for techies into an era where industries embrace and start using this nascent technology on a regular basis – just as AI has proven its value proposition, and on boarded millions globally owing to the simplicity of using tools like ChatGPT, Dalle and Midjourney.
Conclusion
The creator economy may still have a long way to go in terms of extracting value from Web3 but it is worth noting that one of the biggest crypto breakthroughs was triggered by creatives who took interest in the sector at the height of the NFT boom. While a good number left after their NFTs tanked or found it complex to navigate the ecosystem, there is still a huge untapped opportunity for creators. However, this potential can only be unlocked by making Web3 as seamless as possible to use.
