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  • Writer's pictureDecasonic

Web3 Investor Day 2023: Proof of Adoption

Updated: Jan 16

Fresh Perspectives into the Evolving Web3 Landscape

-- Danny Pantuso, Venture Investor, Decasonic

For the 2nd year, the team at Decasonic hosted our annual Web3 Investor Day, an invite-only gathering of our industry leaders to discuss the current and future of Web3 investments and innovations. This year, our themes centered on Fresh Perspectives, Proof of Innovation and the Evolving Landscape in Web3.

In contrast to 2022, markets have normalized in crypto. But throughout the day, we discussed how bear markets make healthier ecosystems, how founders can finally get back to building with patience and how a get-rich-quick mindset has been replaced by a ‘prove-it’ market. In light of these macro changes, we’ve themed this year's conference around the Proof of Adoption and backed it up with panels that showcase the sprouts of crypto thawing. Continuing to iterate on previous successes, this year’s conference beamed with over 300 attendees, 100 investors, and 22 different startups demoing.

From the conference's eight thought-provoking panels, ten key takeaways emerged. Let’s take a closer look at what’s changed from last year's Web3 Investor Day and what it means for the next one.

1. Institutional Interest Lends Legitimacy

The first standout takeaway from Web3 Investor Day was that the Web3 landscape is garnering interest from mainstream asset allocators such as pension funds, university endowments, and Fortune 500 companies. The "Institutional Interest" panel highlighted the significance of this development, as it further legitimizes the sector and instills confidence in the minds of investors. It’s clear that the market is still maturing, but a growing number of investors are eager to back web3 projects.

As the proof of innovation becomes more apparent, institutional investors display greater interest in Web3 projects. The participation of established institutions in Web3 investment signals the recognition of its transformative potential, and will likely play a crucial role in driving late-stage price discovery and the sector's overall maturation. The density of ideas and capital is fueling a healthier trajectory of innovation, attracting long-term capital even in bear markets.

2. The Regulatory Landscape Still Evolves The regulatory landscape is evolving. Governments around the world are still trying to figure out how to regulate and or embrace web3. While there is a growing consensus that regulation should foster innovation, finding the right balance remains a challenge. Web3's immense promise as a disruptive technology is met with challenges of scalability and usability, alongside the need to establish a clear and supportive regulatory framework.

However, this period of regulatory turbulence also presents an opportunity for the industry to mature and for innovators to proactively address the challenges ahead. Mike Frisch from leading Chicago Crypto law firm CrokeFairchild took the stage to note that despite the regulatory uncertainties, the Web3 community has demonstrated its resilience and commitment to driving positive change.

Collaboration between industry participants, regulators, and policymakers is vital to create a conducive environment for Web3's growth. Founders and investors who prioritize compliance and work towards building sustainable, impact-driven projects will be better positioned to weather regulatory storms and establish themselves as leaders in the space.

Looking ahead, it is crucial for the Web3 community to engage constructively with regulatory authorities, providing insights and expertise to shape regulations that encourage responsible innovation and safeguard the interests of all stakeholders. Rather than being deterred by regulatory uncertainties, these challenges should serve as catalysts for collective efforts to develop a robust and adaptive self-regulatory framework that supports the long-term growth and potential of Web3.

3. Use Cases Expand to Real World Applications

In the early days of web3, many projects were focused on building theoretical applications. More recently, venture capital has flowed into infrastructural projects with the thinking being that in uncertain times it’s best to invest in picks and shovels before the next gold rush. However, the opportunity today is now shifting to building real-world applications that are built on top of real-world assets. There are a number of reasons for this shift in focus. Primarily, as the infrastructural improvements have made tokenization- the process of bringing something on-chain - easier, more and better real-world use cases have become possible. Anything can be on-chain: data, information, assets. Once an asset has been tokenized, it can be accessed, bought, sold, or transacted on a blockchain network. It follows that the most profitable real-world assets to be brought on-chain are the assets that are already the most valuable, and that benefit most from better transactions.

4. Fundraising in Web3 is Still a Challenge, but It's Getting Easier

In light of the regulatory actions, the rise of AI, and general market adjustments to higher interest rates, much has changed for founders raising money since our inaugural Web3 Investor Day of 2022. Whereas many deals were oversubscribed and hyper-competitive, this year has had the luxury of longer diligence cycles and better pricing power. As a result, many founders have understandably found it difficult to raise money and keep up with such a rapidly evolving ecosystem.

The panel on "Fundraising from VCs as a Founder" shed light on the evolving dynamics of fundraising in the Web3 space. Successful founders recognize the importance of aligning their visions with their investors' long-term goals. Raising in a bear market requires more patience and more emphasis on durable use cases. VCs are increasingly prioritizing projects with durable use cases, capital-efficient growth, and positive industry catalysts, signaling a shift towards more sustainable and impact-driven investments.

The "Leadership in Web3" panel explored the idea that leadership in Web3 will not be based on traditional metrics but on the ability to create positive consequences for people in both digital and physical realms. Founders who consider the broader impact of their innovations are more likely to foster mainstream adoption and create lasting change. The power of storytelling combined with lean startup strategies sets the foundation for founders to secure their first check and gain the support necessary to propel their ventures forward.

5. Web3 Enables Interactive Media

Web3 is enabling a new era of interactive media, revolutionizing how users engage with digital content. The ongoing writer’s strike showcases how a more equitable future for writers and creators, in general, is needed (read more). Many point to web3 economics as the fix for the streaming industry payout structure. On the panel “Media and Web3,” panelists discussed how web3 redefines the boundaries of interactive media, where users become active participants rather than passive consumers.

Ownership and control over digital assets, enabled by blockchain technology, empower content creators and users alike, fostering a sense of community and direct involvement in the content creation process. For example, Fan Controlled Football is a fantasy league where every player is an NFT minted and owned by its Fan agent. Feature3, on the other hand, integrates blockchain tracking directly into any video player (including YouTube), enabling users to vote on future content, collect rare durables, and own a piece of the action.

Overall, we’re seeing more and more ways that Web3 offers a more equitable and sustainable way for creators to earn a living and fans to get in the action. Both enable new possibilities for revenue streams for both small creators and mega-stars alike.

6. The Powerful Fusion of Web3 and AI Lead the Innovation of Today

The overnight rise of GPT means that blockchain is now not the only pivotal technology of our time. The convergence of Web3 and Artificial Intelligence (AI) was a captivating topic explored during the "Web3 X AI" panel. Where AI is probabilistic, changing, black box, and built on algorithms that guess at reality, Blockchain is deterministic, permanent, transparent, and is cryptography to record reality. This powerful fusion drives innovation across industries, creating opportunities for autonomous digital organizations and unlocking the potential of next-generation NFT utilities.

As pioneers in this space, innovators in the Demo Den showcased a plethora of AI-driven Web3 applications that have the potential to revolutionize the way we interact with technology. It was clear that these two technologies have the potential to create powerful new applications that will change the way we live and work.

7. Web3 Disrupts Digital Commerce

The "Future of Web3 Commerce" discussion took center stage as panelists explored the transformative potential of Web3 in disrupting the digital commerce landscape. With programmable money, smart contracts, and blockchain technology, Web3 presents unparalleled opportunities to lower costs and reduce friction in digital transactions. The session showcased how incumbents like Shopify are taking bold steps to embrace this transformative technology, signaling the dawn of a new era in digital commerce. Founders who build products with a strong emphasis on inclusivity, civic leadership, and pay-it-forward principles are poised to disrupt traditional commerce models.

8. Apple’s Vision Pro Catalyzes Mixed Reality

Apple’s recent announcement of their XR headset was big news. Apple’s blend of world-class UX and hardware design consistently re-imagines and 10x’s any industry they enter. What could that mean for Augmented and Virtual Reality? The metaverse is a virtual world being built on top of web3. In 2023, the metaverse is growing steadily, with 12% of households in America owning a VR headset already. But Apple’s entrance into Mixed Reality with their new headset is set to be a game changer - one from the old definition of the metaverse to spatial computing. On the panel “Immersive Web3 - Metaverse, NFTs, and Gaming,” we showcased the transformative power of these immersive technologies, which are redefining user experiences and revolutionizing various industries. As the internet infrastructure continues to upgrade, consumer experiences will also change from the current 2D multimedia towards a next-generation 2D/3D immersive space. Different visions of the metaverse are emerging across the spectrum of realism vs virtual, physical vs digital. Crypto will lay the foundations for a self-sovereign financial system, an open creator economy, and a universal digital representation and ownership layer of digital assets via NFTs (non-fungible tokens).

9 Chicago is a Thriving Hub of Innovation

The conference emphasized Chicago as a hub of innovation with its panel on "Innovation in Chicago." The city's vibrant ecosystem and supportive community foster a conducive environment for nurturing disruptive ideas. Unlike tech ecosystems like Silicon Valley and New York, Chicago is uniquely community-oriented, civic-minded and pay-it-forward supportive. Conferences such as Web3 Investor Day bring together the best minds in the industry, driving collaboration and propelling Chicago's position as a center of technological advancement. Our presenting partner World Business Chicago discussed in depth the city’s strategy for sustaining this innovation and setting the standards high for innovating excellence.

10. The Long-Term Vision for Web3 Transforms Value Exchange

Finally, Brian Walls had a phenomenal conclusion in his night-capping session "Where we are going," illuminating the long-term vision for Web3, pointing towards a user-owned, decentralized internet that fundamentally reshapes how we coordinate and exchange value. As the Web3 ecosystem matures, it will require patience and steadfast commitment to these principles. The paradigm shift towards a decentralized future may be gradual, but the impact will be profound and far-reaching.

In conclusion, Web3 Investor Day 2023 was a resounding success, enabling innovation conversations to collide and thrive. It takes a village to create and nurture durable innovation, and events like Web3 Investor Day play a pivotal role in fostering these connections. Presenting partners, such as Bridge Alternatives, Nasdaq, Sterling Bay, and World Business Chicago, exemplified the spirit of collaboration that fuels Web3's progress.

Over the coming weeks, we’ll release in-depth recaps of all the panels, including live video recordings, panel topics and summaries. Head to our LinkedIn profile here to catch the latest release or our website page, where you can see the full overview of speakers, discussion topics, and demos. You can see all our findings and our demoing portfolio companies on our website.


The content of this material is strictly for informational and educational purposes and is not meant to constitute investment advice or a recommendation or solicitation to buy or sell any asset or to make any financial decision. Nothing in these blog posts should be considered legal or tax advice. You should consult with your own professional advisor before making any financial decision. Decasonic offers no warranties on any content in the material posted in these blog posts, including that it is accurate, complete, or correct. The opinions expressed in these posts are those of the authors and do not necessarily reflect the views of Decasonic. Decasonic is not liable for any errors or omissions in the content of this newsletter or for any actions taken based on the information provided herein.


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