Nothing in this article constitutes professional and/or financial advice.

The post To Stake or Not to Stake? first appeared on Black Women Blockchain Council.

“To create a new class of decentralized apps and protocols that put individuals at the center, we must empower them with self-owned identity and restore control over their data.”

Dorsey has raised the alarm for some time that Web3 isn’t delivering on its promise of decentralization. Per Dorsey, “[Web3’s] ultimately a centralized entity with a different label.” His answer to that is Web5: An Extra Decentralized Web Platform, built on Bitcoin. The focus is on securing personal data to put the user in control of their own data and identity. “The web democratized the exchange of information, but it’s missing a key layer: identity. We struggle to secure personal data with hundreds of accounts and passwords we can’t remember. On the web today, identity and personal data have become the property of third parties,” per TBD. “Web5 brings decentralized identity and data storage to your applications. It lets devs focus on creating delightful user experiences, while returning ownership of data and identity to individuals”.

What’s TBD’s thesis? “In the current web model, people are users who do not own their data or identity. They are given accounts by companies and their data is held captive in app silos.” TBD asserts that “to create a new class of decentralized apps and protocols that put individuals at the center, we must empower them with self-owned identity and restore control over their data.” Web5 is a Decentralized Web Platform that enables developers to leverage its three pillars to write Decentralized Web Apps, returning ownership and control over identity and data to individuals.

The Pillars of Web5

• Decentralized Identifiers:
  4 Self-owned identifiers that enable decentralized identity authentication and routing.
• Verifiable Credentials:
  Data formats and models for cryptographic presentation and verification of claims.
• Decentralized Web Nodes:
  Data storage and message relay nodes that serve as the foundation for decentralized apps and protocols.

Here’s an example of one use case: Alice hates having to recreate her playlists and music profile repeatedly in different music apps. What’s the solution? Instead of storing her data across multiple apps, she can store it in her own DWN (Digital Web Node). This way she can give any music app access to her settings and preferences, enabling her to take her customized music experience wherever she wants – because she owns her data.

About TBD

“TBD’s mission is to make the decentralized financial world accessible – for everyone”. Their projects are “open source and, where appropriate, built on open standards.” Their website lists these foundational pillars:

• Inclusivity
  Anyone with the capacity to contribute can. We are proactive in welcoming a diverse contributor base for our code, documentation, developer relations, education, and communication efforts. Bad actors will be met with a published governance model and enforced code of conduct. You deserve representation in our development communities, and we promote
  varied perspectives and respectful debate.
  • Transparency
  Decision-making is open by default, with rare exceptions made for security, compliance, personnel, or other sensitive issues. Projects under TBD’s stewardship will conduct design, roadmap, issues, bugs, and code reviews in public. This is critical for accountability and to promote the inclusive environment necessary for project success.
  • Clarity
  Projects need well-defined scope to succeed. They also need accessible, comprehensive documentation, a stellar Getting Started experience, and well-defined expectations. TBD fosters an environment built for contribution without personal intervention. Newcomers should be able to follow the project status on their own without additional explanation.

On a recent Twitter Spaces where TBD was interviewed about the project, another program, Solid, was mentioned; it has a similar goal with a slightly different approach.

Solid

Solid is a specification that lets people store their data securely in decentralized data stores called Pods. Pods are like secure personal web servers for your data.

• Any kind of information can be stored in a Solid Pod.
• You control access to the data in your Pod. You decide what data to share and with whom (be it individuals, organizations, and/or applications). Furthermore, you can revoke access at any time.
• To store and access data in your Pod, applications use standard, open, and interoperable data formats and protocols.

Solid Servers and Pods

A Solid Server hosts one or more Solid Pods. Pods are where you store your data:

• Each Pod is fully controlled by the Pod owner (i.e., you).
• Each Pod’s data and access rules are fully distinct from those of other Pods.

Sovereignty over one’s own data and digital identity is clearly at hand, but a problem still to be solved is what to do if a user loses or breaks their phone, thus losing access to all their data. “How is identity theft and losing access to your personal account dealt with? It’s especially scary when all of your data is in one place.” “Moezilla” from the TBD team responded “It’s a problem for us to solve, and everyone working towards decentralized apps and self-custodial wallets is working on key management and key recovery in a self-custodial manner. How do we make it so you don’t have to be a security expert or never lose your phone (which is unrealistic)? Key management is one problem that tech hasn’t solved yet but many are working on it, including us. It’s a mixture of technical and user experience that will have to come together.” Twitter Spaces Host Angie Jones, who is also Block’s VP of Developer Relations, chimed in saying “This is a human problem that technology alone can’t solve. We need to look at this through a different lens…people are going to lose their keys, and [key management] is a problem across the space…this has to be solved”.

Author: Noi

The post Who’s ready for Web5? Jack Dorsey and TBD are, and they aren’t alone. first appeared on Black Women Blockchain Council.

“The consolidation of enough market influence in the hands of a few; otherwise known as “Whale” activity is not sustainable in a decentralized ecosystem. ”

These CeFi platforms use custodial wallets while providing high yield return on the staked assets and in turn, lend out those assets to institutions that pay higher rates. It was exciting for users to get as high as 90% APY on savings, but reality set in when these platforms halted withdrawals during the crash.

To prevent further liquidity issues, platforms like Celsius Network had to halt withdrawals, Finblox & Voyager lowered their withdrawals limit, while Babel Finance temporarily halted withdrawals. Blockfi would have suffered major liquidity pressures if not for FTX coming to bail them out with a $250 million credit line.

On July 13, 2022, Celsius, which attracted 1.7 million customers and $11.8 billion in deposits as of June, filed bankruptcy in New York. According to Reuters, Celsius “estimated its assets and liabilities as between $1 billion to $10 billion, with more than 100,000 creditors”. Previously on July 6, Voyager filed for bankruptcy after issuing a notice of default to the Singapore-based crypto hedge fund 3 Arrow Capital.

An article written in Cointelegraph highlights that some believe that most of the risks could have been mitigated if these platforms had better risk management processes in place. The article quotes three Coinbase executives’ take on the issue, stating that the whole crash was “foreseeable and actually credit specific, not crypto specific in nature. Many of these firms were overleveraged with short term liabilities mismatched against longer duration illiquid assets. We believe these market participants were caught up in the frenzy of a crypto bull market and forgot the basics of risk management.”

Overall there are lessons to be learned from this; we need more decentralized platforms.

One of the major advantages of using decentralized platforms is the non-custodial wallet feature; where users get to be in full control of their funds without any fear of restrictions of their assets. With these events, the term “Not your keys, not your crypto” has rung louder because interacting with platforms that take hold of your keys gives the platform control over your funds, which could be devastating. You can wake up one morning and not be able to access your funds because you’ve been restricted from making withdrawals.

Another advantage of decentralized platforms is transparency. Open and auditable transactions enable users to see what’s going on behind the scenes and where their assets are deployed. The bear market allowed users to be aware that CeFi lending platforms were taking larger risks lending out users’ funds to parties who couldn’t pay back.

The inability to withdraw at will from these lending platforms and the crypto market crash devastated many. Decentralized platforms give you control of your private keys, funds, and knowledge of where your assets are deployed. These are platforms we should all adopt.

The consolidation of enough market influence in the hands of a few; otherwise known as “Whale” activity is not sustainable in a decentralized ecosystem.

True decentralization is achievable when no singular person or group has total control.

Author: Becky

The post The Need For The Adoption Of A More Decentralized Space first appeared on Black Women Blockchain Council.