This article came up on twitter last month. I remember finding it very interesting and taking the time to systematically untangle it. I will try to do a good job of explaining all the problems here.

This article is interesting to analyze regardless.

First; the author is correct across several dimensions. The Ethereum virtual machine is non optimal as a computer (currently). Blockchain is also not a great way to store data (currently). Let’s agree with the author on these points.

However, no one is saying anywhere that Ethereum is meant to replace AWS or that it’s primary purpose is to replace AWS S3. The nomenclature of “world computer” is not currently meant to be understood in the sense of “AWS killer.”

Ethereum was not designed to be a super fast computer to calculate things. It was designed to decentralized money and enable smart contracts.

Right now, Ethereum and crypto primarily replacing money, first and foremost. There are numerous people working on subsequent innovations called “Decentralized Web Services” which WILL have the intent to compete with AWS. So this angle of attack on Ethereum is unjustified.

It makes sense to me that all compute resources are ultimately listed on an open marketplace where people can bid for them. That structure might compete with AWS. I don’t think that is the first thing Ethereum is designed to do, but Ethereum and technologies like it will enable that use case later.

Author goes in to leap to a conclusion which can’t be justified Aka Web3 is all a scam. Wrong. Every problem he identifies is well understood by leading folks and in the process of being solved across multiple dimensions. Just read Vitalik’s blog. Vitalik has talked about solutions for years.

Author just points out a couple known problems in Ethereum that are being solved actively and goes “see, it’s all a scam,” not a good angle.

So intent of author feels disingenuous. Or lazy?

Author also points out that Web3 relies extensively on existing internet infrastructure and then makes the conclusion that “it’s not decentralized and has gatekeepers.”

He calls reliance on DNS, browsers, mobile phones and AWS as being “gatekeepers.” The reality is that those things are truly only “gates” if you can’t transition away from them or substitute them immediately.

Aka: Even if you have some aspects of your infrastructure which rely on “web2,” if you can substitute them for alternatives s then one could point out that there is no fundamental blocker to building decentralized systems on top of that.

My view is that crypto / Web3 are internet phenomena and internet technologies. Not replacements for the internet. So obviously they need to use internet stuff like DNS.

I have heard people talking about building private internets before, but I don’t think anyone in Web3 / crypto are claiming that they are going to replace the internet anytime soon. There are also many discussions around how to decentralize databases via IPFS, and replace DNS with something else.

Compute marketplaces such as GridCoin, Akash Network, etc are under development.

So those “gatekeepers” are getting eroded in real time, but browser and phone likely to remain.

The virtual machine is also under “improvement.” Folks are actively innovating new approaches to application specific VMs which will speed things up for specific use cases.

Furthermore, sovereign blockchains and subnets will allow much higher performance use cases for Web3 at the edge. Put all this together and most of the criticisms fall away.

My personal opinion is that we are going to see all tech stacks rebased around wallets as the core construct and this is going to force a rewrite of nearly everything.

This is happening and it’s not a scam.