In the decade since Ethereum co-founder Gavin Wood first coined the term “web3,” we’ve seen the promise of a new digital empire rise into reality. Cryptocurrency has become a trillion-dollar mainstain of the global economy; NFTs have entrenched themselves in high-stakes art and investment trades; blockchain-based financial services have transitioned from novelty to normal.

For all the above, we can thank the dreamers and developers who took it upon themselves to create solutions that consumers didn’t even know they needed. It’s not a stretch to say that their creative determination built our nascent web3 empire; today, the ecosystem encompasses tens of thousands of dApps and an expansive variety of defi services.  

The question is, will that same creativity topple it, too?

Web3 proliferation is undercutting user adoption

In theory, web3’s innovative explosion should accelerate user adoption. As offerings multiply and diversify, the ecosystem naturally becomes more intriguing. However, while user adoption has been respectable enough in recent years, the rates we see today are far disproportionate to web3’s apparent value proposition.

Why? We have a chain fragmentation problem. According to a report from CoinPaper, over 1,000 distinct blockchains were operational as of January 2024. The Ethereum ecosystem features over 50 L2s today, with another 50-plus anticipated to go live soon, all competing for users and liquidity. 

This fragmentation has an intense impact on experience. Users often need to manually switch between networks within their wallets or interfaces, which can be confusing and lead to frustrating (or even costly) errors. L2, L2, and L3 chain proliferation forces users to keep their available assets and gas tokens in their wallets if they want to sample emerging applications built on those chains. And when they do, they face a learning curve: each blockchain poses its own set of rules, transaction fees, and functionalities.

Given these challenges, is it any wonder that mainstream consumers have hesitated to leap into web3? To unlock widespread user adoption among mainstream consumers, we must deliver more seamless, intuitive user experiences.  

The intuitive answer would seem to be to encourage developers to improve cross-chain compatibility and interoperability. However, relying on individual developers to provide global interoperability is a bit like asking someone to empty the ocean with a bucket: the scale of the challenge renders the request laughable. 

Chain fragmentation is constraining blockchain developers

Today, the web3 ecosystem features a thousand active blockchains; we could see ten times more in five years. Blockchains are proliferating at an exponential rate as innovators build chains that cater to particular industries, interests, or business use cases—and given the early success and adoption of the blockchain modularity thesis, this fragmentation will likely intensify. 

But even if chain proliferation was a tenth as quick as it is today, developers could never keep up. Unlike web2, where innovators can build once and attract users from across the internet with few limitations, web3 developers typically need to deploy instances of their apps on multiple chains to chase users and liquidity. As a result, developers need to spend their time building insecure, inefficient, and inelegant cross-chain messaging solutions rather than elevating their core value proposition. 

To return to our empire metaphor: instead of expanding web3’s reach and resources, architects and builders are reduced to patching cracks and digging connective tunnels between city sections, exhausting themselves with work that most denizens will never see or appreciate.  

So, how do we alleviate web3’s user experience problems and give developers more time for value-adding innovation? The answer lies in chain abstraction. 

Chain abstraction is a necessity for users, developers, and web3 overall

Imagine a world where our fragmented chains were abstracted away. Developers might build a single instance of their app on the chain of their choosing and attract users across any chain without interruption or inconvenience; users would not need to know which chain that app was built on or worry whether their assets and gas tokens are compatible. 

To build this functionally abstracted ecosystem, web3 advocates would need to meet several requirements. First, user balances would need to be unified, aggregated, and accountable across all chains to ensure that users could spend their balances freely without hassle while preventing intentional or accidental overdrafts. Additionally, developers should not need to incorporate complex integrations into their solutions to facilitate cross-chain accessibility.  

Much like Rome, an abstracted web3 empire won’t be built in a day—but there’s little doubt that we need to start building today. Unless there is an ecosystem-wide effort to prioritize abstraction, we won’t have the opportunity to unlock mainstream adoption. We owe it to the web3 architects and innovators to ensure that their visionary work receives the acclaim, appreciation, and utilization it deserves. 

Mayur Relekar is the co-founder of Arcana. A former chief products officer at Wow Labz, Mayur co-founded Arcana to simplify blockchain complexities and enhance user experience. The company is backed by top industry funds and angels, including Balaji Srinivasan, Polygon Ventures, Republic Crypto, and Woodstock Fund.