In my first article in this series, I explained why Ethereum and Steem cannot offer a massive decentralized social application (DApp). In the second post, I explained how EOS tried to integrate features from both series, but did so in a way that users still had to buy expensive RAM for accounts and smart contracts.
In this article, I will take a different approach to this issue, based not on comparisons with existing platforms, but on initial principles. Instead of limiting our perception to the limitations of the first attempt at a generic blockchain, let’s look at the problem from a developer’s perspective. What do they need to provide the experience that regular users want? In my previous article, I described it as “no fees, no exceptions”. In other words, they want absolutely free apps.
Create a free DApp from first principles
The first thing a user needs to use any app is an account, so introducing a fee here will immediately create a negative user experience. We want to reduce user friction in order to maximize penetration – we definitely don’t want to force them to buy an account. But we don’t want to solve this problem by simply making the developer pay to create an account, as this will increase their costs.
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This problem is simple because it has already been solved by Bitcoin and Ethereum, which allow users to create addresses for free. When we think about first principles, then if we don’t want developers or end users to pay for accounts, we need a block chain with addresses that act like accounts.
Using addresses similar to Bitcoin or Ethereum, we can create accounts without having to pay end users or DApp developers. fantastic. But now we want people to actually use a decentralized application, which means we want them to run a computer program on a decentralized computer and use some computer resources. We want to let them do something that has a real price that someone has to pay. The only question is who, right? Well, that suggests there’s only one way to blame people.
This is where first-principles thinking is of great value. Fees are the traditional way we charge people to use the blockchain, so if we just assume this is the only solution, the only possible option would be whoever pays the fees rather than an alternative approach to the problem.
Related: The Power of Cheap Transactions: Can Solana Growth Surpass Ethereum?
Collect opportunity cost
Taking people’s money is one way of imposing costs (i.e. reducing their token credit), but there is another type of cost: opportunity cost. Deprive people of the opportunity to use their symbols (i.e. their money).
If we can create a decentralized system to “charge” people for using the blockchain, not taking their tokens, but preventing them from using their tokens (for a certain period of time), then we can allow them to use the blockchain. chain without taking any of their badges.
Also, once this period has expired, they can use the blockchain more, which means they don’t have to constantly buy more tokens to be able to continue using their favorite app. This will greatly increase user retention and maximize growth.
Video game experience
Now we have a mechanism for charging users, which is not like a fee, but our goal is to provide a dominant user experience. Requiring people to intentionally lock up cryptocurrencies before they can use the app is not a common user experience.
If we can’t consciously require people to block tokens, we need a system that makes it easy for people to use the blockchain without thinking. All this means that the system must determine the opportunity cost instead of the user. Putting this decision out of the hands of the user allows us to design the system so that the opportunity cost is as low as possible while maintaining financial sustainability. This gives the user the assurance that they will never “overpay” (even if it’s just an opportunity cost) while maximizing growth by lowering barriers. The cheaper the transactions, the lower the fees will feel – the better the user experience – and the faster we can expect the user base to grow.