Is Web3 really changing major industries and products?

Web3 has seen increasing growth in Web3 business models across major industries. But whether it is still improving the core industry and products is an open question.

According to a June Coinbase study, more than half of the 100 US companies listed in the Fortune 500 have adopted Web3 initiatives since the beginning of 2020.

About 60% are in the pre-launch stage or have been launched since the beginning of 2020. Of the surveyed Fortune 500 executives who are familiar with blockchain, 83% say their companies have current initiatives or are planning to.

Speaking to Cointelegraph, Pat White, co-founder and CEO of digital asset platform Bitwave, believes there is progress in successfully marrying Web3 with the mainstream.

“It has the potential to drive innovation across many industries — and we're starting to see some early use cases outside of the crypto-economy,” he said.

Eliminating middlemen, reducing costs, improving data integrity, supply chain transparency, increasing cyber security and creating new ways to connect with customers, especially in finance and healthcare, are important, he said.

Related: How smart contracts can improve efficiency in healthcare

Healthcare has some promising use cases for Web3 in these areas, including services now appearing in Metaverse, particularly for those seeking mental health care.

Some companies are experimenting with storing and managing medical records using blockchain. A company has released a Covid-19 medical certificate on the blockchain.

It's all still in the early stages of research, though, and it remains to be seen whether Web3 will be more effective than existing systems in healthcare.

Just because you can't doesn't mean you should.

A few top-tier companies in the mainstream are already using Web3. For example, Starbucks has launched an NFT-based rewards program.

Goldman Sachs and Microsoft are building new blockchain networks focused on financial institutions. Elon Musk has been teasing a crypto payment option on X (formerly Twitter) for some time.

White believes there are use cases for Web3 in major industries, but that doesn't mean everyone can drive efficiency with Web3 tools.

Earlier in 2023, the high-performance sports car manufacturer Porsche had to stop abruptly after the failure of the NFT project and due to high consumer prices and lack of consumption.

Our owners spoke. We are discontinuing our offerings and ceasing to mint to move forward creating the best experience for a unique community. More information in the coming hours.

— PORSCHΞ (@eth_porsche) January 24, 2023

“Organizations can quickly get into deep water when they try to use only their legacy tools and processes to manage digital assets. New technologies require new ways of doing things,” White said.

“In the recent downturn, we've seen unsustainable companies exit the Web3 space.”

White said that using Web3 technology shouldn't be taken lightly, and that any “strategic decision” to enter the space should be coordinated across departments.

Currently, it sees Web3 at the same level of development as the Internet in the late 90s. There are many assumptions, and many companies want to incorporate the new technology without a plan.

“The nature of innovation cycles is that during the hype cycle, many people try technology for many purposes, and some of them may not really understand the innovation,” he said.

Brendan McKittrick, founder and chairman of the Decentralized Aviation Forum, told Cointelegraph that he thinks Web3 holds promise for improving everyday products and services in areas such as supply chain transparency and information security.

The extent of this improvement depends on how effectively Web3 is implemented. McKittrick said that as with any new technology, there are obstacles and challenges for major companies using Web3.

“Some major businesses may use Web3 to glamorize it and attract investors, which may create a superficial integration that doesn't offer significant benefits,” McKittrick said.

“These missteps can be valuable learning experiences that can help industries improve their approach and maximize the long-term benefits of Web3.”

In some cases, the adoption of the technology is out of the company's hands, like French game Ubisoft, which had to slow down plans to use NFTs and blockchain after player backlash.

Related: Ubisoft launches Ubisoft Quartz platform for playable and energy-efficient NFTs

Overall, McKittrick believes that Web3 is not just about technology; It's a mindset that involves rethinking decentralization, trust, and ownership—all of which could benefit the core industry.

However, he believes that in some cases the systems already in place may be more effective, and while Web3 has “great potential for various applications”, its suitability “depends on the specific needs and characteristics of each industry.”

“Universality is tempered by the need to carefully consider the unique requirements and constraints of each industry,” says McKittrick.

“Some sectors may not have much use for decentralized or blockchain technology, and traditional systems may still be more cost-effective and efficient for them,” he said.

Some major industries are using Web3 successfully.

Kadan Stadelman, chief technology officer of blockchain platform Comodo, told Cointelegraph that, in his opinion, Web3 Tech is improving products in major industries such as music, gaming and real estate.

Related: Web3 is changing the music industry – here's how

In the music arena, Web3 technology helps artists cut out intermediaries such as record labels and streaming services, allowing artists to connect directly with their audiences.

“Web3-minded musicians are in control of their creative work, which helps ensure fair compensation for their efforts, because decentralized music platforms offer transparent royalty systems,” Stadelmann said.

“Artists receive instant payments for their streams or downloads without complex contracts with sleazy independent labels or major labels.”

Web3 Technology has been very active in the music scene, from providing song rights royalties and blockchain licensing to NFT certified music copyrights such as Sony Entertainment.

Artists are beginning to explore new ways of fan engagement using wallet-based loyalty incentives and token-based communities. Earlier in 2023, Harry Styles' fans opened a crypto wallet through a third-party app.

Empowering true ownership for music fans.

Creative teams like @tryevntz are plugging and delivering personalized fan-first experiences — powered by @usecocreate's flexible APIs.

Starting with @Harry_Styles https://t.co/q5AeHF8FCU

— Polygon Labs (@0xPolygonLabs) June 26, 2023

In the game, the Stadelman central authority cannot control the platforms powered by Web3; Instead, they run on decentralized networks like blockchain.

“This shift to decentralization has many implications for players. It enhances ownership and control of in-game assets,” he said.

“Players can actually own their virtual assets and even trade with others securely and transparently,” Stadelman added.

For the real estate industry, Stadelman says Web3 can provide a framework that allows peer-to-peer transactions and smart contracts without intermediaries. Tokenization also allows assets to be divided into digital tokens that represent ownership stakes.

“This enables fractional ownership and opens up real estate investments to a wider range of individuals who haven't had them before,” Stadelman said.

“Transparency and flexibility in asset transactions will reduce fraud and increase trust between parties. Web3 also empowers individuals to monetize their assets through decentralized financial platforms,” ​​he added.

Stadelmann believes the fashion industry has also benefited from an injection of Web3 tech, which has the ability to facilitate peer-to-peer interactions between designers and consumers.

Designers can protect their intellectual property rights and be compensated for their creations through smart contracts, certifying products and fighting counterfeiting, he said.

“Unique digital identities can be assigned to each piece of clothing, allowing consumers to verify its authenticity with a simple scan,” Stadelman said.

“This not only protects brands from loss of revenue, but also gives consumers confidence in their purchases,” he added.

Web3 has potential but still needs further development for mainstream

Bradley Allgood, CEO and founder of fintech company Fluent Finance, told Cointelegraph that he thinks Web3 technology has potential to be used in the mainstream financial world.

But he says the on-chain and legacy worlds need to reach consensus on a trusted gold-standard exchange that can flow without conflict between the on-chain and traditional financial ecosystems.

“Until then, it will be more of the same adoption efforts and marketing incentives,” he said.

“Like any technology, it's value-driven: it needs a healthy exchange and financial infrastructure to support business applications,” Allgood added.

Related: Web3 gaming still a long way from mainstream adoption: survey

Currently, Allgood says in his experience, Web3 integration processes are messy and inefficient and create poor user experiences because the middleware and interoperability infrastructure aren't there yet.

Attempts have been made to marry Web3 and blockchain in finance. Major payment processor PayPal has announced its PYUSD stablecoin, and payments giant MasterCard is exploring the benefits of crypto through a new partnership with crypto payment platform MoonPay.

Allgood believes that Web3 will continue to be mainstreamed with sufficient real-time transparency as long as it provides strong custody and a stable value asset.