Newsletter: Brands in Web3 & Web3 in Brands #6

This week: Coinbase illustrates the far-reaching perils of brand inconsistency; PayPal steps into stablecoins as fintech firms move to the frontier of adoption.

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Newsletter: Brands in Web3 & Web3 in Brands #6

Brands in Web3 & Web3 in Brands

Welcome to Edition #6 of “Brands in Web3 & Web3 in brands“, your regular dose of the latest news from the blockchain, crypto, and Web3 space, curated to provide unique marketing and brand strategy insights with a pinch of spice. 

This week: Coinbase illustrates the far-reaching perils of brand inconsistency; PayPal steps into stablecoins as fintech firms move to the frontier of adoption. 

Everything, for everyone, all at once 

In the coming days, THE RELEVANCE HOUSE will publish a first-of-its-kind report on the state of branding in the Web3 sector based on our proprietary research methodology. The first in a series titled “Everything, For Everyone, All At Once,” the initial release will focus on centralized crypto exchanges. There will be further editions looking at different segments within our space.

We’ve been working on this for months, and I can’t wait to finally share the results with you all! 

I initiated this research based on an observation that I could see but not easily prove – that the Web3 sector isn’t performing when it comes to brand consistency, attempting to be all things to all people all the time. 

This week, in an almost perfect coincidence of timing, a story emerged about Coinbase, which demonstrates exactly how damaging this inconsistent approach can be on multiple levels. 

As part of its ongoing legal dispute with the SEC regarding the alleged illegal sale of securities, Coinbase had made some extremely odd claims. To support its argument that crypto assets aren’t, in fact, securities, Coinbase claims that:

“There is no investment of money coupled with a promise of future delivery of anything. There is an asset sale. That’s it. It is akin to the sale of a parcel of land, the value of which may fluctuate after the sale. Or a condo in a new development. Or an American Girl Doll, or a Beanie Baby, or a baseball card.”

Baseball cards? Beanie Babies? 

What happened to “fueling progress on decentralization, Web3, and the future of finance”? 

To be fair to Coinbase, it is far from the only culprit when it comes to these kinds of mixed messages, as you’ll see in our research. Coinbase just happened to be the first that came along with such a timely, clear-cut example that illustrates the central argument: crypto brands have not clearly delineated their offerings. 

They are trying to be everything, for everyone, all at once.

In the case of Coinbase, there are some clear lessons here. 

✅ Those watching your brand and your messages aren’t just your target audience and competitors – other interested parties (regulators in this case) are also watching. 

✅  Get it wrong, and they’ll notice. 

✅  Once you start having to backtrack and re-clarify your messaging, the damage to your brand is already being done. 

Coinbase’s dramatic statement very nearly had our team running back to the drawing board. After all, if a brand is changing its message, shouldn’t we update our research to reflect that? 

Well, no. The objective of the report is not a general statement on branding – it’s all about consistency. So if we change our findings every time a brand updates its website or mission statement in response to external events, well, our research will end up just as inconsistent as the brands we’re trying to analyze. 

So how is this inconsistency manifesting, what’s the impact, and most importantly, what can brands to to make it better? 

Watch this space, as we will be publishing the research very soon! 

Is PayPal a stable force for crypto?

History often repeats itself in crypto, most famously in market cycles. So when PayPal announced it was launching a stablecoin, I expected it to mark a recurrence of what happened in October 2020 when the fintech giant announced it was moving into crypto. At that time, it acted as a starting pistol for the next bull market. 

But this time? 

At least from the market perspective, nothing really moved. 

And then there was the response from the crypto sphere. In 2020, I recall a palpable sense of collective excitement at PayPal’s announcement that largely drowned out any naysayers. This time around, there seems to be more focus on the lack of decentralization than on the potential for adoption and attracting further development and investment to our industry. 

(Once again, for the benefit of new readers and doubters – I am a huge proponent of decentralization, as well as the individual and financial sovereignty it can bring, among many other key benefits and basic human rights. However, the vast majority of people don’t share this thinking. And since my role in life is to help bring Web3 to the vast majority of people, we need other selling points). 

There are other criticisms of PayPal, some from within the TradFi sector – for instance, that it won’t prove competitive enough to established players like USDC or yet-to-emerge newcomers. 

My view is that enterprise adoption at this scale may come with some compromises on elements such as decentralization and privacy. But PayPal’s entry hasn’t come at the detriment of the rest of the industry, so there is no zero-sum argument to be made. Even if all PayPal offers to users is an on-chain record of off-chain assets, other, more decentralized options still exist for those who wish to use them, at least for now. 

Which even further reinforces the point that we in Web3 need to justify the argument for decentralization beyond ideology. Otherwise, we have the same sales problem that the climate lobby has been suffering for years – a lack of tangible reality for people to grasp. 

What’s more, PayPal’s brand power has the potential to bring benefits that don’t just outweigh any compromises. They could ultimately secure the longevity of our industry in a far more sustainable way than evading regulators through decentralization and privacy protocols. 

I’ll be maintaining the benefit of the doubt and hoping that market movements notwithstanding, history repeats itself to move broader sentiment in favor of Web3. 

Advancing adoption

Fintech is currently in the front seat when it comes to recent adoption-related news. Along with PayPal’s big announcement, Visa has also been doing its part with some research into the notorious gas fee problem on Ethereum. No, not the high prices that so often make crypto headlines, but the major usability barrier of requiring an ETH balance to pay the gas fees necessary to carry out any transaction on Ethereum. 

It’s a huge headache and one that Visa is leveraging its expertise to solve by enabling gas fee payments using fiat currency. Moves like these will make genuine strides into adoption by removing barriers to entry for everyday users who simply will not tolerate the kind of friction that crypto users willingly embrace for the sake of decentralization or privacy. 

Coinbase was also in the headlines for other reasons this week as the news emerged that it has won approval from the US National Futures Association to offer regulated futures trading to eligible customers. The move is a welcome boost – not just for Coinbase, but for the future of regulated cryptoasset trading in the US. 

In an intriguing kind of funding role reversal that could see crypto innovation reach further into the fintech sector, the Stellar Development Foundation, the nonprofit responsible for developing the Stellar blockchain and ecosystem, has become a minority investor in Moneygram International. Despite the minority status, the SDF now has a seat on Moneygram’s Board of Directors. This could represent a different model for stimulating adoption, directing Web3 investment into established firms to leverage their networks and economies of scale, so I’ll be watching closely for future developments. 

In other Web3 adoption news, Adidas has unveiled a limited edition sneaker collaboration with BAPE, featuring a digital twin NFT version that will function as metaverse wearables. The “Triple-White Forum 84 BAPE Low” will be sold at a first-of-its-kind for Adidas auction in a limited release of just 100 pairs. 

Out and about in Web3

Crypto has been great at attracting headlines, but my long-held dream of sparking mainstream adoption has been an elusive goal so far. Recently, I contributed to this article with my view on what could trigger public interest in crypto. 

Read: “13 developments that could kindle the public’s interest in the crypto industry”

I’ve also been invited to moderate at the upcoming Swiss Association of MBAs Digital Leaders Conference in Zurich. Come and see me at PwC Oerlikon on August 23 alongside speakers from Clariant, Swarovski, Julius Baer, and more. 

See my LinkedIn post for more information about the Digital Leaders Conference.

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