Decentralized applications and protocols have captured the attention of mainstream audiences in recent years. Unsurprisingly, much of the growth in interest and adoption has been due to the emergence of NFTs, a subset of blockchain technology that places art, culture, and entertainment at the center of web3.
Yet despite this surge in adoption from the entertainment industry, there still remain several barriers for other industries such as finance, healthcare, and supply chain/logistics to see the same rate of adoption of decentralized protocols.
While lack of education and regulatory clarity plays a role, the inability to overcome certain User Interface and User Experience (UI/UX) challenges in order to fit web3 solutions into a web2 design framework is also a primary cause of slow adoption. These include a single sign-on (SSO) experience for all blockchains as well as frictionless value transfer between networks, both of which are made challenging by the highly decentralized nature of the web3 ecosystem.
Despite the many flaws of web2 platforms, the ease with which information and services are centralized and standardized is a huge advantage that web3 has yet to replicate.
Through platforms like Facebook, Twitter, the Apple App Store, or Google’s search engine, disparate applications and resources are aggregated together in a way that makes finding the right resources and communicating with the right people easier than ever.
By contrast, web3 consists of an assortment of Dapps, protocols, and networks that are loosely tied together using cross-chain bridges. While these bridges allow users to transfer value between networks, they are primarily geared toward crypto native users and remain largely unusable for companies that operate in the traditional economy.
What web2 gets right, that web3 has yet to perfect, is a method of universal standardization brought on by some degree of centralization. Yet in order to avoid the mistakes of web2, web3 must figure out a way to aggregate and standardize information and applications without controlling the underlying infrastructure that has traditionally made standardization possible in the first place.
The Accumulate Network solves this problem by enabling web3 projects and web2 applications to coalesce under a single communication and audit layer using decentralized digital identifiers to represent individuals, entities, and assets on-chain. .
Accumulate’s solution enables web3 projects to better capture consumers in healthcare, finance, supply chain, and other industries by providing them with a seamless onboarding experience.
How Accumulate Enables Web3 Projects to Connect To The Web2 Economy
Today’s decentralized application (Dapp) developers are faced with a multitude of options for where to launch new protocols. This decision ultimately comes down to the difficulty of the coding language (is this something I along with current and future team members can easily master), composability (how easy is it to port my code over to other networks), and network effects (is the network I’m building on already populated with many existing users, investors, and projects).
For a long time, the de-facto option for many Dapp developers was Ethereum, yet with the emergence of other EVM compatible chains like Avalanche, Polygon, Fantom, as well as faster chains like Solana, we are beginning to see an increasing fragmentation of the web3 space.
While cross-chain bridges make it easier for users to transfer funds in a multi-chain world, the current menu of interoperability solutions is primarily geared towards crypto native users and not those who still operate in the traditional economy.
While bridges technically solve the problem of network fragmentation, they do not solve the poor UX and UI problem, which is primarily where the rift exists for traditional companies that wish to onboard onto Web3.
Accumulate’s identity layer abstracts away much of the complexity associated with using various cross-chain bridges and wrapping tools to achieve interoperability and replaces them with a single communication and audit layer.
Web2 platforms, Fortune 500 companies, large enterprises, SMEs, and startups can be onboarded to Accumulate and create Accumulate Digital Identifiers (ADIs) to represent all aspects of their organization on-chain.
ADIs are human-readable addresses similar to website URLs that are chosen by individuals or assigned by organizations to represent their presence on the blockchain. ADIs can also represent different types of digital and physical assets including stocks, real estate, etc.
One can think of an ADI as a digital wrapper that allows one piece of data to be represented in a standardized way on a network designed specifically for seamless integration with the traditional economy.
For DeFi Dapps, Accumulate can provide instant access to real-world assets such as accounts receivables, manufacturing materials, or patents and IP that can be used as collateral for smart contract loans. Furthermore, the ability of traditional banks, market makers, and hedge funds to form a presence on-chain using ADIs will provide the DeFi ecosystem with billions of dollars in additional liquidity and credit.
ADIs provide financial institutions with a framework to adopt blockchain technology in a completely regulatory way, with full traceability and auditability of all transactions that occur between individuals and entities that are also represented as ADIs.
What’s more, protocols developed by anonymous teams can port assets and user accounts over to the Accumulate network where they can interact with KYCd entities.
Increased Flexibility for Dapp Developers
Aside from Accumulate’s unique implementation of a digital identity layer, the Accumulate Network is also a modular blockchain, meaning it splits the execution, consensus, and data availability functions of a typical monolithic blockchain into multiple specialized components, enabling optimal performance from each individual chain.
The ‘chain of chains’ architecture not only enables Accumulate to strike the right balance between scalability, decentralization, and security, but it also empowers developers to launch Dapps as application-specific blockchains or ‘managed chains’, meaning the Dapp sits on top of its own blockchain that is operated by a node structure and consensus mechanism of the developer’s choice.
This solves one of the biggest challenges for Dapp developers today, which is the reliance on an underlying blockchain that they did not design and cannot modify.
Whenever the Ethereum network experiences high gas fees due to network congestion, all Dapps on the mainnet are affected and are unable to do anything to mitigate the poor user experience. Similarly, during periods when the Solana network has gone down, all Dapps on Solana also experienced downtime.
Accumulate empowers developers to launch their own chains that can be used to build highly scalable Dapps (e.g for trading or gaming) or highly secure Dapps (for storage and transferring high-value assets).
Additionally, whenever a Dapp is experiencing very high traffic, network congestion can be alleviated by spreading the load over to parallel blockchains that the developer controls.
ADIs also complement this design by tying multiple user accounts from various chains onto a single identity, enabling users to have the experience of using one network even though they are interacting with several application-specific blockchains.
Companies will be able to deploy assets to both private-permissioned and public-permissionless chains to participate in lending, borrowing, trading, providing liquidity, and more. All of these activities would easily be tied back to their ADI, giving them a clear trail to follow for accounting and auditing purposes.
A solution to integrate Web2 into Web3
UI and UX play a critical role in the adoption of web3 protocols, especially when standardizing the user experience so that individuals and entities can feel as though they are onboarding to a single network as opposed to a collection of fragmented chains loosely connected by bridges.
Accumulate aims to anchor the entire web3 ecosystem to its digital identifier system, giving crypto native developers and participants from the traditional economy a one-stop destination to communicate and exchange value.
Web 3 Standardization Framework
Furthermore, Accumulate embraces a modular blockchain architecture to empower developers to launch Dapps with full control of their underlying infrastructure. This design also gives entities from the traditional economy the flexibility to operate on private permissioned networks or public permissionless networks, both of which can be used to interact with web3 projects without limiting the ability to trade assets between chains (for example, enterprises leveraging tokenized public assets as collateral to borrow capital on public chains, while lending private assets to KYC’d clients on private-permissioned networks).
Through all this, the end goal is to create a path for web2 users, platforms, and companies to integrate into the web3 ecosystem. While there are many entry points by which this integration can be achieved, the use of digital identifiers and a highly flexible blockchain architecture will allow Accumulate to provide the simplest and most user-friendly entry point for platforms, enterprises, SMEs, and startups to onboard themselves to this rapidly growing space.