1/ *Centralized* apps building atop decentralized protocols may be the winning combination, each furthering the adoption of the other.

2/ As many have pointed out, “decentralize all the things” is a mistake. Decentralize the things that benefit from decentralization.
3/ Starting with centralized apps (think @coinbase @circlepay etc), if you’ve been paying attention, they are utilizing an increasing amount of decentralized protocols & open-source crypto infrastructure, to the benefit of their end users.
4/ The realization this week that @coinbase and @circlepay built their #stablecoin on top of @zeppelin_os was another tick in this trend. https://t.co/rpgyQJ8Sdo
5/ Centralized #crypto apps that build upon decentralized protocols have:

-Global capabilities from day one
-Lower costs due to the on-demand and perfect-competition nature of protocol services
-More rapid innovation as they build upon others’ open source building blocks.
6/ Long term, centralized #crypto apps that build atop decentralized infrastructure will find it the key to what allows them to scale beyond, and outcompete, incumbents that fear public networks & cling to owning their infrastructure.
7/ Having covered cloud companies for 3 years & seeing how long it took big incumbents to embrace the public cloud (and some still haven’t), I have a hard time seeing these incumbents embrace decentralized protocols before it’s too late. Their loss.
8/ All of this leaves decentralized apps (#dapps) in hot water. As many have been pointing out, pure-play dapps are not getting much use.
9/ Connection points to end users need to be hyper-responsive, and due to the laws of physics, #dapps are fighting an uphill battle against centralized apps in response times.
10/ Projects like @graphprotocol or Picolo Network (https://t.co/hd1aN5nO0s) are aiming to help #dapps with their response times, but it remains TBD if it will ever be good enough for a human to not discern the lag.
11/ I also think customer service via #dapps is going to be a hard problem to solve, as customer service is high-touch and doesn’t come for free.
12/ Centralized apps in #crypto also currently have the vast majority of *distribution* to the end user, which so long as they continue to remain technologically relevant I have a hard time seeing them cede to #dapps.
13/ For these reasons, if you’re focusing on investing in #cryptoassets (as @placeholdervc is), I recommend focusing on layer 1 protocols, and important middleware protocols atop the layer 1’s.
14/ Look at what protocols the centralized apps are building atop, and getting real utility out of.

Those will have fundamental value, regardless of how much some obsess over “economic abstraction” and “infinite velocity.”
15/ As always, I’m open to being proved wrong, but I feel reasonably confident that in the short-to-medium term it will be the centralized apps that continue to capture most all of the users — longer term, as people work to make dapps more responsive, we’ll see.

More from Tech

Recently, the @CNIL issued a decision regarding the GDPR compliance of an unknown French adtech company named "Vectaury". It may seem like small fry, but the decision has potential wide-ranging impacts for Google, the IAB framework, and today's adtech. It's thread time! 👇

It's all in French, but if you're up for it you can read:
• Their blog post (lacks the most interesting details):
https://t.co/PHkDcOT1hy
• Their high-level legal decision: https://t.co/hwpiEvjodt
• The full notification: https://t.co/QQB7rfynha

I've read it so you needn't!

Vectaury was collecting geolocation data in order to create profiles (eg. people who often go to this or that type of shop) so as to power ad targeting. They operate through embedded SDKs and ad bidding, making them invisible to users.

The @CNIL notes that profiling based off of geolocation presents particular risks since it reveals people's movements and habits. As risky, the processing requires consent — this will be the heart of their assessment.

Interesting point: they justify the decision in part because of how many people COULD be targeted in this way (rather than how many have — though they note that too). Because it's on a phone, and many have phones, it is considered large-scale processing no matter what.

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