Web Three Point Oh! Web3 is a buzzword, one that invokes strong reactions. Gavin Wood, the co-founder of Ethereum who coined the term in 2014, had a concept in mind. “Web3 is really sort of an alternative vision of the web, where the services that we use are not hosted by a single service provider company, but rather … in some sense, hosted by everybody.” Its decentralized nature leads to the connection back to digital assets as a “trustless” model built on math rather than centralized corporate structures. The use of the web3 term exploded this year. Google Trends shows that worldwide interest is near its peak popularity. Decentralized Autonomous Organizations (DAOs) are a critical organizational ingredient to web3. DAOs provide the governance and voting structure to replace traditional centralized corporate structures. Like so much of the digital ecosystem, the promise is great. DAOs are the driving force in DeFi protocols like Uniswap, have led trends in social clubs such as Bored Apes, cover charitable organizations like DreamDAO, and even penetrated asset management through MetaCartel. With great promise comes great challenge. The democratization of organizational structure isn’t very democratic just yet – less than 1% of all holders have 90% of the voting power. Behind every DAO is also a treasury that holds reserves, connecting governance to crypto assets. But the downturn in asset prices is seeing much less risk appetite, with DAO treasuries shifting toward US dollar stablecoin. Already, USDC and DAI stablecoin are the two most common assets held in DAO treasuries, though not dominant in size. The next upward trend in digital asset markets could unlock much utility. It may also see a narrowing in the value proposition. Web3 is reliant on digital rails. But web3 isn’t crypto, and crypto isn’t web3.