OpenSea, the world’s largest marketplace for NFTs, has blocked users from Iran including Iranian artists. We have been hearing about similar cases on different platforms, including Soft Wallet. I thought the entire point of Web3 was decentralisation, accessibility to everyone. Do you think the basic philosophy of Web3 is under threat?
We are potentially moving towards a world that is less globalised. As the world deglobalises, the question to ask is whether we will still have one internet.
If we do not have one superpower, we are seeing some tension arise on that front. As a result, some of these companies — which are centralised and are regulated in the United States and are subject to the laws of the jurisdiction of that state, will be required to abide by any sanctions.
This is a feature that we will continue to see.
An example of this is China’s banning of Bitcoin mining. It is not that we had not expected countries to respond this way, it was actually built with the ability to sustain such action. What we should be focussed on is seeing what happens after such sanctions or such laws are imposed. Does the system become more anti-fragile because Web3 is permission-less or does it really just end up becoming a system like Web2 is a question.
If we were to use China as an example, once mining was banned a lot of the miners relocated immediately to places where mining was allowed. Mind you, some of the companies that you have mentioned might have decentralised versions of these platforms that are able to operate in jurisdictions other than the United States. As such, they need not comply with this. At the same time wherever there are global laws or global standards applicable, they will continue to apply. It is just a wait-and-watch. One has to see how antifragile the ecosystem truly is.
With what MetaMask did, can the Indian government come and ask it to ban services for whatever reasons because it can be done and we are seeing it happening before our eyes?
There is a possibility but the policy in India has been changing: from suggesting a ban to now looking for a path to regulate it with taxation.
It is the first step and potentially some more meaningful regulations will come out in the coming months and years.
Therefore, such a ban would be unlikely in India but, yes, that is a possibility. India has the opportunity to be consistent with the values that we have had of non-aligned movement and build neutral rails and protocols for the world to access, where some of the rails of the internet that we are used to so far have become politicised and in some ways may end up getting fractured.
We do see a balkanisation of the Web2 internet, it is a massive opportunity for the engineers and builders and the founders in India to build neutral rails and protocols for communication and payments for the world. This is not something that is unprecedented, we have done this with in the case of UPI, where our payments infrastructure is way ahead of other countries globally.
If internet companies and start-ups are going to succumb to foreign policies of the United States or Russia, we have the opportunity to fill the void that will be created in the paradigm of Web3 and cryptos.
One of the world’s largest crypto platforms Coinbase has said that it is not preemptively banning all Russians from using Coinbase, but added that if the US government decides to impose a ban in Russia on cryptos, it will be following those laws. The Ukrainian Vice-President has made a clarion call, asking for donations in Bitcoins. It is something that we also saw in India during the deadly Delta wave. What is happening on that front when it comes to Ukraine?
I do not know what the latest donation statistics are, but I do know that it was in the low-to-mid eight figures, when I last scrolled Twitter. The broader point here is that we are seeing an unprecedented world where financial technology is getting politicised and weaponised. We saw seizing or freezing of bank accounts of truck drivers who took part in the protest in Canada and we also saw seizing of the central bank assets of a nuclear power Russia. This has never happened at this pace. This is deeply saddening as the collateral damage is civilians like the Russians, who cannot use their Apple Pay while going to the metro stations or the Ukrainians who cannot get to work because there is a war going on.
How far does that extend, we do not know. But there are rails for communication and payments that do not go down regardless of how powerful a country is and that give us the hope for building a version of the internet ,where you can both be compliant with local laws as well as have a channel of communication open with the external world. Without these technologies, it would be a pretty bleak future for the internet, if one were to subject everybody to the changing nature of foreign policy of every country around the world. This is a massive entrepreneurial opportunity to build a version of the internet that is consistent with the experience we have been used to and I cannot think of another country that has the deeper technical bench strength than India to be able to do this.
You do not need an H1-B visa to work in the US and build that version of the internet. You can do it sitting wherever you are, That is promising.
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