The Next Wave of Mass Adoption Through Web 3.0 Communications: Why Notifi Network is Changing the Game

Web 3.0 native communications is currently overwhelming to say the least and inherently broken. The total addressable market for Web 3.0 communications would be every decentralized application that involves human interaction including all developers, community leads and community members. With a communications as a service model, the serviceable addressable market could exceed $100–500B+ over the next 3–5 years (assuming crypto regains the conservative $3T market size once held in 2021). We are at the cusp of hitting escape velocity in decentralized Web 3.0 communities globally. Some may argue it’s already here.

Current issues with Web 3.0 communications

Despite recent catastrophic events in the industry involving centralized entities, decentralized Web 3.0 communities still boast millions of users and thousands of projects inside its nascent ecosystems.

In its current form, Web 3.0 communication across disparate channels such as Twitter, Telegram, Discord, and others is challenging and does not yield the desired results in terms of user experience, timely actionable project updates, and community member participation. There is also limited integration with native dApps, little customization, and too many messages from disparate channels. As a result, Web 3.0 projects’ ability to communicate effectively and consistently with their branding is hindered. With more dApps being developed in the Web 3.0 ecosystem, the problem is magnified as it becomes increasingly challenging to onboard users in the current Web 3.0 communities and keep them updated on events such as NFT mints, DAO voting, or liquidation events.

Current Web 2.0 platforms do not provide adequate solutions, and Web 3.0 projects therefore have to build their own customized solutions. Consequently, Web 3.0 projects have to dedicate significant resources to build and maintain such solutions without an expertise in this area and hence risk suffering losses in user engagement and retention as a result.

There are also major gaps in coordination and collaboration among many decentralized crypto native communities. Examples are abundant such as communication layers and proposal voting inside DAOs (estimated 978K DAO members), DeFi governance and alerts for liquidations and yield generation events with an estimated audience of 560K DAUs, NFT content creation and audience notifications on drops and whitelist announcements, to name a few.

Additionally, many projects’ direct messaging and key announcements get drowned out by the abundance of spam, bots messages sent by nefarious actors trying to take advantage of opportunities through Telegram, Twitter, Instagram and other ineffective Web 2.0 communication channels.

Communications pain points within DAOs and DeFi

To dive deeper into a couple of these examples, currently, many DAO communities operate in a fairly chaotic and erratic manner, often leaving proposal submission and token voting to a very few select group of ‘whales’ with direct incentive to pass through a decision on chain.

In many situations, the vast majority of DAO participants have little incentive or opportunity to understand technical proposals and its ability to impact the rest of the ecosystem and core functionality within a Web 3.0 protocol or project, leading to around 90% inactive participation within these decentralized communities. Additionally, most DAO participants are not properly informed in a timely manner and would need to either filter through the noise of all other Web 2.0 phone notifications, or keep a close eye on the few ecosystems they are interested in to jump on the proposals and key decisions at the right time before the window of opportunity closes. These communication and timeliness gaps present a major opportunity in on-chain user activity as well as ongoing cohesiveness of Web 3.0 communities.

Another great example of pain points in Web 3.0 communication is in the DeFi space. Users want real time on-chain notifications for buy, sell, borrow, lend, margin calls and limit orders. In many situations where users in DeFi are nearing a liquidation scenario on their collateralized assets, users want to be informed early since the volatility of the crypto markets can be unforgiving on days of peak volatility.

A prime example of this was the DeFi protocol, Solend case study where a Solana ‘whale’ had a large collateralized position on chain and was nearing a liquidation point when the markets were drawing down significantly during the 3AC contagion period. This user’s position at the time accounted for more than ~75% of the entire Total Value Locked on Solend’s platform, which would bring significant damage to both the protocol as well as the larger Solana ecosystem if liquidated at the time. If Solend and this DeFi user had adequate alert processes in place to notify him about his potential liquidation event earlier, this would have prevented significant widespread panic in the Solana ecosystem and various more positions getting withdrawn from the DeFi protocol.

Imagine New Possibilities in Web 3.0 communications experience

What is clearly missing from a user experience perspective in Web 3.0 is the ability to bring organization and clarity to all on-chain activities as well as Web 2.0 activities involving Web 3.0. Similar to a Twilio or Hootsuite approach, imagine a Web 3.0 like inbox, with a slick user interface where a user’s crypto activities are all displayed in one dynamic dashboard with real time analytical potential. With important alerts on Tweets, Telegram and Discord messages from a user’s more important projects, to on-chain volume changes, NFT mints, Yuga Labs community announcement and airdrop alerts, a Web 3.0 native user or Web 2.0 digitally savvy user interested in Web 3.0 can all benefit from the same user experience. This would be one step closer to mass adoption for crypto and blockchain technology.

Additionally, imagine a Web 3.0 support desk as a service for every decentralized application for users to ask questions and receive prompt responses through concentrate alerts. DAO to DAO cross-chain community messaging and communications, decentralized metaverse messaging across multi-chain worlds, on-chain to off-chain messaging and virtual reality to non virtual reality platforms messaging and notifications. There are many more examples of a need of Web 3.0 messaging and notification tools to go direct to users including developer community notifications, whitelist announcements, send & receive notifications on chain, peak volume and whale alerts for on chain movement, peak contagion liquidity management notifications, to name a few. We believe that the Web 3.0 messaging and notifications use case is a clear need that needs to be addressed for mass adoption of Web 3.0 to continue flourishing.

Thankfully, there are a few promising solutions on the market currently trying to address these gaps and solve these dire issues in user experience in Web 3.0.

Why Notifi is Changing the Game

Notifi is solving this problem by providing a purpose-built communication platform native to the Web 3.0 ecosystem. It provides tools that actively listen on-chain and understand the program/contract and SDKs for DApps to send notifications. As the number of DApps adopting this platform increases and more data is available to users, this will drive network effects with Notifi becoming a unified communication platform. Web 3.0 projects already benefit by using this platform in several ways.

First, Notifi’s platform saves its customers time and financial resources by providing an easy user-friendly platform. Onboarding is quick, and the platform is already integrated with major social media tools such as Telegram, Email, SMS, Discord, Twitter. Companies do not have to build and maintain their own custom solutions. Additionally, Web 3.0 startups benefit from the platform’s continuous improvements and upgrades. They can share best practices of Web 3.0 communication with other members, and can leverage additional communication tools integrated into Notifi’s platform. Finally, Notifi platform provides consistent branding and messaging experience to users. Users can sign-up quickly through channels they are already using and benefit from a consumer friendly model that allows users to granularly subscribe or unsubscribe depending on topics. Notifi provides users with in-app Inbox (“Notifi In-App Messaging Widget”) that enables users receive messages from all dApps they use.

Notifi currently has five main products that serve several dire customer needs in Web 3.0. These products have been cycle tested and early signs point to product market fit, especially given the customer feedback they have received to date as well as the overwhelming stickiness of these customers. A highlight testimonial includes Sam Thapaliya from Zebec — ‘We are absolutely in love with this product and cannot imagine not using it for all of our community and business needs’.

1. Notifi In-App Messaging Card is a drag and drop alert bell for contact preferences and customizable user experience embedded in any DApp or web wallet. The company provides a low code SDK to enable developers to embed their plug-and-play card and allow users to sign up for notifications from the DApp across whatever topics and channels they prefer. Notifi’s Card and SDK also offers standard components for customers to access alert history and view messages.
2. Notifi Direct is a self-service offering that allows DApps to easily integrate Notifi’s communication infrastructure directly through APIs. This is used by DApps that prefer to maintain their native user experience and/or building on mobile, while benefiting from the full suite of services available in the messaging card. Notifi provides not only the infrastructure, but also the security ownership of managing user information, messages, and contact preferences, freeing up developers to focus on building their DApps.
3. Notifi Hub is a centralized way to manage all notifications across all chains, essentially a Web3 inbox. The Hub is a single source of truth to view and manage users’ messages and their contact preferences they set on all subscribed DApps and blockchains. It’s also the home of xMS Chat and offerings key notifications ranging from transaction on any of a users wallets, Whale Watch, NFT and DeFi Signals, security alerts, and more. Notifi Hub started on web and will be live on mobile shortly to further breakdown the Web 3 adoption challenges.
4. XMS Chat stands for Cross-Chain Messaging Service, which allows wallet-to-wallet chat between wallets on any of Notifi’s supported chains, supporting both off-chain and on-chain messages. xMS was designed in collaboration with 19 other projects, who wanted an open-source communication infrastructure that any builder can seamlessly integrate into their product. xMS is currently available on the Notifi Hub and within the Notifi SDK to be integrated as a white-labelled tool by DApps.
5. Notifi Community Manager is a suite of marketing and publishing tools that DApp owners, NFT and content creators can use to communicate one-to-one with their audience across any of Notifi’s supported channels. This product is used widely by Notifi’s DApps partners and “blue chip” project owners as a communication topic users can subscribe to via the Messaging Card or via creator-specific landing pages. When DApps and creators publish their content, the content can also be syndicated across channels like Telegram or Discord.

One of the key advantages of Notifi’s business model is its flywheel effect. As more dApps are added to Notifi’s platform, it begins to create an ecosystem effect, attracting other dApps. This causes more consumers to utilize Notifi platform and use its communication tools to engage with their dApps. This in turn increases the number of dApps on Notifi network and allows the company to expand its communication channels and adoption on multiple chains.

The company’s future revenue model includes a tiered price structure charging Web 3.0 projects based on user message volume per month. The company will have one tier for general communications and another — specific to alerts with financial outcomes, e.g. liquidations. Additionally, the company plans to charge for the Whale Watch feature, where users receive alerts when large investors make moves in the market. Finally, the company plans to charge a percentage of transaction fees on attributable transactions.

We believe that Notifi is close to hitting escape velocity within the Web 3.0 messaging and notifications space. They have started with a freemium model to attract initial projects to integrate with Notifi products, and will continue this network adoption strategy until they solve the cold start problem and reach the tipping point of exponential compounding growth. We believe this is the right approach for ongoing partnerships and exponential growth within the Web 3.0 ecosystem.

Competitive Landscape in Web 3.0 Communications

A close competitor to Notifi is Dialect, a smart messaging protocol that provides dynamic, composable dApp notifications and wallet-to-wallet chat. The company raised $4.1M in equity round from Multicoin, Tiger Global, Jump Crypto, Solana Ventures in April 2022. Dialect is powering communications for Solana projects, such as Saber, Ocean Protocol, Jet Protocol, and others — in total 21 projects.

The major distinction between Dialect and Notifi is Notifi’s multi-chain focus and reach as being able to operate across nine different blockchains today, as well as the rich set of alerts Notifi is able to deliver, using any on-chain or off-chain events. Another area of difference is the emphasis on empowering DApps to have a first class native experience with messaging and notifications vs. funneling them to a dedicated mobile app for communication. Notifi’s emphasis on being a truly white-labeled infrastructure provider allows their DApp partners to fully own their user experience. In our view, given the number of various channels being limited to wallet-to-wallet only restricts users’ options and does not provide as many opportunities for dApps to engage with customers. Furthermore, given the feedback from customers who have tried Dialect, Notifi offers a superior solution via its unified communication platform.

Another major competitor, Push, or previously EPNS, has also made significant traction in the Web 3.0 communications space. With over 17M notifications sent, 60k+ total subscribers, 100 channels and over $1M in grants distributed, Push is making major headway in getting more deeply entrenched with Web 3.0 communities across major verticals. It also enjoys a comfortable runway, having raised a $10M Series A, from Jump Crypto, Tiger Global, ParaFi, Sino Global Capital, Polygon Studios and Harmony Foundation, among others. It’s upcoming roadmap indicates a robust vision for the protocol, including EPNS Protocol & Smart Contracts (Send Notifications), Progressive Decentralized Governance, Front-End products: dApp, Mobile App, Browser extension, PUSH Nodes (Retrieval & Dispatch) and more Technical Documentation. Similar to Notifi, they are focusing on DeFi, DEXs, NFTs and gaming communities and trying to evolve into a communications layer cross chain.

An adjacent indirect competitor, Nansen, unlike Notifi which focuses on DeFi, NFT, DAOs, focuses on institutional investors and enterprises. The company helps crypto investors and professionals surface the signal in blockchain data. They do this by enriching on-chain data with 100M+ wallet labels, and presenting analytics in an easy-to-digest way. Nansen raised $75M in series B from Accel, A16Z, Coinbase Ventures, Mechanism Capital, and others in December 2021. While Nansen is further along in development, its product suite however is geared specifically toward professional investors with their real-time analytics dashboards and dashboard alerts. It will take material time and resources to build a product similar to that of Notifi and pivot into Notifi’s segment. While there are a number of competitors offering Web 3 messaging via wallet-to-wallet messaging, offering wallet push notifications and in-app notifications, they do not offer a channel aggregation communication platform the way Notifi does.

Additionally, some, like WalletConnect and Nansen, focus on institutional use cases, e.g. notifications via wallets for signing transactions and not on other segments. We believe that the combination of Notifi’s product suite and the team’s unique expertise in the messaging and notifications space from decades of product development and growth experience, puts them in an extremely advantaged position to capture a large share of this important Web 3.0 communications market segment.

Closing thoughts

Web 3.0 communications has come a long way but also has a ways to go in providing seamless user experiences across various decentralized ecosystems. The potential to connect Web 2.0 communities and bring mass adoption to Web 3.0 relies on surgical user engagement, coupled with novel communications protocols and an exquisite end to end experience. Web 3.0 needs to feel like a place where users feel alive and empowered to discover new possibilities, instead of perplexed and frustrated. We are well on our way to that reality.

Not financial advice. Views are my own. Shout out to Paul K., Adam S., Leo L. and Cat W. for their review and comments on this piece.

Disclaimer:

Struck Capital Management LLC is registered with the United States Securities and Exchange Commission (“SEC”) as a Registered Investment Adviser (“RIA”). Nothing in this communication should be considered a specific recommendation to buy, sell, or hold a particular security or investment. Past performance of an investment does not guarantee future results. All investments carry risk, including loss of principal.

Sources:

1. Notifi Network — Paul Kim & team
2. Coinbase Web3 Landscape Map
3. Industry insights and expert conversations
4. CoinTelegraph: https://cointelegraph.com/news/less-than-1-of-all-holders-have-90-of-the-voting-power-in-daos-report/amp
5. Nansen, Push (EPNS), Dialect competitive analysis