What Zuckerberg's money can't buy

Welcome back to Chain Reaction.

Last week, we looked at Solana's smartphone and the post-Apple tech industry. This week, we're looking at a web3 without Big Tech.

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no trillionaires allowed

Unlike other moonshot tech categories, it's become increasingly clear that there isn't a huge whitespace open for Big Tech in defining the future for crypto.

This week, Meta announced it will be shutting down its Novi crypto payments wallets in September. This pilot, which was only available in a couple geographies, was pretty much the last hurrah of the company's broadly ambitious Diem stablecoin plans and leaves the company without a clear path forward for a crypto play that expands beyond its current networks.

This failure was no surprise, Meta has been a punching bag for regulators over the years and that has played out most aggressively in the gutting of their crypto ambitions -- something that eventually led to the selloff of its Diem assets and the exodus of its top talent. Meta isn't alone, plenty of tech's biggest $1T+ market cap companies (or at least those that were up there a few months ago) have not made a blockchain play despite ideal positioning. For some companies, this might be ideological, but for others it's clear that the regulatory risks are too present for them to endanger their other revenue streams.

Comparing crypto to another moonshot like AR/VR, it's clear the government generally has no idea how to regulate internet-native social networking companies while they have a pretty solid idea of what they're doing when it comes to throwing financial instruments and vehicles into the right buckets. Not having this diversified tech market support means that the lows might continue to sink pretty dang low for crypto hopes pinned on web3 ambitions. AR/VR has been in a dry spell for years but Meta has been spending the industry through the drought without a clear focus on present revenues, this isn't an investment that GAFAM is going to be dropping in web3 anytime soon.