Jack Dorsey on Web3: A Bitcoin Maximalist's Vision for a Decentralized Future
Explore Jack Dorsey's passionate, and often controversial, views on Web3. Learn why the Twitter and Block founder is a Bitcoin maximalist and a sharp critic of what he calls venture-capitalist-owned 'Web3'.
Jack Dorsey: The Bitcoin Evangelist and Web3 Skeptic
Jack Dorsey, the co-founder of Twitter and founder of Block (formerly Square), is one of the most influential and vocal figures at the intersection of technology and decentralization. However, his perspective is unique and often contrarian. Unlike many Silicon Valley VCs and founders who embrace the broad ecosystem of "Web3"—including Ethereum, NFTs, and DeFi—Dorsey is a staunch Bitcoin maximalist. He believes that Bitcoin is the only true candidate for the internet's native currency and that the current iteration of "Web3" is a dangerous, venture-capitalist-controlled distraction.
His vision is not for a lack of interest in decentralization; on the contrary, he is arguably one of its most passionate advocates. His focus, however, is laser-sharp. He sees Bitcoin as a protocol for decentralizing money and "Web5," a project from his TBD division at Block, as the protocol for decentralizing data and identity.
"Web3" vs. "Web5": A Battle of Philosophies
In December 2021, Dorsey famously tweeted, "You don’t own 'web3.' The VCs and their LPs do. It will never escape their incentives. It’s ultimately a centralized entity with a different label." This tweet ignited a firestorm of debate. Dorsey's core argument is that the Web3 ecosystem, largely built on Ethereum and fueled by VC funding rounds for new tokens, is simply recreating the power structures of Web2. In his view, venture capital firms invest in these projects, receive large token allocations, and then use their influence and marketing power to pump their investments, ultimately leaving retail users holding the bag.
His proposed alternative is "Web5: The Decentralized Web Platform." Announced in June 2022 by Block's TBD division, Web5 is an ambitious project that aims to give individuals true ownership over their data and identity. It is built on top of Bitcoin, using it as its foundational trust layer, but it does not have a new token.
The core components of Web5 are:
- Decentralized Identifiers (DIDs): Self-owned digital identities that are not reliant on any corporation or third party.
- Decentralized Web Nodes (DWNs): Personal datastores that hold an individual's public and encrypted data. Users can control which apps and services have access to their data.
- Bitcoin as the Trust Anchor: The Bitcoin blockchain is used to anchor the DIDs, providing a secure and decentralized public key infrastructure without creating a new token or consensus system.
The goal of Web5 is to solve the identity problem that Dorsey believes Web3 has failed to address. In his eyes, Web3 applications still rely on users connecting with wallets that are largely disconnected from their real-world identity, and the data is still stored on centralized servers or complex, inefficient systems like IPFS.
Bitcoin: The Only True Decentralized Money
Dorsey's maximalism is rooted in his belief in Bitcoin's "immaculate conception." He argues that because Bitcoin was created by a pseudonymous founder (Satoshi Nakamoto) who has since disappeared, and because it had no pre-mine or venture capital funding, it is the only truly decentralized digital asset. All other tokens, he contends, were created by known founders and funded by VCs, giving them a centralized point of control and failure.
His company, Block, has fully embraced this vision:
- Balance Sheet: Block was one of the first publicly traded companies to add Bitcoin to its corporate treasury.
- Cash App: Allows millions of users to easily buy, sell, and hold Bitcoin.
- Hardware Wallet: Block is developing a new, user-friendly hardware wallet to make self-custody of Bitcoin more accessible.
- Bitcoin Mining: The company has announced initiatives to build a more open and decentralized Bitcoin mining system.
Bluesky and Decentralized Social Media
Beyond finance, Dorsey's passion for decentralization extends to social media. During his time as CEO of Twitter, he funded and spun out Bluesky, an independent project tasked with creating a decentralized social media protocol.
The protocol, called the AT Protocol, aims to create a world where users are not locked into a single platform. In this vision, you could move your identity, your followers, and your content from one social media app to another, just as you can move your emails from Gmail to Outlook. This concept of "account portability" is a direct challenge to the walled-garden model of today's social media giants, including the one he helped create.
While Bluesky is a separate entity from Block and is not directly tied to Bitcoin, it shares the same philosophical underpinning: to return control and ownership to the individual.
Conclusion: A Principled, if Controversial, Vision
Jack Dorsey's stance on Web3 is both principled and polarizing. His critiques of the VC-dominated Web3 ecosystem resonate with many who are disillusioned with the space's speculative excesses and centralization theater. His focus on Bitcoin as a singular, provably decentralized protocol provides a clear, if narrow, vision for the future of money.
At the same time, his dismissal of the entire ecosystem building on Ethereum and other smart contract platforms strikes many as overly simplistic. The innovations in DeFi, NFTs, and DAOs, while imperfect, represent some of the most vibrant and creative areas of Web3.
Ultimately, Dorsey is not against a decentralized web; he is a purist fighting for a specific version of it. He believes the "how" matters just as much as the "what," and for him, the only correct "how" is through open, decentralized protocols like Bitcoin, not through VC-backed token projects with centralized leadership. His work on Bitcoin at Block and his support for Bluesky represent a determined effort to build the infrastructure for what he sees as a more authentic and empowering digital future.
Frequently Asked Questions (FAQ)
Q1: Why does Jack Dorsey dislike Ethereum?
Dorsey has criticized Ethereum for what he perceives as its centralization. He points to the fact that it was created by known founders, had a pre-mine (tokens created and distributed before the public launch), and has a foundation that exerts significant influence over its development. He sees it as a "single point of failure" and therefore not a suitable foundation for a truly decentralized internet.
Q2: What is the relationship between Jack Dorsey and Elon Musk?
Dorsey and Musk share a mutual respect and a common interest in promoting free speech and open protocols. Dorsey was a vocal supporter of Musk's acquisition of Twitter (now X), believing that taking the company private was the best way to move it towards a more open and protocol-based system. Both are also prominent supporters of Bitcoin.
Q3: Is "Web5" a real project?
Yes, Web5 is a real, open-source project being developed by TBD, a subsidiary of Dorsey's company, Block. It is not a product itself, but rather a set of standards and protocols that developers can use to build decentralized applications. Its goal is to provide decentralized identity and data storage solutions built on top of the Bitcoin blockchain.
Q4: Does Web5 have a token to invest in?
No. A core principle of Web5 is that it is built on Bitcoin and does not introduce a new token. This is a deliberate choice by Dorsey to avoid the VC-driven tokenomics that he criticizes in the "Web3" space.
Q5: What is Bluesky and how is it related to Twitter (X)?
Bluesky is an independent company and a project that was initially incubated within Twitter when Dorsey was CEO. Its goal is to create a decentralized social networking protocol (the AT Protocol). It is not owned by X (formerly Twitter). The idea is to create a future where multiple social media applications, including a potential future version of X, could be built on top of this shared, open protocol, allowing for user choice and account portability.
