Why Your Web3 Product Is a Solution in Search of a Problem

The Problem: On-chain order books were slow, expensive, and impossible for small tokens. The Solution: A constant-product formula (x*y=k) that provides instant, permissionless liquidity for any asset pair.

• Eliminated the need for centralized market makers and order books.
• Created the foundational primitive for $2B+ in daily DEX volume.

The Problem: Smart contracts are blind; they couldn't access real-world data (price feeds, sports scores, weather) without a centralized, corruptible point of failure. The Solution: A decentralized oracle network that aggregates data from hundreds of independent nodes.

• Secures $80B+ in DeFi TVL with tamper-proof data feeds.
• Became critical infrastructure, not just another app.

The Problem: Ethereum was too expensive and slow for mass adoption, but security was non-negotiable. The Solution: Execute transactions off-chain (L2), then post compressed proofs or data back to Ethereum L1 for finality.

• Reduced user fees by 10-100x compared to L1.
• Captured ~90% of L2 market share by inheriting Ethereum's security.

The Problem: Interacting with dApps required running a full node or using clunky, insecure browser extensions. The Solution: A simple, non-custodial browser extension that manages keys and signs transactions.

• Onboarded 100M+ users by abstracting away private key management.
• Became the default identity and transaction layer for Ethereum.

The Problem: Staking ETH on Ethereum locked capital and killed liquidity, creating a massive opportunity cost for validators. The Solution: Issue a liquid staking token (stETH) that represents staked ETH and earns yield, tradable in DeFi.

• Unlocked $30B+ in otherwise idle capital.
• Dominated with ~30% of all staked ETH by solving a clear financial inefficiency.

The Problem: Tooling was built for a theoretical 'on-chain governance utopia' that doesn't exist. Most decisions are still made off-chain. The Reality: Products like complex multi-sig managers and voting platforms became solutions in search of a problem.

• Low engagement: <5% voter turnout is common, even with token incentives.
• High overhead: Added process without improving real-world coordination.

Assuming blockchain is the default solution creates products with negative user value. The friction of wallets, gas, and volatility must be justified by a unique, superior outcome.

• Key Test: Does your user need self-custody or permissionlessness? If not, a database is cheaper.
• Key Metric: Your on-chain activity should be >10x cheaper or enable something impossible off-chain.

Inflationary token rewards create a ponzinomic facade of growth, masking a lack of organic utility. Real protocol revenue stems from fees users willingly pay for a service.

• Key Test: Does your protocol generate sustainable fee revenue after emissions end?
• Key Metric: Protocol Revenue-to-Inflation Ratio. A ratio <1 is a red flag.

UniswapX uses an intent-based, off-chain auction system to improve pricing and reduce gas costs. It didn't just iterate on the AMM; it re-architected the trade flow around user intent.

• Key Test: Are you optimizing an existing blockchain primitive, or are you solving the user's core intent in a novel way?
• Key Reference: See similar intent-based architectures in CowSwap and Across.

Building for speculators (degens, farmers) is not the same as building for end-users. Speculator demand is ephemeral and mercenary. Sustainable products solve problems for non-crypto-native users.

• Key Test: Can you describe your ideal user without using the words 'crypto', 'DeFi', or 'NFT'?
• Key Metric: Monthly Active Users (MAU) that are not just fee-harvesting or staking.