UGX: User Generated Experiences

Key Insights

• AI significantly undercuts software development timelines and costs at the core of the Web2 platforms’ moats.
• Powered by AI, users will be able to generate their own custom experiences both on the content creation and consumption side, resulting in a new user-generated experience paradigm that supersedes the current user-generated content paradigm.
• In order for users to generate apps that are both unique and integrated into shared data, the data layer needs to be open and composable, favoring crypto primitives.
• Decentralized social is perhaps the most benefited consumer sector in crypto as it provides the data primitives needed for users to build interoperable experiences.

Paradigms of consumer behavior rise and fall as technology dramatically changes the cost of production and distribution, upending the assumptions baked into the previous paradigm. Going from publication-dominated Web1 to Web2, user-generated content (UGC) became the vital ingredient that enabled tech platforms to steal value from centralized publications. Web2 platforms allowed anyone to publish text, photos, and video, which undercut the content production cost of incumbent publishers and siphoned away user attention which is equivalent to value in an ad-driven business.

The core invention that gave UGC scale was standardizing features and the user interface (UI) into a continuous feed. This allowed platforms only to spend engineering resources on a single app design and push user-specific customization to the algorithm layer, which populated each individual’s feed with tailored content.