Onchain or Nowhere: Data Composability

September 14, 2023
Station Network

Crypto rails offer unprecedented access to cross-app, globally composable datasets. The promise of open, permissionless systems is a digital fabric anyone can tap into to weave novel experiences without starting from scratch.

Where Interoperability enables data or assets to be freely moved from one system to another by a user or developer, composability is the ability to combine systems together to create altogether new effects.

As part of the first OnChainOrNowhere web3 salon—hosted by Station, Privy and Turnkey — we met to talk about data composability’s role in shaping the future of the web.

Here are some lessons we drew from the conversation.

Focus on concrete data composability unlocks when building

It’s easy to tout composability as a value but it’s worth focusing on its concrete unlocks when building. Concretely, you can think of data composability benefits through two lenses:

  • Data coming in – data composability enables you to break you out of a cold start problem by effectively seeding your dataset or userset to make your product compelling from day one.
  • Data going out – Using open standards, you can make building atop your own systems easier to create more utility for your existing user base.

A few composability stories are worth thinking about here, for instance:

  • Blur’s mystery boxes leveraged on-chain data to kickstart their community – composability can be used to bootstrap a user base using public data.
  • StreamETH’s event-based interfaces can be made immediately useful for ephemeral events – composability provides contextual data for short-lived product experiences.

Beware a focus on tokenization

Tokenization has pushed builders toward limited forms of composability. Because of its intrinsically financial nature, tokenization in monetary systems has pushed builders toward certain models of using composable data. Namely, the draw to capturing economic value early has pushed developers to try to build their own moats within open data ecosystems rather than build highly interactive systems.

Highly composable products and datasets will emerge as crypto moves beyond financialization as its core value and toward a greater focus on end-user value and applications.

Wallets are a good place to look to read the market’s take on composability

Wallets today reflect the core of where composable data is in web3: with monetary systems (think tokens). As they branch into NFTs and beyond this identity, wallets give us insight into what data is increasingly leaking out of single apps into the domain of composable user data more generally.

Look for signs of composability beyond simple tokens by observing new wallet releases such as recent ones by Worldcoin or Uniswap.

We must focus on usability over abstraction resilience today

Backwards compatibility will slow development pace to a crawl. Composable datasets should be long-lived and supported over time. However, the need for backwards compatibility can slow down development cycle and prevent greater adoption of systems over time. Open (and updatable) schemas should make it simple for users to export and reuse data, but systems developers should focus on building useful systems today, moving quickly to help the ecosystem expand rather than focusing on building fully generalizable abstractions.

Privacy questions abound, reasoning in terms of users will help us devise better systems.

Composable data brings with it a slew of privacy questions around what data should be open and publicly accessible and what should be closed. The web3 space would benefit from reasoning in terms of easy-to-understand defaults (public or private profiles eg) rather than granular permissioning systems. Data permissioning must be built with the specific application and end-user in mind.

Composability is at the heart of what makes web3 a unique space to build in. It will enable the future of online coordination and unlock unique product experiences on the web. But in order to meet their potential, composable products must be grounded in concrete user needs. Crypto can be where systems theory meets practical applications. Examples of greater composability are emerging in the space. By focusing on the best tools to serve our users, rather than trying to stake out and own a protocol moat, we can push the space forward, together.

As we unpacked the potential of composability and interoperability, we discovered the transformative potential of this feature — from breaking the cold start problem to enabling user-focused utility through open standards. As we peeked into the future through the lens of evolving wallets, we saw a glimpse of what's to come. The journey ahead promises a fine balance between usability and abstraction resilience and calls for a user-centric focus. As we navigate this exciting landscape where systems theory meets practical applications, the ethos is clear: serve users and collaborate for progress rather than isolating into protocol moats.

OnchainorNowhere is a collective of cutting-edge product builders exploring new experiences unlocked by onchain mechanisms and infrastructure. Reach out to us if you wish to be part of these conversations, whether you agree or disagree, or have something to add.

The next salon awaits.

Station Network
A future publication

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