Jack Dorsey, Twitter founder and Block CEO, tweeted that he believes VC funds, not users, are the real owners of web3 technology, and that it will not fulfill its promise of decentralizing power.

Quick refresher: Web3 is the idea that next generation internet companies will be decentralized and built on-top of trusted blockchains. Unlike existing technology that’s owned and operated by centralized teams (i.e. Facebook, Twitter, etc.), future web3 apps will be owned and controlled by their users.

• A good example of this is Compound, the decentralized finance platform, where each corporate decision is voted on by the holders of the Compound token — see it in action.

Dorsey disagrees: The self-proclaimed Bitcoin maximalist cited the billions of dollars venture capitalists have allocated to web3 companies and argues that their disproportionate ownership gives them outsized control over the platforms, making them no different than traditional tech companies.

This drove web3 and crypto Twitter crazy. Here were some of the rebuttals:

• Since decentralized applications are completely public, users could fork (i.e take the tech and start a new project with the same mission) in the event that a protocol became too centralized.
  
• Any sign of centralization of a protocol would undermine that protocol’s purpose and trigger a backlash, and possibly a fork, from other users. So it’s in the best interest of the protocols to avoid decentralization.

Why it matters: Dorsey makes a valid point that the web3 industry is going to have to contend with, but it remains to be seen whether he is right or not. The question of whether decentralized platforms can fulfill their promise is going to be a defining issue in the space next year.