It’s often the top priority for VCs and angel investors that businesses comply with relevant regulations, not decentralization, for growth.

In a series of tweets posted on Tuesday, Jack Dorsey, the co-founder and former CEO of Twitter, as well as the founder and CEO of Square (now Block), voiced his criticism over the direction of Web 3.0 development. Elon Musk, the CEO of Tesla, joined Dorsey in the mockery. On an unrelated note, the same day, Dorsey replied, “Bitcoin will” when asked if crypto will replace the dollar.

Within context, Web 3.0 is a decentralized version of the virtual world that will, in part, feature public blockchains, metaverse technology, nonfungible tokens and decentralized finance free from the grasp of centralized power sources, such as corporate servers. 

However, Dorsey took aim at the fact that venture capital firms, or VCs, and limited partnerships, also known as LPs, frequently fund Web 3.0 projects in direct competition with decentralized alternatives such as initial coin offerings. By owning a controlling stake, VCs and LPs can then pressure blockchain co-founders to comply with centralized regulations, such as collecting Know Your Customer (KYC) data,  that conflict with their core crypto philosophy.