What Is Web3? The Confusing Term, Explained

“The vast majority of what I’m seeing is smaller-dollar things that are much more around communities,” he notes, like Sound.xyz. Whereas scale has been a key measure of a Web2 company, engagement is a better indicator of what might succeed in Web3. Though there is a lot that may come with Web3, there are some overall themes that are already emerging. The pull away from “big data” with an emphasis on giving the user more freedom and security is already happening.

An example of people using blockchain includes registering digital assets and tokens , which allow people to transfer digital goods seamlessly without needing to know the other party. Personal identity isn’t revealed unless users decide to share their real identity by tying their blockchain wallets (think of this as your Web 3.0 ID) to their personal information. You could build a similar network without crypto by going door-to-door, trying to convince people to share slivers of their internet bandwidth with nearby devices. Or, if you were a big telecom company like Verizon or AT&T, you could spend billions of dollars to build such a network yourself. In order to achieve gains, you’ll probably need to step outside your comfort zone . One of the consequences of web3 and a new approach to ownership is that customers suddenly have greater control over things like loyalty points and NFT assets.

It’s rife with speculation.

The WWW initialism used to preface a web address and was one of the first characters typed into a web browser when searching for a specific resource online. Internet pioneer Tim Berners-Lee is credited with coining the term World Wide Web to refer to the global web of information and resources interconnected through hypertext links. Web 2.0 and Web 3.0 refer to successive iterations of the web, compared with the original Web 1.0 of the 1990s and early 2000s. Web 2.0 is the current version of the internet with which we are all familiar.

Some popular Web3 platforms include OpenSea, Coinbase, Ledger and MetaMask. Many of these networks and platforms sell NFTs or cryptocurrencies like Bitcoin. “Although it’s hard to pinpoint, I expect the metaverse will use blockchains to keep track of digital asset storage,” says Huang. One potential use is that creators in the metaverse may be able to register their digital assets, like sound, music, immersive experiences and games, in a safe and transparent way. Some skeptics simply believe that web3 doesn’t make sense from a technical perspective. To make web3 services perform as well as consumers demand, they argue, you have to build centralized services on top of them — which would defeat the whole purpose.

Brave browser would also utilize blockchain for interrupting unwanted ads as well as trackers. Most important of all, Brave browser also enables the flexibility for monetization of user data in return for Brave tokens. Web 3.0 apps are easy to access and use with considerable difficulties for compromising their security.

IP | Data | Privacy | Ethics | Harvard CopyrightX. I share views on innovation, creativity & how technology is making this world a more fun place to live in. Because the distributed architecture of Web 3.0 negates the need for centralized authorities, security will be enhanced. Potential attack surfaces will be smaller and without a centralized authority, there will no longer be a single point of failure . But many people who found wealth during the pandemic by investing in cryptocurrencies are looking around for something to plunge cash into beyond NFTs of “bored apes” who are members of a cartoon “yacht club.” “The Faustian bargain is that the same reasons that it’s exciting that there’s nothing impeding people to build whatever community they want, I can’t stop someone from building something that’s hellacious,” he said.

Blockchain fundamentals

Tokens also introduce a native payment layer that is completely borderless and frictionless. Companies like Stripe and Paypal have created billions of dollars of value in enabling electronic payments. There are even websites dedicated to keeping up with these breaches and telling you when your data has been compromised. When a developer or company launches a popular app, the user experience is often very slick as the app continues rising in popularity. This is the reason they are able to gain traction quickly in the first place.

• This article is intended to be used and must be used for informational purposes only.
• The totality of these efforts is called “Web3.” The moniker is a convenient shorthand for the project of rewiring how the web works, using blockchain to change how information is stored, shared, and owned.
• While companies such as Microsoft, Overstock, and PayPal have accepted cryptocurrencies for years, NFTs — which have recently exploded in popularity — are the primary way brands are now experimenting with Web3.
• The code on the chain indicating your ownership includes an address, pointing to where the image is stored.

The number of active developers working on Web3 code nearly doubled in 2021, to roughly 18,000 — not huge, considering global numbers, but notable nonetheless. Perhaps most significantly, Web3 projects have become part of the zeitgeist, and the buzz is undeniable. Amidst all the demands on our attention, many of us didn’t notice cryptocurrencies slowly seeping into the mainstream. What was first a curiosity and then a speculative niche has become big business. AI could work as your own personal butler, creating personalized experiences for you using the data you control. You may also be able to build custom games and environments using AI.

Decentralized Finance (DeFi)

The metaverse is essentially a virtual world — and can be thought of as a 3D version of the Internet and digital representation of the real world. Users can navigate either with computers, phones or VR/AR headsets, providing a deeply immersive experience that will increasingly blur the edges of reality. The year 2022 has seen a dramatic https://cryptolisting.org/ rise in the interest in Web3, with several companies pivoting towards it and venture capital giants like a16z investing millions into its builders. As Web 3.0 becomes the next major era in computing, IT and business leaders should start thinking about structuring their networks and operations to leverage the potential of Web 3.0.

Though some existing technologies and platforms are considered by some to constitute a part of Web3, many anticipated elements of Web3 are still theoretical, requiring advances in artificial intelligence or virtual reality, for example. For example, blockchain technology is often touted by its proponents as a way for users to manage their own groups, data, and transactions without the need for outside regulation. Many objects in the metaverse may also be crypto tokens, if the web3 crowd has its way. Your metaverse house might come with governance tokens or qualify you to join a neighborhood DAO. The mortgage on that house might even be packaged into a mortgage-backed security token and sold on a decentralized exchange. Internet behemoths like Facebook and Twitter are essentially autocracies.

Yet knocking out Facebook, Twitter or Google completely is not likely on the horizon, according to technology scholars. Just as cryptocurrency blockchains are built to prevent “double spending,” a blockchain-centric internet would, in theory, make it harder to manipulate and control data. Since data would be decentralized, no gatekeeper would have control of it, meaning they couldn’t bar anyone’s access to the internet. Even if you’re not into blockchain technology like Bitcoin and NFTs, you’ve probably heard about Web3 (or Web 3.0). Your tech-savvy friends might be telling you it’s the future, but the concept is a bit confusing.

But Web3 is driving new conversations — and generating lots of new money, particularly from crypto investors. There’s a trilemma with blockchain technology that is acting as a barrier to the adoption of Web3, coined the Scalability Trilemma. A lot of people have trouble wrapping their heads around concepts like crypto and NFTs as it is (which is why articles like this exist!). Even if the ideal of a decentralized “Web 3.0” never happens, billions of dollars are going into the technologies related to it. All their transaction records, rules, and so on are stored on blockchain. In web3, Identity also works much differently than what we are used to today.

One of the most common visions is building tokens into everything online. Protocols and tools like Ceramic and IDX already allow developers to build self-sovereign identity into their applications to replace traditional authentication and identity layers. The Ethereum foundation also what is assetstream has a working RFP for defining a specification for “Sign in with Ethereum” which would help provide a more streamlined and documented way to do this going forward. This is also a good thread that outlines some of the ways that this would enhance traditional authentication flows.

Over the past 15 to 20 years, the bland webpages of Web 1.0 have been completely replaced by Web 2.0’s interactivity, social connectivity, and user-generated content. Web 2.0 makes it possible for user-generated content to be viewed by millions of people around the world virtually in an instant; this unparalleled reach has led to an explosion of this type of content in recent years. Web3 makes the proliferation of cooperative governance structures for once-centralized products possible. Anything at all can be tokenized, whether it’s a meme, a piece of art, a person’s social media output or tickets to Gary Vee’s conferences.

Web 1.0 was mainly static websites owned by companies, and there was close to zero interaction between users – individuals seldom produced content – leading to it being known as the read-only web. Once the rules for a financial product are written in code (a ‘smart contract’) and deployed to the blockchain, DeFi dapps remove intermediaries and run themselves with little to no human intervention. That means financial institutions are removed from the equation in favor of peer-to-peer transactions and automation.

A decentralized future

The decentralized video streaming platform does not control the videos which appear in user feeds. More specifically, the Everledger app helps in tracking diamonds, gold, wine and other valuable assets. It helps in tracking the use of an item throughout its journey in the global supply chain. Customers can scan the Everledger sticker to ensure that they purchase authentic products.

Further reading

Then there’s a third group who will think you’re referring to the Internet of Things or the Metaverse. This is the heart of the argument for a new version of the internet, coined Web3. This new model of the web would be decentralized and powered by blockchain technology. Web3 is still largely theoretical and has a pretty steep learning curve. Currently, anyone who wants in has to educate themselves on blockchain and cryptocurrency technologies. That’s a step not everyone wants to take just to use another version of what they already have, especially if they can use apps like private browsers to get around privacy concerns.

This means people can become participants and shareholders, not just customers or products. The difference between Web 2.0 and 3.0 is that Web 3.0 is more focused on the use of technologies like machine learning and AI to provide relevant content for each user instead of just the content other end users have provided. Web 2.0 essentially enables users to contribute and sometimes collaborate on site content, while Web 3.0 will most likely turn these jobs over to the semantic web and AI technologies.