Have you ever heard of the concepts of the decentralized web, blockchain technologies, and token economics? It all comes together with the idea of Web3.
The term has been hyped up the last couple of months. While skeptics say Web3 is only a marketing buzzword, enthusiasts spot the great, undiscovered potential for data security, scalability, and internet privacy.
Who’s right in this dispute? Will the new iteration of the World Wide Web change the world and successfully combat tech giants, or will the hype fade away? Learn about the foundations, check the examples of real-world Web3 companies, and then decide if you’ll join the army of the questioners or the zealots!
A brief history of the internet – from Web 1.0 to Web3
Long before large technology companies took over the Internet and internet users could hang around on Instagram and other social media platforms, static web pages had been the peak achievement. For that period, we refer to Web 1.0.
Web 1.0 (1990 – 2004) – Read-Only Internet
Web 1.0 is the earliest version of the Internet. It emerged from the Defense Advanced Research Projects Agency (DARPA) and became the global network representing the future of digital communications.
Web 1.0 pages were fairly simple. The pages didn’t contain web forms, and hardly any interactions were possible apart from visiting subsequent hyperlinks.
Do you wonder how it was possible to order a package of goods from your favorite store in the realm of Web 1.0 Internet? Forget about next-day delivery and 24/7 customer support. Most often, you had to send an e-mail order to an address featured on a static website.
Web 2.0 (2004 – now) – Read-Write Internet
A new Internet era emerged with social media platforms. Web evolved to the web-write mode. Users can now share their thoughts and opinions with other people within the virtual world, resulting in new ways of connecting people.
However, the Internet as we know it today, has some significant disadvantages. Big tech companies began to control disproportionate amounts of web traffic. Users could create content, but didn’t own it neither could they benefit from monetization.
Web3 – Read-Write-Own
The concept of Web3 is supposed to solve the underlying problems of Web 2.0.
Therefore Web3 has become more than a term explaining a new iteration of the Internet. It’s the vision of a new, better Internet. The core ideas of Web3 embrace:
- Decentralization – ownership is distributed amongst its builders and users without the involvement of big tech companies.
- Permissionless – everyone has equal access to participate in Web3.
- Native payments – using cryptocurrency for spending and sending money online.
- Trustless – it operates using incentives and economic mechanisms.
Before you dive into details and learn the nuances of various Web3 business models, comprehend basic Web3-related terms first.
Decentralized Internet (or decentralized web)
The terms decentralized Internet and Web3 are virtually inextricable. To understand what Web3 is, you need to grasp the definition of the decentralized web.
According to Samer Hassa from Harvard University:
“[…] Web is suffering the surveillance of U.S. centralized control monopolies. The Decentralized Web is the global effort to re-decentralize the infrastructure, protocols, applications and governance of the Web.“
Dr. Jeremy GIllula from the Electronic Frontier Foundation provides you with an even more accurate explanation:
“The Decentralized Web is like the World Wide Web we have today, filled with amazing, interactive content and information — the only difference is that the underlying architecture is decentralized, so that it becomes much harder for any one entity (whether through malicious censorship or accidental failure) to take down any single Web page, website, or service.”
When you seek information explaining Web3, you can often encounter the term ‘Semantic Web’. However, this concept differs from the decentralized Internet and blockchain technologies which are, in contrast, tied to Web3.
The Semantic Web is the extension of World Wide Web standards. The goal of the Semantic Web is to make Internet data machine-readable. While the Semantic Web can support the development of Web3 projects, you should not refer to it as synonymous with Web3, which is the subject of this article. That’s even harder because some sources refer to the Semantic Web as Web3. Remember that those are two different concepts.
Now that you have an idea what is Web3, it’s time that you learn some real-world examples. Then, find accurately curated examples of companies that can change the (Web3) world.
Founded in 2017, today, with over 2 million collections and +80 million NFTs, it is one of the largest non-fungible tokens marketplaces. It supports multiple blockchains and broad sets of categories. OpenSea connects buyers, sellers, and creators. Over 200 employees back their operations.
Immutable X is an industry-leading NFT minting and trading platform. With the vision of making digital worlds real, the company struggles to open up a full spectrum of possibilities of what digital citizens can create and trade.
Launched in 2014, Ledger is a company that focuses on developing security and infrastructure solutions dedicated to cryptocurrencies and blockchain applications. The company has a unique digital security ecosystem. Some of their essential products feature hardware wallets that assist in securing, buying, and exchanging your crypto and NFTs.
The market is growing, and new opportunities emerge
The current web, as we know it today, has taught us some global standards. Targeted ads, ubiquitous Facebook fake news, and controversial TikTok videos are present at every corner of the current Internet.
The next phase of the World Wide Web is, however, quite distinct, and the services provided by specialized companies are somewhat unconventional. Blockchain technology, smart contracts, and the next generation of the Internet, in general, offer unexplored opportunities.
There are loads of forms of business models available in the Web3 space. For example, Crypto wallets development and security (will they ever replace standard bank accounts?), investment in digital assets (will metaverse virtual lands become more popular than real-world estate?), or completely new ways of money management (DeFi) to name a few.
Those are subjects that no longer interest solely crypto enthusiasts and crypto proponents. Instead, they start reaching a broader audience, and with the support of venture capital firms, entirely new business models emerge and gain importance every day.
Pros and Cons of Web3
Web3, another marketing buzzword for some and a true revolution for others. Web3 has many names, and the coming years will prove which side of the argument was correct. After reading this article, you have the basic notion already, and perhaps you have made your choice.
You will not leave empty handed, however. In the end, get to know the major Pros and Cons of Web3. Ensure you’ve made the right decision in the argument between enthusiasts and opponents of the Web3.
Cons of Web3
- The new version of the Internet is still brand new and immature. Neither Facebook, Twitter, Google, Instagram, or any other great Internet platform you may use today, has been superb since day one. Nor will Web3 projects be perfect at their very early stage of evolution. So expect controversy and loud failures before the ventures get more predictable.
- Metaverse, second life, and non-fungible tokens are fresh concepts. Those who prefer standard, well-known, and thoroughly inspected procedures will not like them regardless of the value and perspectives they bring.
- Truth be told, Web3 projects today still involve exponential risk.
Pros of Web3
- Web3 brings an ocean of new opportunities to a scale that we, as humankind, have probably never known before.
- Blockchain technologies, cryptocurrency, NFTs, virtual land ownership, decentralized autonomous organizations controlled by the unique governance tokens, and fully internet-owned entities are only a few concepts that come to us along with the Web3 revolution. While we are at an early stage of their evolution, ask yourself how much they have changed the world already.
- It’s an excellent opportunity to strengthen user privacy through secure operations without the involvement of a centralized entity.
- While Web3 projects may appear extremely risky, on the flip side, they may also be hugely profitable.