What Is Web 3 and Why Is Everyone Talking About It?

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Web 3 – often known as “Web3″ or “Web 3.0″ – is a term you may of heard thrown around a lot lately. It simply refers to the next iteration of the internet that promotes decentralized protocols and aims to reduce dependency on large tech companies like Youtube, Netflix and Amazon. But what is it, and why is it on everyone’s minds?

What is Web 3?

To understand Web 3, it makes sense to understand what came before. The first version of the Internet – known as Web 1 – arrived in the late 1990s and comprised a collection of links and homepages. Websites weren’t particularly interactive. You couldn’t do much apart from read things and publish basic content for others to read.

Brian Brooks, the CEO of Bitfury, put it smartly in a speech to the U.S. Congress in December 2021: “If people remember their original AOL account, it was an ability to look in a curated ‘walled garden’ at a set of content that was not interactive, but was presented to you on AOL, the way that Time Magazine used to show you the articles they wanted you to see inside of their magazine, just you could see it on a screen.”

Web 2 got here subsequent. Some individuals name this the “read/write” model of the web, in reference to a pc code that permits you to each open and edit recordsdata quite than simply view them. This model of the Internet allowed individuals to not solely eat content material, however create their very own and publish it on blogs like Tumblr, Internet boards and marketplaces like Craigslist. Later, the emergence of social media platforms together with Facebook, Twitter and Instagram took content material sharing to new heights.

After some time, most people grew to become cognizant about the way in which their private knowledge was being harvested by tech giants and used to create tailor-made commercials and advertising and marketing campaigns. Facebook, particularly, has had the highlight shone on it innumerable instances for breaching knowledge privateness legal guidelines and was hit with a $5 billion wonderful in 2019 – the largest penalty ever issued by the Federal Trade Commission (FTC.)

Although Web 2 has introduced the world wonderful free providers, lots of people have grown uninterested in the brand new “walled gardens” these big tech firms have created and need to have extra management over their knowledge and content material. This is the place Web 3 is available in.

Web 3 might be understood because the “read/write/own” part of the Internet. Rather than simply utilizing free tech platforms in change for our knowledge, customers can take part within the governance and operation of the protocols themselves. This means individuals can change into members and shareholders, not simply prospects or merchandise.

In Web 3, these shares are known as tokens or cryptocurrencies, and they symbolize possession of decentralized networks generally known as blockchains. If you maintain sufficient of those tokens, you will have a say over the community. Holders of governance tokens can spend their property to vote on the way forward for, say, a decentralized lending protocol.

Again, right here’s Brooks: “The real message here is that what happens on the decentralized internet is decided by the investors versus what happens on the main internet is decided by Twitter, Facebook, Google and a small number of other companies.”

What are you able to do on Web 3?

Web 3 makes the proliferation of cooperative governance buildings for once-centralized merchandise doable. Anything in any respect might be tokenized, whether or not it’s a meme, a bit of artwork, an individual’s social media output or tickets to Gary Vee’s conferences.

An excellent instance of the paradigm shift is within the gaming business. Gamers grumble endlessly concerning the bugs that builders depart of their favourite online game, or how the most recent patch has upset the steadiness of their favourite weapon. With Web 3, players can put money into the sport itself and vote on how issues must be run. Large Web 2 firms, like Meta and Ubisoft, are creating digital worlds powered partially by Web 3. Non-fungible tokens (NFT) can even play an enormous position in reshaping the gaming business by permitting gamers to change into the immutable house owners of the objects they accrue.

Criticisms of Web 3

The fundamental criticism of Web 3 know-how is that it falls in need of its beliefs. Ownership over blockchain networks will not be equally distributed however concentrated within the palms of early adopters and enterprise capitalists. A public spat just lately erupted on Twitter between Block Inc. CEO Jack Dorsey’ and varied enterprise capitalists over Web 3, bringing this debate to the forefront.

Read More: What Jack Dorsey’s Beef With ‘Web 3′ is Really About

At the heart of the critiques is the idea of “decentralization theater,” where blockchain projects are decentralized in name but not in substance. Private blockchains, VC-backed investments, or decentralized finance (DeFi) protocols where just a few people hold the keys to hundreds of millions of dollars are all examples of decentralization theater.

And despite the supposedly leaderless community of protocols, there are clear figureheads. Izabella Kaminska, the outgoing editor of the FT blog Alphaville, pointed to the huge amount of power that Vitalik Buterin, the co-founder of Ethereum, continues to have over the network, even though he’s now not concerned in its improvement:

(*3*) Kaminska instructed The Crypto Syllabus.

Things aren’t significantly better inside decentralized finance protocols. They’re rife with voter absenteeism, typically depend on centralized infrastructure and the barrier to entry in creating them remains to be excessive, provided that creating blockchains appears to be arcane magic reserved for less than essentially the most extremely specialised engineers.

But regardless of its issues, Web 3 has a number of potential. Whether it’s too idealistic to place into follow can be one thing that on a regular basis customers will uncover over the following decade.

Read More: Web 3 and the Metaverse Are Not the Same