The tech world is full of ambiguous acronyms, from the “cloud” to the “internet of things.” While Web3 appears similar on the surface, the term has a real meaning that could reshape the Internet over the coming years. It refers to a new kind of “decentralized” Internet that combines today’s Internet with a host of security, privacy, and other benefits.
The Web3 era is comparable to PCs in the 1970s – the early stage technology was there, but few could predict that 80%+ of the workforce would use them daily in just 20 to 30 years. The principles that underlie Web3 could pave the way for everything from ultra-secure online voting that reshapes democracy to employees that work entirely in the metaverse.
Let’s take a closer look at the origins of Web3, examples in today’s world, and how it could reshape the future of the Internet.
Web3 combines today’s Internet with security, privacy, and other benefits that could reshape the web as we know it.
What is Web3?
The Internet has evolved over the years in at least three major phases. Until the early 2000s, Web 1.0 featured a handful of prominent websites and search engines along with thousands of personal web pages. Then, the rise of Facebook ushered in a new era of Web 2.0, characterized by social media giants operating walled gardens.
Web 3.0, or Web3, aims to bring the Internet back to its roots. Using decentralization, the next iteration of the Internet aims to break down walled gardens and put the power back into the hands of users. For example, content owners can deliver content to users without intermediaries, and assets can readily move across platforms.
Web3 has several core features:
- Security – Web3 users typically authenticate with a private key rather than a username and password. As a result, you don’t need to trust a third-party authority to store and verify your credentials.
- Resilience – Web3 leverages a distributed network of nodes rather than a handful of centralized servers. In most cases, these nodes are independently owned and geographically dispersed.
- Private – Web3 users interact with independent Web3 nodes behind closed doors, meaning you’re in complete control of your data. No single organization can censor information on a central server.
- Open – Web3’s permissionless and transparent approach means that anyone can access information regardless of location, nationality, age, gender, or other factors.
While Web3 technologies offer many benefits, there are some trade-offs to consider. For example, blockchain transactions are inherently irreversible, making fraudulent transactions a significant problem. And the private nature of Web3 technologies could make it impossible to censor data that shouldn’t be available to the public.
Several Web3 technologies are already available today, but they only scratch the surface of what’s possible over the coming years. As blockchain technology, cryptocurrencies, browsers, and other building blocks of the Web3 ecosystem mature, the capabilities of these platforms and the number of options available to consumers will increase.
A few examples of today’s Web3 technologies include:
- Unstoppable Domains – Unstoppable Domains offers NFT domains stored on the blockchain that never expire. Unlike conventional domain names that require a subscription, NFT domains can serve as a universal username, website URL, or wallet payment address.
- IPFS – IPFS (or the Interplanetary File System) is a peer-to-peer hypermedia protocol that aims to surpass HTTP and form the decentralized core of Web3. Rather than using a centralized server, IPFS hosts files on a distributed network of nodes.
- Aragon – Aragon is a platform for building decentralized autonomous organizations (DAOs) with open source infrastructure and governance plugins. Unlike a traditional corporation, DAOs delegate decisions and distribute profits to their members.
In addition to these Web3 concepts, the metaverse is also starting to find its footing in 2022. NVIDIA’s Omniverse is capable of creating simulations to train robots and autonomous vehicles, while Facebook’s Oculus and Google Glass are merging physical and virtual worlds. These trends could soon usher in a new digital era.
What’s Next for Web3?
The evolution of Web3 hinges on the development of new technologies. For instance, the initial version of Unstoppable Domains had extremely high gas fees, with a single domain registration costing upwards of $200. Fortunately, the rise of the Polygon blockchain enabled the company to lower these fees to zero, allowing anyone to mint NFT domains.
Some trends to watch over the coming years include:
- Metaverse – Web3 technologies could play a central role in the metaverse. In particular, NFTs could enable virtual assets to traverse metaverse platforms, while play-to-earn (P2E) games could make it possible to generate an income in virtual worlds.
- Browsers – Brave, Opera, and a handful of other niche browsers support Web3 protocols like Tor or IPFS, but the adoption of these protocols by Chrome, Firefox, and Safari could go a long way in encouraging the adoption of these technologies.
- Stablecoins – Facebook’s ill-fated “diem” stablecoin could be a stepping stone to greater success. By bringing banks into the fold, future projects could create stablecoins backed by tangible assets, enabling frictionless transactions without intermediaries.
- NFTs – NFTs could enable micro-transactions and asset ownership on an entirely new level. For example, anyone could own a piece of intellectual property through NFTs (e.g., a single TV episode), creating novel streams of income.
Anyone interested in the future of Web3 can follow the roadmaps set forth by the Web3 Foundation (W3F). Backed by major players in the industry, the organization has laid out a roadmap to bringing Web3 to market and provides funding for projects developing many of the core components and infrastructure necessary for success.
Meanwhile, advances in GPU-accelerated computing, deep learning, physics-informed neutral networks, and AI supercomputers could open the door to powerful simulations, like NVIDIA’s Earth-2, enabling even more immersive metaverse experiences and stronger digital engagement. Or, they could usher in a new era of AI-created content (movies, music, etc.).
Of course, future Web3 technologies could also see their fair share of pushback. For instance, the U.S. government recently added Ethereum coin mixer Tornado Cash and addresses associated with the service to its Specially Designated Nationals list – a classification that typically applies for terrorist organizations and enemy nation states.
The Bottom Line
Web3 technologies are already reshaping a small corner of the Internet, but over the coming years, they could unlock greater privacy, security, and other benefits. Anyone interested in the crypto space should keep an eye on these developments, particularly when looking to invest in the people and projects pushing the envelope.
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