What is Web 3.0? - Reading time: about 4 minutes
This article provides a foundational understanding of what Web 3.0 is all about. It gives a beginner introduction to this concept of internet infrastructure and its convergence with blockchain and cryptocurrencies.
Think of Web 3.0 as the third generation of the Internet: one that is blockchain-based and which will shift ownership of data from large tech companies to individuals. The idea behind Web 3.0 is to facilitate information exchange and at the same time, enhance security for users, thus increasing trust.
From Web 1.0 to Web 2.0
It started with Web 1.0, an era where the internet mainly served informational purposes as developed by Tim Berners-Lee in 1989. It was revolutionary at the time, since there was nothing like it. The internet at the time delivered mainly static content without the option to interact or engage.
Then came Web 2.0 in 2004, which changed the one-way communication approach of the previous era to two-way. That is, it moved the internet from being read-only to the read-write web in which user interaction became the norm. The change gave rise to many websites that allowed for user-generated content, enhanced usability for end-users, and made the participative social web possible. It has been evolving ever since. Over time, the smartphone became the enabler that spread the participatory nature of the web to more users across the world.
While Web 3.0 is no longer an entirely new concept to many, much of the internet is still in the Web 2.0 era and the big tech companies—which dominate the internet–-continue to facilitate the launch of more consumer-facing applications—both on Android and iOS—as a means of harvesting customer data.
The Origins of Web 3.0
Coined in 2014 by the founder of Web3 Foundation, Dr. Gavin Wood, Web 3.0’s idea of giving individuals control of their personal data and identity emanated from the view that the current internet infrastructure (i.e. Web 2.0) empowers certain tech entities by design to breach the privacy and authenticity needs of users. Meanwhile, it allows these entities the opportunity to harvest users’ data for advertisement and other for-profit purposes.
While Web 2.0 enables users to create and interact with content on big platforms like YouTube, it will also go down as the Internet era in which Big tech’s monopolies exploited, owned, and monetized users’ data.
Web 3.0 seeks to democratize the internet, bypassing big tech companies while being decentralized with no single point of authority. Web 3.0 allows not just large companies and individuals to produce and consume content, but computers as well.
Being user-owned, Web 3.0 enables digital property rights for the first time with its decentralized protocols that allow open access to distributed data. It is introducing new monetization paradigms that get embedded into software to converge consumption with investment and cause consumer behavior to shift in an economy that is increasingly becoming digital.
Web 3.0’s openness also seeks to connect a user’s online identity with their reputation and to avoid centralized decisions from dictating how information, content and communication are moderated. As a result, the concept’s freedom brings Web 3.0 to the center of crypto and blockchain with rights and benefits being converted into a digital unit of value (token) in a process known as tokenization.
The past few years have seen many projects pick up the idea of tokenization which involves the representation of real physical or traditional assets in a digital form on distributed ledgers like blockchain. It has led to new financial products being created and individuals as well as organizations afforded the opportunity to diversify their investment portfolios regardless of their geographical location.
As a result, more partnerships between Web 2.0 and Web 3.0 companies are now in sight. Such partnerships —like the recent PayPal (Web 2.0 payments companies) and Metamask—serve as a pipeline for granting more accessibility for mainstream consumers to make inroads into the crypto space. This is leading to a widening of related subsets of the industry including the decentralized finance (DeFi) market, NFT marketplaces, and gaming. It has also spurred increased competition among related projects.
The Rising Web 3.0 Ecosystem
As Web 2.0 and Web 3.0 continue to overlap, a lot of changes are expected to take place in the tech space as a whole. Seen as the third iteration of the internet as we know it, the Web 3.0 ecosystem’s blockchain-based growth is set to usher in innovative economic models using crypto assets.
Web 3.0 promises to deliver a new Internet experience, coupled with all the freedom and innovation that the crypto industry brings. This decentralized internet will seek to flip control of data and apps from centralized entities towards communities and individuals.
However, while Web 3.0 won't exist without blockchains and crypto, it is not defined by them.