Web2 is the Internet as we know it today, whereas Web3 refers to the evolution and next generation of the Internet. In fact, Web3 hasn’t completely arrived yet and thus, we don’t even know exactly what it’s going to look like. However, we can paint a picture of Web3 and the components it may possess, mostly thanks to cryptocurrency projects – many of which have already embraced blockchain technology, and are in the process of revolutionizing the financial world. If the Internet, as a whole, moves in the same direction, it will completely change the way we act and interact online.
The purpose of Web3
The Internet is currently controlled by Big Tech companies like Youtube, Amazon, Netflix and Meta (Facebook) – they hold the information, the power and the profits. Web3 plans to steer us towards decentralization of power and profits by instead letting it trickle down to the participants. At present, the most promising way to achieve this is would be to use blockchain technology and a version of Decentralized Applications (Dapps). You can find out more about how Web3 relates to blockchain here.
A short history of the Internet
Web1 – a stream of information
The first generation of the World Wide Web existed between 1991-2004. It was also known as the read-only web. It enabled the broadcast of information and it allowed users to search for it and read it. It mostly consisted of static webpages, and there weren’t many content creators around. Although it was revolutionary for its time, interaction and functionality was rather limited.
Web2 – a stream of interaction
The current version of the Internet as we know it – less static and more dynamic. Web2 started to become popular in 2004, when the first Web2 conference was held. The system behind it aims to actively engage users, and the content itself is more user-generated. The way we share and deliver information has been transformed with Web2 components like blogs, wikis and social media platforms. Take Facebook or Twitter as examples: users can not only read information, they can also share thoughts, perspectives and opinions by liking, sharing, tagging, tweeting etc. Undoubtedly, there is a dependency on “Big Tech” companies to provide the infrastructure and services we need – a reliance Web3 hopes to remove.
Web3 – a stream of interpretation
The future, and a more intelligent, autonomous and open version of the Internet. Computers will be able to interpret information in a way that is more similar to humans, and by using technologies like Blockchain, Artificial Intelligence (AI), Augmented Reality (AR) and Virtual Reality (VR), users will be given more personalized content and experiences.
Potential benefits of Web3
- Personalization: With Web3, the Internet experience would become more customized to the user – more efficient search, relevant marketing, better communication and increased information linking.
- Ownership of information, data and digital assets: Using blockchain technology, Web3 aims to displace tech giants by handing complete ownership of data back to the users. Currently, Big Tech companies like Facebook and Amazon store your data and personal information, mostly to improve their target marketing. However, many have raised privacy concerns over such one-sided data governance and see Web3 as a solution. Blockchain technology is already being used to secure financial data in the crypto space, where transactions in the ledger are stored in a permanent and verifiable way. Access to the data can be retained through encryption keys, which are independent from the service or application that generated the original data.
- Secure peer-to-peer (P2P) network: Web3 gives users the ability to connect, transact and share data privately and without relying on a third party. With Web2, every time you interact with the internet, copies of your data get sent to the data servers, and you no longer own it exclusively. P2P can be explained as a group of computers that are linked together with equal permissions and responsibilities for processing data – there is no centralized server. Huobi uses P2P technology – the management of transactions and the issuing of tokens is carried out by the network rather than a central authority or bank.
- More democracy and involvement: users will be more involved in future developments of ecosystems. As a result, the ecosystems will not have presidents or CEOs but Decentralized Autonomous Organizations (DAOs) in which token owners will decide on essential changes and developments, as a collective.
- Permissionless: Another way in which Web3 provides a more democratic system is that there are no restrictions on who can be part of the network – neither users nor suppliers will require authorization from a governing body in order to participate. Services are available to everyone, and individuals can influence the networks based on the value they provide. You can be an investor, developer, or marketer and help the network succeed with your unique skills and output. You may even be rewarded by receiving a share of the total token supply.
- Digital Identity In contrast to web2.0, you will have your own digital identity, and more control over your privacy. For example, using an alias and a digital avatar would assure users that their internet usage is private and secure – something many of us doubt under the current Web2 system. With the development of Web3, Decentralized Digital Identity (DID) becomes a possibility. A DID is an address on the Internet that people can own and control directly. It can be used to find what’s known as a DID document, which in turn contains relevant information to enable use cases, such as login, data encryption and communication. Cryptographic proofs are used to allow others to prove control of these identifiers. Users control everything, and can decide when, with whom, and under what conditions their digital identity elements are revealed. DIDs can do for the Internet, what passports do for governments – they securely identify and provide authentification, only with more ownership and self-governance.
- Censorship resistance Web2.0 is currently stored in centralized servers. These servers can be accessed, altered or removed by any party that gains control of the server, including corporations, governments, or hackers. These parties can also deny access to services on their own authority, which may not be legitimate. Blockchain-related technologies like IPFS and distributed hash tables can form a content system that is much more difficult to block and more difficult to take down.
Potential challenges of Web3
- Size and cost: The internet is massive and so creating a system that can read, understand and interpret that much data is challenging, not to mention expensive.
- Inconsistency and uncertainty of data: There is inconsistent data all over the Internet wich can lead to logical contradictions and make data analysis very difficult.
- Adoption: Internet users are a mixed bag, and although some will embrace the forward-thinking Web3 ideology, many are likely to be put off by its complexities – technology generally deals with change better than a human being.
- Devices: less advanced devices may not be able to handle Web3, which just adds to the adoption challenge.
- Dangers: bad actors could leverage some of Web3’s strengths to get around restrictions on their activity, and while decentralisation can still rely on community power to intervene, this process will be very different from traditional governance and take getting used to.
How will Web3 work in practice?
Without diving too deep into explaining the technological details, Web3.0 is about utilizing blockchains and many other decentralized protocols, like external data oracles, storage, messaging, and digital identities. As you may already know, the values in Web3 are represented in cryptographically secured tokens.
However, the technological advancement in decentralized systems doesn’t mean that the internet will look different. An everyday internet user might not even see the difference since web3’s innovation is mostly noticeable at the “backend” of the internet. Therefore, you can expect to see decentralized versions of the same applications that you are currently using without significant visual differences.
Let’s end with a reminder that Web3 doesn’t really exist – yet. There is no general agreement on it, but we can recognize that it’s a combination of permissionless, transparent systems that can decentralize power from central authorities and solve problems of the internet. Let’s face it: there must be a better way than constant cookie permissions and banner ads.
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