Web 3.0 Completely Explained
A potential future iteration of the internet known as Web 3.0 is built on public blockchains, a database best known for facilitating cryptocurrency exchanges.
Web 3.0 is appealing because it is decentralized, which means that instead of consumers using services that are mediated by businesses like Google, Apple, or Facebook, individuals themselves own and control portions of the internet.
Web 3.0 does not require “permission” or “trust,” which means that central authorities cannot control who has access to what services. It also does not require an intermediary for virtual transactions to take place between two or more parties.
Web 3.0 technically protects user privacy better because these organizations and intermediaries are doing the majority of the data collection.
Decentralized finance, also referred to as DeFi, is a Web 3.0 feature that is gaining popularity. Real-world financial transactions must be carried out on the blockchain without the assistance of banks or the government. In the meantime, a lot of large companies and venture capital firms are investing heavily in Web 3.0, and it is difficult to imagine that their involvement won’t lead to some centralized power.
In this article, we’ll discuss how the web has changed over time, why Web 3.0 is a hot topic, what it’s used for, what Web 3.0 in crypto means, where it’s going next, and why it matters.
The emergence of the internet
The World Wide Web is the primary medium through which billions of people exchange information, read, and write content, as well as communicate with one another and other users of the internet. The World Wide Web has gone through a lot of evolution over the years, and the applications that it uses now are almost unrecognizable compared to the ones that it used when it was first starting out. The development of the World Wide Web can be broken down into three distinct stages: Web 1.0, Web 2.0, and Web 3.0.
Web 1.0 Explained
Web 1.0 is a term used to describe the very first version of the internet. Web 1.0 can be thought of as the read-only web or the syntactic web. The majority of participants took part in the event as content consumers, while the vast majority of makers were web developers who developed websites that featured content that was primarily presented in the form of text or graphics. In general, Web 1.0 existed between the years 1991 and 2004.
In Web 1.0, websites typically distribute static content rather than dynamic HTML-based content. When it came to providing data and content, a static file system rather than a database was used, and the web pages featured very little room for interaction between users.
Web 2.0 Explained
The vast majority of us are only familiar with the most recent iteration of the web, which is also referred to as Web 2.0 and is also known as the interactive read-write and social web. Within the realm of Web 2.0, it is not necessary to have programming experience in order to take part in the creation process. There have been many apps made so anyone can make their own now.
You have the capacity to think and the ability to communicate that thought to the rest of the world. You are able to make a video public on Web 2.0 and share it with millions of other users so that they can watch it, participate in it, and leave comments on it. Applications on social media platforms such as YouTube, Facebook, Flickr, Instagram, and Twitter are examples of Web 2.0 applications.
Thanks to web technologies such as HTML5, CSS3, and Javascript frameworks such as ReactJs, AngularJs, VueJs, and others, businesses have the ability to develop innovative ideas that encourage users to contribute more to the Social Web. Because Web 2.0 is centered on users, developers need only create a system to enable and engage users in order to fulfill their responsibilities.
Think about how popular apps like Instagram, Twitter, LinkedIn, and YouTube were in their earlier years compared to how they are now. The differences are striking. The following procedure is one that is typically adhered to by each of these companies:
- The company releases an app,
- Enrolls as many users as it can, and then
- Monetizes its user base.
The user experience is frequently incredibly slick when a developer or company releases a well-known app, especially as the app’s popularity increases. This is what allowed them to gain traction so quickly initially.
Many software companies initially give monetization little thought. Instead, they are only concerned with attracting and keeping new customers, but they eventually need to start making money.
However, the limitations of accepting venture funding frequently harm the lifespan and, in the end, the user experience of many of the applications we currently use. For instance, investors typically expect a return on investment in the tens or hundreds of times of what they invested when a company raises venture capital to develop an application.
This indicates that the company is frequently steered down one of two paths: marketing or data sales, rather than pursuing a long-term growth strategy that can be sustained organically.
More data for numerous Web 2.0 businesses like Google, Facebook, Twitter, and others translates into more targeted advertisements. More clicks are generated as a result, which increases ad revenue. Utilizing and consolidating user data is essential for the web to function as we currently know and use it.
Data breaches consequently frequently occur in Web 2.0 applications. Even websites that track data breaches and notify you when your personal information has been compromised exist.
In Web 2.0, you have no control over how your data is stored. In reality, companies frequently collect and store user data without their consent. All of this data is then owned and managed by the companies in charge of these platforms.
Furthermore, governments frequently shut down servers or seize bank accounts when they believe someone is expressing an opinion that is in opposition to their propaganda. Using centralized servers, governments can easily interfer with, manage, or stop certain applications.
Since banks are centralized and digital as well, governments frequently intervene in them. They may close bank accounts or restrict access to funds during times of high volatility, excessive inflation, or other political unrest.
Web 3.0, which aims to fundamentally rethink how we create and use applications, will hopefully address many of these flaws.
Web 3.0 Explained
The Web 3.0 era, also referred to as Semantic Web or read-write-execute, begins in 2010 and signals the future of the internet. By enabling computers to analyze data in a similar manner to humans, artificial intelligence (AI) and machine learning (ML) enable the intelligent creation and distribution of valuable content tailored to the individual needs of a user.
Decentralization is at the core of both Web 2.0 and Web 3.0, though there are a few key differences between the two. Developers of Web 3.0 applications hardly ever produce and distribute ones that use a single server or a single database to hold data (usually hosted on and managed by a single cloud provider).
Web 3.0 applications, on the other hand, are constructed on blockchains, decentralized networks of numerous peer-to-peer nodes (servers), or a combination of the two. These applications are referred to as decentralized apps (DApps), and the Web 3.0 community uses that term frequently. To create a reliable and secure decentralized network, network users (developers) are rewarded for providing the best services.
What does Web 3.0 in crypto mean?
You’ll discover that cryptocurrency is frequently brought up when discussing Web 3.0. This is due to the fact that many Web 3.0 protocols have a strong reliance on cryptocurrencies. Instead, it provides a financial incentive (tokens) to anyone who wants to assist in the development, administration, contribution, or improvement of one of the projects.
Digital assets known as “Web 3.0 tokens” are linked to the goal of building a decentralized Internet. These protocols may offer a range of services, including hosting, computation, bandwidth, storage, identification, and other online services previously offered by cloud providers.
For instance, the Ethereum-based Livepeer protocol offers a market for providers of video infrastructure and streaming services. Similarly, Helium uses blockchains and tokens to entice individuals and small businesses to provide and confirm wireless coverage and send device data through the network.
The protocol offers a variety of technical and non-technical ways for people to make a living. Similar to how they would pay a cloud provider like Amazon Web Services, users of the service typically pay to use the protocol. The elimination of unnecessary and frequently wasteful intermediaries is a common feature of decentralization.
Additionally, nonfungible tokens (NFTs), digital currencies, and other blockchain components will be crucial components of Web 3.0. For instance, Reddit is attempting to break into the Web 3.0 space by developing a system that uses cryptocurrency tokens to let users effectively control portions of the online communities in which they engage.
According to the idea, users would use “community points,” which they would acquire by posting on a particular subreddit. The number of users who upvote or downvote a specific post determines how many points the user receives. (It’s just Reddit Karma on the blockchain.)
These points can essentially be used as voting shares, giving users who have contributed significantly more influence over decisions that have a larger impact on the community. These points can’t just be taken away because they are stored on the blockchain and track you, giving their owners more control.
Fair enough, this is just one application of a Web 3.0 concept called Decentralized Autonomous Organizations (DAOs), which employs tokens to more evenly distribute ownership and decision-making power.
Web 2.0 in contrast to Web 3.0
Let’s compare Web 2.0 and Web 3.0 using the table below.
What characteristics does Web 3.0 have?
The transition from Web 2.0 to 3.0 is taking place gradually and without much public notice. Web 3.0 applications resemble 2.0 applications in terms of appearance, but they have a fundamentally different back end.
The future of Web 3.0 points to universal applications that can be accessed and used by a variety of hardware and software types, simplifying our professional and leisure activities.
By resisting the centralization, surveillance, and exploitative advertising of Web 2.0, emerging technologies like distributed ledgers and blockchain storage will enable data decentralization and the creation of a transparent and secure environment.
When decentralized infrastructure and application platforms replace centralized tech firms, people will be able to control their data in a decentralized web legitimately.
To better understand the nuances and complexities of Web 3.0, let’s examine its four key characteristics.
Semantic web
A key element of Web 3.0 is the “semantic web.” Tim Berners-Lee coined the phrase to describe a web of data that computers can analyze. Consequently, what does that mean in plain English? What does the word “semantics” actually mean? What differentiates “I adore cryptocurrencies” from “I < 3 cryptocurrencies”?
The two phrases have different syntaxes, but they have similar semantics. Semantics is concerned with the meaning or emotion that facts express, and in the example above, both of those sentences express the same emotions.
Artificial intelligence and the semantic web are Web 3.0’s two pillars. By helping the computer learn what the data means, the semantic web will enable AI to create practical use cases that will make better use of the data.
The main idea is to create a knowledge spiderweb on the internet that will help with word meaning comprehension as well as content creation, sharing, and connection through search and analysis.
Semantic metadata in Web 3.0 will make data communication easier. The user experience advances as a result to a new level of connectivity that makes use of all available data.
3D graphics / images
When Web 3.0 is fully implemented, the internet will be transformed from a straightforward two-dimensional web into a more realistic three-dimensional cyber world. This change will have repercussions for the future of the internet. The use of three-dimensional design is widespread across Web 3.0 websites and services, including e-commerce, online gaming, and the online real estate market.
The fact that thousands of people from different parts of the world are interacting with one another at this very moment is a reality, despite the fact that it might appear strange to think about it. Imagine players of online games such as World of Warcraft or Second Life being much more concerned with their virtual avatars‘ well-being than their real-life counterparts.
Artificial Intelligence (AI)
Artificial intelligence will allow websites to analyze user data and provide the information that is most pertinent to their needs. In the era of Web 2.0, businesses have begun to solicit customer feedback in order to gain a better understanding of how well a particular product or asset functions. Consider as an example a website such as Rotten Tomatoes, which allows visitors to rate movies and leave comments on them.
Movies with higher ratings are typically what people refer to when they talk about “good movies.” The ability to quickly move from “poor data” to “good data” is made possible by using these lists.
As was just mentioned, one of the most significant contributions made by Web 2.0 is the ability to engage in peer reviews. On the other hand, as is common knowledge, human recommendations are not immune to the influence of bias.
It is not impossible for a group of individuals to collude in order to give a movie exaggeratedly positive reviews for the purpose of increasing the movie’s ratings. The use of artificial intelligence allows us to distinguish between reliable and unreliable data sources, and it also provides us with accurate information…
Ubiquitous
Ubiquitous is a term used to describe the idea of existing or being present in multiple places at once, also known as omnipresence. Web 2.0 already includes this feature.
Consider social media sites like Instagram, where users can upload and share the photos they take with their phones to make them their intellectual property. The image becomes widely accessible after being posted online.
The Web 3.0 experience will be available anywhere, at any time, thanks to the development of mobile devices and an internet connection. When compared to Web 1.0 and Web 2.0, your desktop computer and smartphone will no longer be the only devices you can use to access the internet.
It will have infinite power. Web 3.0 is sometimes referred to as the web of everything and everywhere because the majority of the objects around you are connected online (Internet of Things).
What can you do to prepare your company for the Web 3.0 revolution?
Even though it may sound like something from a distant future, early applications of the spatial web, also known as Web 3.0, are already in existence. Executives in businesses need to be aware of what the next computer era will entail, how it will have an impact on businesses, and how it will create new value as it progresses.
In addition, people need to be ready to understand how some of the more established and experimental Web 3.0 business models will increase in value in the coming years. This can be done by looking at Web 3.0 business models that are currently in use and that are current. A few of the available methods will be listed in the following sections.
Release of a native asset
These native assets are required for the network to function properly, and the level of protection they provide is the primary source of their value. The price of the native asset rises in tandem with the cost for malicious actors to launch an attack as a result of the provision of a strong enough incentive for honest miners to contribute hashing power. Additionally, the increased demand for the currency contributes to an increase in both its price and its value.
As a direct consequence of this, an in-depth analysis and precise calculation have been carried out in order to determine the value of these indigenous assets.
Establishing a network while maintaining the native asset
Some of the earliest cryptocurrency network companies had one primary goal, and that was to maximize their networks’ potential for gain in terms of both revenue and profit. The emerging business strategy can be summed up as “Grow their native asset treasury; build the ecosystem,” and this is how it should be implemented.
Blockstream, which is one of the most important Bitcoin Core maintainers, is dependent on its BTC balance sheet in order to generate value. In a manner comparable to this, ConsenSys has increased its workforce to 1,000 people and is working to develop essential infrastructure for the Ethereum (ETH) ecosystem in order to increase the value of the ETH that it already possesses.
Payment tokens
A new wave of blockchain initiatives has developed business models based on payment tokens within networks. These initiatives frequently form two-sided marketplaces and require the use of a native token for all transactions. The popularity of token sales has led to this new wave of blockchain initiatives.
In the hypotheses, it is assumed that as the economy of the network grows, there will be a greater demand for the restricted native payment token, which will result in an increase in the token’s value.
Burn tokens
Using a token to build communities, businesses, and initiatives may not always be able to directly distribute profits to token holders. For instance, one of the features of the MakerDAO (MKR) and Binance (BNB) tokens that attracted a lot of interest was the concept of token burns and buybacks.
As money enters the project (through MakerDAO stability fees and Binance trading fees), native tokens are repurchased from the open market and burned, causing a reduction in supply and an increase in price.
Speculating on taxation
The establishment of the financial framework for these native assets, including exchanges, custodians, and derivatives providers, was the focus of the subsequent generation of business models.
They were all developed with the same objective in mind: to offer users services so they could speculate on these risky assets. Organizations like Coinbase cannot secure a monopolistic position by offering “exclusive access” because the underlying networks are open and permissionless. However, over time, such companies’ brands and liquidity offer defendable moats.
What benefits does Web 3.0 have over its predecessors?
In Web 3.0, there will be no need for intermediaries, which means that user data will no longer be under anyone’s control. This lessens the likelihood of censorship by corporations or governments, as well as the destructive potential of denial-of-service (DoS) attacks.
Larger datasets provide algorithms with additional data to process as a result of an increase in the number of connected devices. They will then be able to provide users with information that is more precisely suited to their requirements as a result of this.
Before the release of Web 3.0, it was extremely difficult to find the most relevant result when using search engines. However, over the course of time, they have become better at identifying search results that are semantically relevant based on the context of the search and the data.
Web surfing becomes more useful as a consequence of this, making it simpler for anyone and everyone to locate the specific information that they require.
Customer service is essential to the development of positive interactions between users and websites and web applications. On the other hand, many successful online businesses are unable to scale their customer support operations because of the high costs involved.
Users are able to have more productive interactions with support staff by utilizing intelligent chatbots that are able to hold conversations with multiple customers at the same time, which is made possible by Web 3.0.
