A Web 3 world that is being predicted is often viewed with skepticism and leeriness, similar to how most people viewed the internet in the 1990s. During an interview with Bill Gates in 1995, David Letterman teased Gates by asking, “What about this internet thing? Do you know anything about it?
What is it exactly?” Gates explained how the internet was going to the world by allowing people to send emails and provide information through web pages electronically.
At the time, Gates was not aware he was describing the first iteration of the internet, Web 1.0 — a static and read-only internet. However, two and a half decades later, the internet has evolved exponentially to Web 2.0, and currently, it’s transitioning to Web 3.0. We are at the tipping point of a new phase in the Web’s evolution.
So what will this new phase look like? In this article, we will explore what the latest internet experience, Web 3.0, will look like and some of the projects working on Web 3.0 applications.
Recap: What is Web 3.0?
To understand Web 3.0, it makes sense to understand what came before. The earliest iteration was the Web 1.0 ecosystem, a static and read-only internet. Websites weren’t particularly interactive, and users could not do much apart from reading information on web pages.
Ten years later, the internet transitioned to the second iteration of Web 2.0, an interactive read-write internet. This version of the internet allowed users to read information from websites and interact with the websites and other users. Platforms like Facebook and WhatsApp allow people to communicate in real-time and take sharing content to a whole new level.
However, after a few data breach cases, users became conscious that large tech companies collected their data and sold it to other tech companies. Facebook, in particular, received the highest penalty, $5 billion in 2019, due to numerous data breach cases. As a result, these shortcomings sparked a new revolution in a new internet model, Web 3.0.
According to CoinDesk, Web 3.0 can be referred to as a Read-Write-Own phase of the internet. Rather than just free tech platforms and trusting that the tech giants will store your data securely and honestly, Web 3.0 allows users to participate in the governance of the protocols used to run Web 3.0 applications. This means that you are not only an end-user but also a shareholder of the applications.
In a Web 3.0 ecosystem, exchange platforms represent company shares as tokens that give you access to the application’s decision-making process. If you hold a substantial amount of an application’s token, you have a say over the governance and operations of the application. Furthermore, anyone can own the tokens, and exchanges do not restrict investing to a particular class of investors like accredited investors on Web 2.0.
Primarily, Web 3.0 is to give back users control over their online data and identities and provide easy accessibility to the internet (Web 3.0) and all its inherent services. With this understanding, let’s explore how Web 3.0 will look when it comes to full fruition.
How will users experience the internet in a web 3 world?
Web 2.0 has been running on conventional communication protocols, third party models, and human-driven technologies for the past two decades. However, with Web 3.0, the current architecture is not sufficient to support the transition to a Read-Write-Own model. Several technologies will play a crucial part in facilitating this transition.
i. Blockchain Technology, the core of Web 3.0
According to Preethi Kasireddy, networks in Web 3.0 exhibit interoperability, automation, seamless integration and censorship-resistant storage of peer-to-peer data files. It is quite clear that blockchain would serve as the key driving force for the next generation of the internet.
Blockchain offers a universal state layer which is subject to collective management. In layman’s terms, blockchain maintains a consistent ledger of all the data across Web 3.0, which the network participants maintain. This is contrary to how Web 2.0 operates, where tech giants have total control over data centres. Blockchain’s state layer provides the opportunity for developing a trustless value settlement layer on the internet where users can make direct transactions and communication in a copy-protected manner.
In a blockchain-Web 3.0 ecosystem, you do not need third parties to authorize or secure your transactions or communication channels. Cryptographic protocols on the blockchain handle it on your behalf.
ii. Artificial Intelligence (AI)
Some aspects of Web 3.0, like Siri and Alexa voice assistants, portray how machine learning and AI can develop a new array of internet services. However, these two voice assistants use different data sources in such a scenario. Alexa uses Amazon databases, and Amazon controls over 50% of the internet with their data centres, while Siri primarily uses the internet and some other databases. Each company uses its proprietary protocols, which might put other companies at a disadvantage.
However, in an AI-Web 3.0 internet, blockchain distributes the data among all the nodes on the network. Each voice assistant company would retrieve data from a singular and consistent data source. Moreover, since data on the blockchain is immutable and everyone can view the data, it becomes challenging to manipulate. As Web 3.0 advances, AI models will ultimately be able to provide users with the best filtered and unbiased data available.
iii. Augmented Reality (AR) and Virtual Reality (VR)
Web 3.0 is also coined as the spatial Web since it aims to break the line between the physical and the digital by revolutionizing graphics technology and introducing a precise focus on three-dimensional virtual worlds. Unlike its 2D counterparts, Facebook, Instagram and other social platforms, Web 3.0 introduces a new level of immersion and interaction through AR and VR.
Applications like Decentraland provide a virtual world where users can interact and socialize using avatars. Aside from creating an account, users can explore different worlds, brands and businesses. Furthermore, like online stores on Instagram, users can also make purchases on Decentraland. Other platforms like Somnium space allow you to leverage immersive VR devices like VR glasses to get fully immersed in a virtual world where you can invest in real estate.
iv. A decentralized and distributed network
One of the major pain points of Web 2.0 is the centralization of data centres. As mentioned above, a select few tech companies own most data servers today. According to Fierce Telcom, Amazon, Microsoft, and Google account for more than 50% of the world’s largest data centres. These three companies control more than half of online information. If each of these companies decides a particular set of information does not align with their values, they have the authority to bring it down.
However, contrary to this model, Web 3.0 ensures that nodes store data in a decentralized and distributed way. Platforms like Filecoin and IPFS distribute your data across all the storage nodes on the network. If one node chooses to delete your content or data, it’ll still be accessible on the other nodes, and you can retrieve it.
Since there is no central authority, users have total control of what can be published on a Web 3.0 internet. Moreover, Web 3.0 directs the fees paid for storage to the storage providers. Therefore, if you delegate some of your storage space to support Web 3.0, you are incentivized with crypto assets or FIAT currencies.
2. A Ubiquitous and accessible network
Ubiquity means the ability to be everywhere at the same time. In that sense, Web 2.0 is already ubiquitous since platforms like Facebook and Twitter allow you to share information globally in real-time. However, Web 3.0 takes this further by making the internet available to everyone and other interconnected devices.
Aside from blockchain, another critical technology driving Web 3.0 is the Internet of Things (IoT). Currently, most IoT platforms rely on centralized data to work efficiently. This data comes from biased sources that might obscure accurate data and propagate biased or corrupted data. As such, users and web applications cannot fully trust data from conventional APIs or data sources.
Web 3.0 will rely heavily on connectivity and data accuracy. It is logical to integrate smart contracts into the IoT ecosystem. This will ensure that cryptographic protocols audit any data propagated to IoT devices. As a result, this creates an autonomous and tamper-resistance ledger that provides data to IoT devices.
An excellent example is IBM, which allows organizations to share and access IoT data without central authorities or human management.
3. Privacy, data security and digital identities
Web 3.0 will mean humans and organizations can share data with far greater privacy and security. Web 3.0 users will no longer rely on big tech companies and their inherent risks to store or share data. According to Anonyome, users will own their data and digital footprint through decentralized identity technologies and multi-signature applications.
On Web 3.0, digital identities are attached to digital wallets that use cryptographic keys rather than your data. For instance, to access the MetaMask browsers, you’ll need to have a MetaMask wallet. The wallet comes with two key pairs, a private key and a public key, which users use to authorize interactions with Web 3.0 applications and authenticate their identity.
Unlike traditional online accounts, your MetaMask identity is in the form of a group of digits, characters and alphabets, such as 0x12r45… 6HJ9. The address cannot be traced back to your identity, making you anonymous. Moreover, since any data users share with a Web 3.0 application is decentralized, they control who can access it, alter it or delete it from the decentralized ledger. Some of the leading decentralized identity solutions include Credebl, Hyperledger, Nxt Platform and BitMark, to mention a few.
4. Peer-to-Peer (P2P) interactions
P2P transactions and interactions are at the heart of the Web 3.0 internet. One of the significant goals of Web 3.0 is to eliminate third parties and allow users to communicate privately and freely. Web 3.0 also levels big corporations and individual users as equals.
Currently, users access content on Web 2.0 content in two main ways — you either pay directly to access content, or a webpage plasters their site with Ads. However, both ways involve going through an intermediary. In a Web 3.0 internet, blockchain would allow for tokenized direct payments that would move from your digital wallet directly to the producer’s wallet. This makes content on Web 3.0 more independent.
For instance, as a creator, you can tailor your content and target a specific audience through the blockchain network. On the user side, the blockchain system would be your way to consume data without having to second guess its credibility. Although there isn’t much development on this front, Publish0X is an excellent alternative to Medium.
5. A Decentralized Finance (DeFi) system
Web 3.0 features open, decentralized and interconnected internet protocols that provide P2P automated services and decentralized finance via smart contracts built on top of distributed ledger technologies. Today, in order to access any financial service, you need to get authorized by a third party such as banks, credit unions, brokerage firms, insurance companies or savings and loan associations.
In Web 3.0, decentralized finance covers the tokenization of financial products like securities, bank products, savings options and lending services. Most of these services are developed on blockchain technology and an AI-driven model for Automated Market Makers. Moreover, Web 3.0 utilizes digital currencies like cryptocurrencies and central bank digital currencies (CBDCs).
While conventional global transactions take days to be processed and are run through numerous third parties, cryptocurrencies on Web 3.0 are P2P. For instance, Bitcoin allows near real-time transactions that will enable users to pay directly to merchants or individual recipients using digital wallets.
Furthermore, DeFi applications like Aave offer financial services like savings, loans and the opportunity to earn interest on your savings. You can think of Aave as your traditional bank. Aave is a P2P financial platform that uses cryptocurrencies as exchangeable assets. Unlike Web 2.0 financial services, Aave uses algorithms to determine lending and interest rates.
As a result, Aave eliminates third parties and allows users to interact with each other directly. Moreover, the terms and conditions and rules that Aave follows are included in smart contracts, which ensure they are maintained.
6. Cryptocurrency Securities and Exchanges
In traditional finance, financial institutions define security as a stake of ownership in a public-traded corporation. According to Investopedia, to get substantial returns from the shares of a company, investors need to satisfy various regulations, such as having an annual income exceeding $200,000 or even having a net worth exceeding $1 million.
On a Web 3.0 decentralized financial system, anyone can earn high returns from securities, often known as tokens. Crypto projects use these tokens to represent ownership of their project. Unlike traditional securities, tokens are listed on crypto exchanges that allow anyone to register and purchase the assets.
However, some centralized crypto exchanges restrict services in some jurisdictions. To solve this shortcoming, there are also decentralized exchanges governed by the users. This ensures that anyone can join the platform and invest in assets.
Why Web 3.0 is not fully implemented?
Web 3.0 has many features that have the potential to revolutionize the internet. However, looking back from the start of Web 2.0, users have been relying on third parties to facilitate interactions and transactions across the internet. As such, transitioning to a decentralized, trustless internet will need an efficient system to work correctly.
Here are some reasons why Web 3.0 has not been adopted fully.
Scalability issues – since transactions rely on blockchain architecture, they are slower on Web 3.0. For instance, transactions on the Bitcoin network require miners to validate the transaction and append it to the blockchain. For other proof of stake blockchain protocols, the network needs to agree on the state of the transaction for it to be processed.
User Experience challenges – unlike conventional Web 2.0 Apps., Web 3.0 Dapps are not quite straightforward. For instance, users must have a digital wallet to make a simple transaction. Moreover, they also must understand how digital keys work to verify transactions.
Accessibility issues – most Web 3.0 Dapps are not integrated into modern web browsers, making them less accessible to the average user.
Web 3.0 Applications can be costly – lastly, transactions on Web 3.0 Dapps that run on blockchain protocols require funds to complete transactions or interactions. Protocols like Ethereum can be costly, reaching hundreds of thousands for simple interactions.
Web 3.0 is still in its infant stages. As such, it’s quite early to know what the third iteration of the internet will certainly look like. However, it’s certain that technologies like blockchain, artificial intelligence, augmented reality, and virtual reality will play a vital role in this transition. Moreover, the Web 3.0 ecosystem will certainly be decentralized and give users control over their data.
Like any technological revolution, there are still some obstacles that Web 3.0 has to overcome to be fully implemented. However, the potential upside of Web 3.0 is exciting, promising users a transition from a data-hungry and privacy-encroaching Web to a distributed, decentralized, and censorship-resistant internet.