Understanding Web3: in a nutshell
The term web3 is being passed around like water within and outside of the crypto space. Some love the idea and some think its a over-glorified version of Web2 with hardly any differences. Let's dive.
I have been receiving several questions about what Web3 is, so without any long narratives, I’ll attempt to break it down as simple as possible.
To understand Web3, we need to revisit Web1 and Web2:
Web1: World-wide web begins (Read-Only)
The internet officially existed since the 1980s. Content creators had the chance to have a place online, but majority of its users back then were on static web pages and seldom produced content. Those who dominated content creation at the time were professional writers, reporters, journalists and it was a consequence of shifting from print media to the internet. The rest of the people on the internet came to consume or read-only.
We saw a reduced censorship here as compared to print, though it was still dominant. As a result, many were questioning the credibility of the rapid growing database of information. There were loose social platforms on Web1 and only a few “internet companies” controlled content online. Web1 type platforms still exists till today, although its not typical anymore. Craigslist is one you are likely familiar with.
Web2: The social web (Read-Write)
Web2, or the web as we know it today, took over in the early 2000s. Web2, coined by Tim O'Reilly, was prompted by upgrades to servers, developer skills and quicker internet speeds - leading to the interactive and beautiful web applications we have today. Some people attribute its inception due to the post-mortem of the dot-com boom.
Plenty of companies are in the Web2 space but there are a few giants that we are all familiar with(. Essentially, it allowed for a space for ‘anyone’ to become a content creator and a consumer simultaneously, though not everyone is able to monetize their creations. Users like you and I produce content on social networks such as Facebook, who is then able to sell personal data of their users to generate large amounts of revenue. This can pass because centralized companies have ownership over user data and all user-generated content. Censorship is better on Web2 compared to Web1, but its still platform-dependent; dependent on where you are surfing.
Although the internet here allows for both suppliers and consumers, they are essentially at the mercy of the platforms they are consuming and creating upon, handing over rights to any sense of ownership. “Creators are building their businesses on rented land when they are building on web2 platforms.” by @ljin18 in a @BanklessHQ interview on YouTube (link).
Users need to create an identity across each platform to interact as platforms do not “talk” to each other. This is why we constantly need to “Sign-up” on new platforms using personal emails and user generated passwords. In addition, capital is accumulated at the top. Privacy is a huge concern as intermediaries are responsible for protecting ours.
Web3: The “decentralized” web (Read-Write-Own)
Picture taken from Andreessen Horowitz’s A16z 2022 State of Crypto Report.
Ownership is one of the key features of Web3 - participants have “full” ownership over their content, data and assets, - the narrative being pushed with Web3 proponents.
The Bitcoin network was introduced in 2009, which provided the ethos that Web3 stands for. It is crucial to note that the internet today has not reached what we consider to be Web3. However, if you have been in the crypto space for a while, there are myriads of products and services already being built and used, that are considered to be “Web3”. This simply means that they adhere to the following principles to varying degrees: open, decentralized, censorship-resistant, immutable, trustless, and permission-less.
We are also seeing Web2 platforms think and brainstorm what it means to fit in the Web3 space, such as Twitter’s Bluesky project which aims to create a decentralized standard for social media. Elon Musk also stood for an uncensored free speech reality when he wanted to acquire twitter. The transition of Web2 to Web3 is similar to how Web1 evolved into Web2 in terms of infrastructure development and technological advancements (data storage and processing power in chips). However, there is a mindset shift for developers and builders as governance will be more user-centered. By removing the middleman and with data now living on an immutable infrastructure, there is no control (or not as much) over data thus no (less) censorship and less risk of data loss.
Interoperability is a major theme for blockchains as it will also be for web apps built on Web3. different platforms can be pieced together to make one fluid space where one’s identity can remain the same, i.e. not needing to make an account across different platforms. We see Layer 0s (discussed in my first article on blockchain layers) such as Cosmos, Polkadot, etc. attempting to create a cross-chain reality for the future.
Many claim that Web3 is as simple as setting up a crypto wallet like MetaMask. Yes, having a wallet helps one connect to various decentralized apps in order to interact and make transactions. However, it isn’t as simple as one might think, but understanding these Web3 tools such as MetaMask and others can help to shape our thinking for the future internet.
Here is an excellent thread, a mapping of Web3 protocols and its Web2 equivalents:
Lets look at some real, already implemented examples.
Take Medium for example, a centralized tool for writers to publish and earn some income without any say in its governance. In contrast, Mirror gives writers the ability to gain full ownership of their work (charging for content and newsletters), have a say in its governance (like co-owners), and earn directly from their audience.
More examples are the Opera and Brave browsers. For instance, Opera has integrated a native cryptocurrency wallet to hold crypto coins safely and serve as a single login to all Web 3.0 decentralized applications. They recently launched a separate dedicated Crypto Web3 browser (in the Opera link above). Alongside, the privacy-focused Brave browser has integrated a decentralized file hosting solution called IPFS. IPFS is a peer-to-peer file-sharing system similar to BitTorrent.
Brave has also implemented $BAT (Basic Attention Tokens) to enable blockchain-powered advertising. Users can choose to watch ads while preserving their privacy and earn $BAT rewards in return. This makes up for a win-win situation for both parties.
Web3 disadvantages currently (don’t think i forgot)
Widely adopted technology across the globe isn’t battle ready for Web3
Less capable devices would be left out
With change in the cost model, some services may not be free anymore :(
With internet providers under government control, the internet will still not be decentralized.
Easy to get user’s PUBLIC information (public for a reason perhaps?)
As of now, too complicated for newcomers
Web3 needs more stringent privacy policies.
My brief take
This is precisely the theme we will continue to observe as we all start shifting to Web3. As with Web1, Web2 will always exist in parts of the internet, but won’t dominate spaces where we spend most of our time online in the future.
I hope I kept this straight-to-the-point and that you learned a bunch about what Web3 is aiming to be and pushing towards, learning and evolving from the great internet we discovered since the ‘80s. Reach out to me or leave a comment if you want to discuss further! (Links below)
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