What is Web3? A Guide to the Decentralized Web
"Centralization" has become a bad word these days.
But let's talk about facts.
If it wasn't for centralization, it wouldn't have been possible to onboard billions upon billions of individuals to the internet as we know it–web2, as it were–and develop the robust, mature infrastructure on which it is built.
The advent of web2 saw the rise of platforms that were once the darlings of the internet–Facebook, Google, Twitter, and Instagram, among many others, which enhanced human interaction to a level never seen before.
But like Harvey Dent put it, you either die young and be a hero, or you live long enough to see yourself become the villain.
Well, that's what happened in web2: the same entities that were responsible for enabling the unprecedented level of communication became the same gatekeepers that eventually put on a stranglehold on vast tracts of the internet and single-handedly deciding what can and cannot be published and who can and cannot use them.
Web3, or Web 3.0–regardless of what people call it–is emerging as the ultimate solution to this creeping monopolu of some of the tech conglomerates and governments. Web3's vision is a decentralized, democratic internet where power is concentrated in the hands of the people.
But before we go deeper into web3, it would be beneficial to lay out a brief history of the internet and explore exactly how we got here in the first place.
A brief history of the Internet
Let's face it: the majority of internet users tend to be on the younger side. Zoomers and later millennials, for instance, have been raised entirely on the World Wide Web.
However, anyone who has been around since the early days of the internet will know that the internet as we know it today has gone through quite a number of evolutions and stylistic changes from its initial inception.
We'll break down the phases of the internet's evolution into loosely-defined "eras"—web1, web2, and web3.
Web1 (Web 1.0): The Read-Only Era (1989-2004)
The seeds that eventually grew to form the backbone of the nascent World Wide Web were developed in 1989 by computer scientist Tim Berners-Lee which enabled information to be shared from anywhere in the world using open, decentralized internet protocols.
The initial phase of his work, typically known as web1 (Web1.0), began from 1989 to 2004. This era was characterized by primarily static, company-owned websites that offered almost no interaction among users, with people rarely producing content–which led to it being dubbed as the read-only web.
Web2 (Web 2.0) : The Read-Write Era (2004-present)
The web2 era began in earnest in 2004, as social media platforms like Friendster, MySpace, and LinkedIn emerged, creating the initial iterations of what would become a global phenomenon.
Rather than companies unilaterally producing content for users to consume, they began providing platforms with which users can generate their own content and engage with other users in peer-to-peer interactions.
This coincided with broader internet access all over the world. At the same time, a cabal of large technology companies ended up controlling an inordinate quantity of value and traffic that the current web generated. Web2 also gave birth to the ad-driven revenue model, making money out of targeted ads and monetizing user-generated content that the platforms had complete, centralized control over.
Web3 (Web 3.0): The Semantic Web (Read-Write-Own) Era
The fundamental concepts of web3 were laid out by English computer scientist and Ethereum co-founder Gavin Wood after the latter's launch in 2014.
In essence, Wood laid out the solution for a problem that the current web was struggling with: namely, the excessive permission that the internet demands. In particular, the majority of the internet that people interact with on a daily basis requires an excessive amount of trust in such a select number of private tech conglomerates, believing that they will act in their best interests. In web3, users have leeway, making it known as the read-write-own or read-write-execute era.
What is Web3? A Quick Rundown on Web3 Concepts and Principles
Web3 has become a buzzword these days, often slung around by charlatans and builders alike–risking the loss of its true meaning.
In essence, web3 simply refers to the vision of a better, more democratic internet. Like the first version of the internet or web1, web3 uses open-source protocols and technologies such as blockchain technology, NFTs, and digital currencies to devolve power back to the users and grant them greater, if not full ownership of their data.
What are the Core Concepts of Web3?
It's never easy to provide a one-size-fits-all definition of an idea that's as diffuse and multi-faceted as web3, but we can agree on several key principles that serve as its guiding lights as follows:
- Decentralization. Rather than vast swathes of the internet under the complete control and ownership of centralized tech entities, web3 envisions distributed ownership among users and builders.
- Permission-lessness. No one needs permission to participate in web3 or use its protocols. Everyone is granted the same access regardless of an person's individual characteristics.
- Enabled by Native Payments. Web3 uses digital currencies as the backbone of its economy, using crypto to transact online rather than relying on the centralized banking and payment processing infrastructure we have come to rely on.
- Gateless. Web3 does away with third-party gatekeepers to facilitate its functions; instead, it relies on decentralized economic and financial incentivization.
How Does Web3 Actually Work?
Web1 and web2 required different programming stacks; the same can be said for web3. While most of the web3 frontend development isn't that different from web2, the backend is where the difference lies.
Web3 uses a blockchain protocol at the bottom of its stack, followed by immutable smart contracts that are responsible for enabling users to interact with decentralized apps and protocols governed by code.
Rust, Solidity, and Haskell are among the leading examples of programming languages used by smart contract platforms like Solana, Ethereum, and Cardano, respectively.
On the other hand, nodes comprise an essential part of the blockchain's pillars of decentralization. They serve as the link between the frontends to the smart contracts on the backend. Rather than relying on an array of centralized data centers and servers, blockchain protocols are distributed across nodes on a peer-to-peer basis.
Lastly, crypto wallets serve as the main tool that individuals use to access web3 services, such as decentralized apps (dapps), decentralized finance (DeFi) protocols, NFT marketplaces, and other web3 services via private keys that maintain user privacy.
What Makes Web3 Important?
It's true that the hype train surrounding web3 has a lot to deal with marketing from venture capital firms and fear of missing out (FOMO). Number go up, right?
But now that the hype train has left town, web3 has never been more bullish – with the boundless talent, ideas, and effort that the builders continue to pour.
The benefits that drew millions of individuals to web3 remain the same–here they are as follows.
Web3 gives users true ownership.
Web3 isn't read-write-own for nothing. The real draw of web3 is that it gives you full, unbridled ownership of your digital assets, and their value can't be arbitrarily taken away by a centralized entity (if you use cold-storage…).
Non-fungible tokens (NFTs) are a perfect example of how web3 enables direct ownership. No single game creator, marketplace, or exchange can unilaterally rescind your ownership and take your assets away from you.
Likewise, you have the full freedom to trade your assets freely on open markets and redeem them for their fair value.
Web3 is resistant to censorship.
It's no secret that the gulf between platforms and content creators is massive; one only need look at the draconian, one-sided policies and measures platforms like YouTube and Twitch impose on the lifeblood of their income: their content creators.
Countless content creators have been de-platformed for a variety of reasons. Whether they were right or wrong is an entirely different kettle of fish.
In web3, your data is immutable, and it lives forever on the blockchain. No one platform can decide to expunge you, your reputation, and your livelihood at one stroke of the pen.
Web3 enables native payments.
Web2 is entirely reliant on traditional payment processors and banking services, excluding the unbanked (people without bank accounts) or individuals who, through happenstance and no wrongdoing of their own, were born in the wrong country. Digital currencies are a feature of web3, allowing people to conduct their financial affairs without the need for a third party to oversee them.
Web3 gives you a decentralized identity across all platforms.
In web2, you need different accounts for different platforms, all of which need to be managed on every platform you have those accounts in. Social sign-ins are now a thing, making the whole task of creating and managing accounts to use on various platforms a bit easier, but it doesn't remove the specter of censorship that looms with the central authorities that act as gatekeepers to access. You can easily lose your online life in one snap of the finger–and worse, your personally identifiable information is always at risk of a security breach.
Web3 opens possibilities with decentralized autonomous organizations (DAOs)
Web3 opens up a world of possibilities in coordinating decentralized ownership of a protocol and governing it to secure its future viability.
In essence, decentralized autonomous organizations (DAOs) are smart contracts that automate decision-making capability over a defined set of resources. Users that hold a certain token have a say in determining how resources are spent and how the DAO is run. The smart contract code automatically implements the results of any proposal put up for a vote.
DAOs are currently evolving, and so are their definitions.
What Are The Limitations of Web3?
Web3 is filled with unbridled potential–but it's nowhere close to being the magic bullet that will correct everything that's wrong with web2.
The fact is, web3 is still in its earliest stages, and there's a LOT of room for improvement. Web3 will need to overcome these limitations if it will achieve any traction in the coming years–or whether it will be relegated to yesterday's news.
Adoption and accessibility
The cost of transacting on smart contract platforms has diminished significantly, but it can cost a pretty penny over time–especially for users in less prosperous economic circumstances.
Web3 isn't ready to be used in developing nations due to the high financial and technological barriers to entry. It will take time to make web3 accessible to a wider audience besides the " echo chambers on Twitter.
The technical barrier to participating in web3 is steep. There is no way web3 will gain greater adoption without making everything related to security, technical details, and UI and UX simpler and better.
Overreliance on centralized infrastructure
For all the talk about "decentralization," the web3 ecosystem is frighteningly reliant on centralized infrastructure and service providers like Discord, Telegram, Twitter, and GitHub, just to name a few.
The scant web3-native infrastructure that exists simply isn't reliable or usable enough at this stage of the ballgame.
The Final Word On Web3
We must remember that web3 needs more time to mature and evolve as a true alternative to the internet as we know it. Many of the concepts that comprise web3 only really began taking off and materializing in the past couple of years.
It's still early days. But there's no doubt about it–we're on the cusp of creating a strictly better, more inclusive, and empowering internet with web3.
For as long as the builders continue to lay out the infrastructure that will serve as stable, robust foundation, web3 has all the promise in the world to supersede the current paradigm and welcome in the next generation of the world wide web in all its glory.