Introduction to Web3
The web was born in the early 1990s, yet it had not been till around 2006 that the world started to see a substantial shift. That year saw the increase of social media sites like like Facebook and Twitter, transforming exactly how people interact with each other. Then came Bitcoin in 2009, which introduced to the world cryptocurrency, which completely transformed the concept of money and how it was perceived.
Now we’re seeing new innovations like blockchain arising alongside artificial intelligence (AI), Machine Learning (ML), Quantum Computing (QC), and Virtual Realty (VR). These are all component of what is referred to as “Web3.” But what exactly is web3, and does it matter in any way?
What Is Web3?
Web3 is a decentralized web, where individuals have access to their data and its usage. This is an approach away from the conventional web where individuals don’t regulate their information on online platforms such as Google or Facebook. Web3 has actually been developed to return ownership of the web to its rightful owners, which are the users themselves as opposed to large companies like Google or Facebook who make huge profits selling collected user data to their advertisers. Web3 allows individuals to have more control over their information by providing them the option to choose who uses their data as well as how the data to be used, among other vital details such the duration of holding of their data and so on. This way, the users can access the internet where there is no censorship or central authorities capable of taking away one’s freedom of speech or privacy of own data.
Web3, designed for peer to peer, decentralised distributed network is different from web2 and web1 in many different ways as explained below:
Verifiable- Instead of relying upon a central authority like Wikipedia or an encyclopedia, in web3, info and material can be validated as well as confirmed by many users.
Accessible- As opposed to static and non-interactive content, the web3 can store huge amount of data in distributed network, making it available for retrieval at point of time.
Peer To Peer (P2P)- The element of trust is an essential part of any kind of transaction. In web3, all parties adhere to a certain terms and conditions coded in a contract called smart contract, is stored in blockchain without any need to depend on a 3rd party or an intermediary. By doing so, individuals can negotiate directly with each other (peer to peer) without the need of any intermediary.
Open- Web3 is an open as well as permission-less web. No need to follow any account opening or verification procedure to access any service. In short, there are no shut doors or obstacles that restrict customers from accessing anything within web3.
Self-governance- The web3 permits the production of smart agreements as well as self-governing systems that run separately. This makes it possible to have a complete ecosystem built on automation and artificial intelligence without systematized control or human treatment.
Why Is Web3 So Special?
Web3 no doubt is transformational. The web applications that we currently use are centralized and highly insecure and favours the application providers not the end user. As an example, the social media site you use, even though gives you the access to its application free, sells your personal data to its advertisers at a price that it decides without sharing any profit of its profit with you. It also has the final authority to decide the content of your post and what you could and could not post on your social media profile. A handful of companies are reaping huge rewards at the cost of the ordinary people, the users of these services.
Web3 embraces decentralized systems like blockchain, which is getting much more appeal due to its capacity to secure customer privacy while sustaining an ecological community where anybody can conveniently create new applications. This means that developers can conveniently build new decentralized applications (DAPP) or various other software applications on blockchain and immediately have access to attributes like payments using cryptocurrency, which is a considerable accomplishment in decentralization.
The possible advantages are incredible and might basically transform exactly how we consider online services such as social media, data storage, banking, gaming and every other services currently available in Web2.
Web3 and Cryptocurrency
As discussed earlier, Web3 is a term utilized to describe the decentralised network in internet. And this decentralization is possible by blockchain technology. Bitcoin and all other cryptocurrencies use the same blockchain technology that will be powering the entire Web3. As a matter of fact, blockchain technology was first used in Bitcoin by Satoshi Nakamoto, the founder of Bitcoin. Hence, Bitcoin and various other cryptocurrencies like it belong to what’s referred to as Web3 (or “Web Token”) today.
Though the concept of blockchain is yet to be entered the mainstream, not many people know that any individual can access the blockchain through their internet browser with no third-party involvement. Web browsers like Brave, has been designed for Web3, enabling the users not only complete privacy but also compensates the users based on their time spent to watch the advertisements. The browser also integrates crypto wallet into it so that the user keeps his own money instead of a bank. This suggests that customers can own as well as regulate their coins in a manner that they wouldn’t have been able to with typical web applications.
In the world of Decentralized Finance (DeFi), blockchain is utilized to create and store the P2P agreements called Smart Contract, which are performed via cryptography as opposed to any kind of main authority. This can be seen as another variation of web3, because it has even more advantages such as transparency, security, as well as effectiveness within the network, avoiding censorship and enabling more equitable distribution of wealth within the peers.
How Is web3 Assisting Decentralized Finance (DeFi)?
Web3 has actually been seen sustaining the growth of DeFi. DeFi is the natural advancement of conventional financing applications to modern blockchain enabled DApps (Decentralized Applications), which helps increase transparency and also protection with cryptography based procedures that protect against any kind of form of censorship or meddling by 3rd parties. Through DeFi, individuals can borrow money or buy insurance policy on the blockchain without help from the federal government or financial institutions.
As an example, UniSwap the largest decentralized exchange (DEX) offers its protocol to its customers where they have absolute control over their funds while trading, since the platform doesn’t hold customers’ funds. This way, there is no danger of shedding anything given that all transactions are stored on Ethereum’s blockchain, and it can only be accessed with a personal key that you alone know.
What Does This Mean for Developers?
What Is the Future of Web3?
The future of web3 is bright, as well as it has the potential to transform the means we engage with each other online. This means that developers can build blockchain based applications which could be made use of for virtually anything such as social media, file storage, or even something much more complicated like a decentralized variation of Uber where vehicle drivers pay their compensation cost as opposed to the system taking a cut of their incomes.
The future of web3 and also decentralized applications (DApps) still uncertain. However, we can be certain that there will certainly be significant demand in the future for decentralized applications as both individuals and governments are becoming increasingly wary of personal data security and cybercrimes. People are becoming more and more aware of polarization of wealth with a handful of companies.
Web3 is not the future but the present. A record $30 Billion poured into crypto in 2021 (Fortune.com). Solidity, the programming language used for smart contracts has become one of the highest paid skillsets in IT industry. So, it’s the best time to get involved in the industry to reap the early rewards.
By Som Prakash