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Web3 is reshaping the internet, but what does it mean for you? Dive into the future where control shifts from big tech to the users themselves.
Web3 is a term you’ve likely come across a lot recently. It’s a buzzword on social media, forums, and tech talks, hinting at a revolution in how we use the internet. Web3 represents the evolution of the web.
This new phase aims to transform our digital spaces, making the internet more responsive, personalised, and secure. It’s about handing control back to the users, away from the big tech monopolies. This means a future where you have more say over your data, your online presence, and how you interact with the web.
Recognising Web3 and its possible effects on an everyday person is crucial. So, let’s dive deeper into how Web3 is shaping up to redefine our online world. Keep reading to understand the basics of Web3 and what it means for you.
Web 1.0
Web1, or Web 1.0, marks the internet’s initial phase, primarily spanning the 1990s and early 2000s. This era introduced us to the internet as a collection of open protocols. These protocols allowed for the free exchange of information, not confined to any single entity or organisation.
During Web1, the internet was a place for reading web pages. It wasn’t as interactive as today. People visit sites like Wikipedia to gather information without a way to contribute or express themselves. E-commerce and academic research also began to take shape, using the internet more extensively.
Web1 came at a time when dial-up connections were the norm, and mobile phones weren’t yet part of our daily lives. Few users created content; most users just consumed it. These creators, mainly developers, built simple websites using text and images. Interactivity was minimal, downloading a song could take hours, and video streaming was unheard of. It was the early days of the internet era, only a select handful can access.
Source: Flitpay
Web 2.0
Web 2.0 transformed the internet in 2004, turning it into a space where you could both consume content and create it. The spark of Web 2.0 began with the birth of social networks.
Early players like Yahoo Chat Rooms and Orkut paved the way for a digital community. You can upload a photograph and have conversations about it with other users. The ability to express oneself online began with this.
Platforms such as Facebook, YouTube, and TikTok took it a notch higher, enhancing two-way communication to a multi-way dialogue. This opened doors for many to participate in events like concerts or study groups digitally.
This period also saw technology giants like Meta (formerly Facebook), Twitter, Google, and Amazon capitalise on social media to consolidate power, creating an infrastructure that centralised a vast portion of online interaction and content distribution within a few dominant platforms.
Web3
Over the past 20 years, data has grown at an incredible rate. The transition from static web pages to dynamic and interactive content has led to a rise in the need for advanced technologies such as analytics platforms, databases, and search engines. These advancements have made it possible to handle and analyse enormous volumes of data more skillfully.
We are entering the Web3 age as we make our way through this digital revolution.
Here are the core aspects of Web3 that make it an effective tool for daily life.
Decentralisation:
Web3 envisions a decentralised internet that makes use of blockchain technology. This innovation aims to give users more control over their data, as opposed to the current system dominated by tech giants.
Blockchain is the technology at the core of web3, allowing for safe, transparent transactions without requiring centralised control. It means data can be stored and transferred in a way that is open for verification but protected from unauthorised changes.
Smart contracts
Web3 additionally presents smart contracts, which are self-executing agreements with terms integrated directly into the code. Deals become more reliable and efficient with these contracts’ automatic execution and enforcement.
Digital assets and tokens
Utilising digital assets and tokens is another essential element. These range from cryptocurrencies to non-fungible tokens (NFTs), allowing for a wide array of transactions and ownership in the digital space. These assets represent a shift towards users owning digital content outright, rather than it being controlled by a few large entities.
In essence, web3 combines the decentralisation of web1 with the interactive capabilities of web2. It promises a future where users have greater autonomy online, participating in and benefiting directly from the ecosystem they help to build and maintain.
Source: CNBC TV18
How do Web 2 and Web 3 differ?
Web3 and Web2 differ fundamentally in their approach to control and trust. In the Web2 era, big technology companies hold the reins, managing data, content, and transactions. Customers must trust these corporations with their personal information because of their centralised approach.
Web3, on the other hand, shifts control back to users. It decentralises control by utilising blockchain technology, giving users ownership and management of their data. This change could revolutionise how the internet is used, affecting everything from information management to monetisation.
The concept of trust also evolves from Web2 to Web3. Web2 relies on trust between parties in a transaction, often facilitated by a central authority. Web3 removes the need for this trust by using technology that only allows transactions to proceed if specific criteria are met, ensuring data integrity and security.
Consider the example of publishing and monetising digital art. In the Web2 world, artists often upload their creations to platforms controlled by large companies. These platforms can sell or display the artwork, often taking a significant portion of the profits and controlling how the art is used.
With Web3, artists may create non-fungible tokens (NFTs) out of their artwork by using blockchain technology. This procedure creates a distinct, blockchain-verifiable identity for every work of art.
Artists may protect ownership rights, keep more of the revenues, and sell their work directly to customers without the need for middlemen. Moreover, smart contracts can ensure artists receive royalties for every subsequent sale of their work, providing ongoing income from a single piece of art.
Source: Guarda wallet
Impact of Web 3 on the Common Man
Web3 is set to make ground-breaking changes to everyday lives. Here are five use cases highlighting its impact:
- Decentralised Finance (DeFi): DeFi offers enhanced privacy and financial freedom. It allows users to execute transactions directly with others, bypassing traditional financial intermediaries. This enables individuals to securely own and trade their digital assets, such as artwork and virtual real estate, through blockchain-based systems.
- Decentralised collaboration: Platforms can help workplaces collaborate globally without relying on centralised servers. Web3 offers tokenized incentives that reward people for their contributions with tokens that have real value. This enhances productivity and collaboration by incentivising individuals.
- Decentralised social networks: Web3 enables decentralised social interactions, prioritising user privacy and data ownership. It empowers users to form digital communities with shared governance and directly influence decision-making.
- Micropayments for content: Web3 enables direct micropayments for content creators, providing a sustainable income stream and promoting quality content for consumers by bypassing traditional advertising models.
- Secure voting systems: Web3 can revolutionise how voting is conducted by creating secure, transparent, and tamper-proof systems. This ensures the integrity of the voting process, allowing for more trust in democratic systems and potentially increasing participation in elections.
Drawbacks
Evolving regulation
The decentralised nature of Web3 complicates the regulation of content and user behaviour, potentially allowing harmful material to circulate more freely without clear governance. Authorities around the world are still figuring out how to govern this new space, focusing on consumer protection, the legality of blockchain contracts, and financial regulations.
User experience
Web3 applications, being relatively new, often fall short in user experience compared to the more mature Web2 services.
Consumer protection
The collapse of various Web3 projects like Porsche’s debut into the NFT world with their iconic 911 model aimed to make a significant impact in the Web3 space. However, the launch fell short of expectations.
Despite being marketed as a pioneering venture for fans to own a digital piece of luxury, only 25% of the 7,500 NFTs were sold by the day after the launch. This led Porsche to stop the mint and reduce the total to 2,363 tokens.
These failures have underscored the urgent need for improved protections for consumers and investors, highlighting vulnerabilities within the nascent Web3 ecosystem.
Cost and energy
Operating on blockchain technology means Web3 inherits its high costs and significant energy demands. These factors can limit the practicality and sustainability of Web3 applications.
Hardware requirements
Full participation in Web3 may necessitate the latest technology, putting those with older devices at a disadvantage and potentially excluding them from the benefits of Web3.
Bottomline
Web3 represents a paradigm shift towards a more decentralised and user-empowered internet. While it brings promising advancements such as enhanced privacy, financial freedom, and direct ownership of digital assets, challenges like evolving regulation, user experience, and energy demands persist.
Dealing with these intricacies will be key to realising Web3’s full potential for everyday users, offering a glimpse into a future where the internet becomes more inclusive, secure, and user-centric.
DISCLAIMER: This article is not meant to be giving financial advice. Please seek a registered financial advisor for any investments.
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