You might have been hearing a lot about Web3 recently. This is the latest internet technology, but do you know what Web3 is? How does it relate to cryptocurrency? What changes is it bringing about? This article will cover everything you need and want to know about Web3. Let's dive in!
What is Web3?
Before diving into Web 3 (or Web-3.0), let’s look at its predecessors: web 1.0 and web 2.0. Our first encounter with the world wide web was Web 1.0. It was a creation by scientist Tim Berners-Lee in 1989. Within it, it provided one-way information from websites to users. Back then, more websites were static web pages connected through hyperlinks. This got the name “read-only internet.” As 2004 rolled along, so did Web 2.0, driven by mobile technology, social media, and cloud computing. Its most significant breakout was the interaction. In this stage, information started to flow both ways. Thus, users were able to interact with sites and also with other users. As a consequence, Web 2.0 received the name “read-write internet.”
Web3/Web.3.0 is the next stage of the evolution of the web, also known as the "read-write-interact web." While reporter John Markoff coined the term in 2006, it is only starting to take shape. The idea behind Web3 is to decentralize and interconnect data. This will lead to more personalized experiences. Web3 leverages a vast amount of recently released technologies. These include metaverse, edge computing, blockchain, Artificial Intelligence, and IoT to function. We know this explanation may leave you with even more questions. But don't worry! We're sure you'll find the answers to these below.
How Does Web3 Work?
In a previous article, we discussed blockchains relating to cryptocurrencies and NFTs. In summary, a blockchain is a public ledger or global registry. Often, it’s used to verify and confirm transactions through digital signatures. This same technology founded Web3. Instead of on limited servers, data is in decentralized storages. Further, it gets spread through the internet.
Let's take a closer look. With Web 2.0 apps, users interact with websites' front end. In turn, it communicates with the back end, and the latter contacts the sites' database. Inhere, all code is in centralized servers and makes its way to users through browsers. Meanwhile, with Web 3.0, there are no centralized databases or servers to hold all this Back-End logic. Here, blockchain builds apps on decentralized state machines. As a result, apps are then maintained by anonymous nodes on the web.
On user access, people need a seed to use the decentralized web. Also, web browsers are still required to access the internet. Yet, instead of Chrome, Web3 has Brave. Web 3.0 or decentralized apps (dApps) are already running on the Ethereum Blockchain. Some of these include Dark Forest and Uniswap. We’ll look closely at some real-life examples of dApps in this article.
Is Web3 a Crypto?
As we've mentioned, Web3 and Crypto connect through blockchain. So, any confusion is more than understandable. Web3 apps may have associated tokens, usable as currency to pay for services. But also, users can use these tokens as voting power to make decisions over the app's development. These tokens are like cryptocurrencies, such as Bitcoin. So, they can be subject to appreciation and inflation. To sum up, Web3 is not a cryptocurrency but connected to it, as it depends on a blockchain and entails tokens.
Is Web3 Secure?
Users in Web3 use private keys managed by wallets to sign transactions. The fact that there are no intermediaries in Web3 has a lot of advantages. But, it also means there is no one to help in the event of attacks or compromised private keys. So, is Web3 secure? The short answer is: not yet. There have been various hacks over the last few months. These resulted in the robbing of hundreds of millions of dollars in cryptocurrencies. Some of the affected companies were Ethereum and Solana. Although there are security issues, this was the case for Web 1.0 and Web 2.0 when they first came about. Over time, both overcame their existing vulnerabilities. That will most likely happen with Web 3.0 as well. As for now, security companies like Forta and Securify are focusing on these problems. It might be worthwhile to wait and see how things progress.
What are Web3’s Features?
1. Open-Source. Web3 is open-source software. There's an open community making it accessible to everyone.
2. Trustless. Here, users can interact in public and private ways. In both cases, there are no intermediaries. Thus, it guarantees less exposure to risks.
3. Ubiquitous. This feature will apply at any time and everywhere. Due to this, it aims to make the internet accessible to everyone.
4. Permissionless. This aspect is quite relevant. In sum, users and providers won't need permission to access it.
What are the Pros and Cons of Web3?
Pros of Web3
1. Transparency. No matter what blockchain users may choose. They're able to track their data and inspect the code behind platforms.
2. Intermediaries. There are no middlemen charging fees for services. That's because, with decentralization, providers and end-users get a first-hand connection.
3. Data Privacy. Data encryption gives end-users more control over their data and ensures their privacy. This means users have complete ownership of their information. Further, it's only shared with their permission and case-by-case basis. As a consequence, access to users' data won't be possible. Companies like Facebook or Amazon will no longer be able to use and resell it to advertisers.
4. Seamless Services. Decentralization also means that data is accessible in any circumstance. To ensure this, data gets distributed over various nodes to provide redundancy. This type of backup solves any service interruption issue related to Web 2.0. Moreover, account suspension and denial of distribution services will become less likely.
5. Single-Profile. With Web3, users can use a single profile on all platforms. This means no time wasted when you sign up for a new forum.
Cons of Web3
1. Advances. Computers must meet specific criteria to appreciate the benefits of Web3. As a result, less advanced devices won’t be able to use it. This also means it is not ready for widespread adoption yet.
2. Obsolescence. Web 1.0 tech won’t be able to adapt and will become obsolete.
3. Functionality. Web 3.0 won’t be accessible for new users to understand, so they might be hesitant to use it at first. Besides its need for advanced devices, its popularity will likely grow slowly.
What is Web3 Used For?
You may not have seen Web3 in action, but you know it already exists in various areas. These include education, virtual help, exchange services, and social networking. Let’s take a look at some examples!
Web3 on Siri
This is the most well-known example of Web3 in action. As you might know, Siri is Apple’s virtual assistant. It uses voice recognition software to communicate with users.
Web3 on IDEX
This decentralized exchange is used for trading ERC-20 tokens. IDEX is Ethereum based. Also, it requires a MetaMask wallet.
Web3 on Steemit
The decentralized reward platform runs on the Steem social blockchain. Steemit is a blogging site that rewards its bloggers and content creators in crypto.
Web3 on Everledger
Everledger offers technology solutions aimed at increasing transparency and accountability in supply chains. The company uses Web3’s data encryption feature to protect data and cut the risk of fraud.
Web3 on Decentraland
Decentraland is an online virtual world or metaverse. Its platform allows users to socialize, play games, and attend events. Further, it has its cryptocurrency called MANA. As you can see, dApps already cover a wide variety of fields.
web3-react is a Web3 framework. Nowadays, it's used to build decentralized apps on the Ethereum blockchain network. Like React, the framework is simple, easy to use, and extensible. It supports providers such as MetaMask, Frame, and WalletConnect. Further, it can work with other wallets as well.
web3-react uses React architecture to help you build the Front-End of a dApp. Yet, web3-react within itself does not have a traditional data architecture. One of its main benefits is to write plugins to the blockchain programmatically. Also, it's perfect for building robust, extensible, and systematic dApps. web3-react is also relatively easy to install. Other Web 3.0 development frameworks include Truffle, Hardhat, and Brownie.
Why is Web3 Important?
The short answer to this question is that Web3 is an opportunity to share value across an open network. It means private monopolies such as Facebook and Airbnb will no longer dominate. As a result, this will give way to many profit centers.
But this is only one aspect of Web3. We've already mentioned a few important reasons that showcase its importance. With Web3, users have ownership and control over their data. Also, sociological or demographic factors won't be barriers to access or interactions. Aligned with the latter, service interruptions will reduce drastically. Thus, Web3 will increase the scale of human and machine interactions. Users can interact with any person or machine in the world without needing mediators. This, in turn, will open new possibilities for businesses and business models. Further, into the future, Web3 has fantastic potential. In turn, it can create more efficient societies and organizations.
Web3 is full of incredible possibilities but does come with some risks. It has many advantages and can improve how we interact with the web. Moreover, it gives us independence from big-tech companies, broadening our horizons. Yet, we're looking forward to the outcomes of its possible risks or disadvantages. We hope this article has helped you understand what Web3 is, how Web3 works, and why Web3 matters. Are you ready to dive into the next stage of the internet?