Written by Prakriti Panwar, a first-year undergraduate student
Simply put – Web 3.0 refers to the third generation of the internet. It is the successor of Web 1.0 and Web 2.0.
To understand exactly what Web 3.0 is, we first need to understand what Web 1.0 and Web 2.0 are.
The difference between Web 1.0, 2.0 and 3.0
According to Geeks for Geeks, Web 1.0 was the first stage of the World Wide Web evolution. This approximately lasted from 1991 to 2004. Online activity and web surfing during this time involved navigating static web pages and this phase was characterized by decentralized and open protocols.
This basically means that the only purpose of the internet during this time was to provide information to the end user. The content was created and provided by a limited yet varied group of creators. Most internet users during this phase were consumers and not creators of content.
Web 2.0, which still continues, is the second stage of the World Wide Web and is more interactive.
It is also known as the “participative social web” This phase is characterized by increasing centralisation with proprietary controls. This means that services (such as podcasting, blogging, and social networking) are largely provided by a few dominating commercial companies (like Google, Microsoft, and WordPress, etc) and now everyone, both consumers and producers, can participate in content creation.
Web 3 is the new phase of the internet that is based on decentralized applications and public blockchain technology.
Image source: nanowerk
So, what do decentralization and public blockchain mean here?
A decentralized digital economy is characterized by the absence of trust and permission. And that is a good thing!
Decentralized, as the word suggests, means transferring control to several different individuals. In the context of Web 3, it means that instead of accessing the internet through the services of companies like Google, consumers can do it by themselves, without any middlemen to “trust”.
As Cointelegraph puts it, consumers will be able to own and govern sections of the internet. One significant feature of Web 3 is that it does not require the “permission” of certain central authorities to decide which services we consumers get access to.
Public blockchains are a kind of record-keeping system which are best known for facilitating cryptocurrency transactions. A public blockchain can be accessed by everyone and again, is “permissionless.” In public blockchains, there isn’t one single organization that controls it. And though a public blockchain is open to everyone, it is very secure because the data cannot be modified once validated and everyone is anonymous in nature.
This is an example from Nanowerk that will better help us understand the implications/uses of Web 3.0 :
“Mike wants to find out his ancestry. He swabs his mouth or nose and sends that to a company that analyzes it. He pays $50, and after a few weeks, gets information that he is half Irish, 25% German, and so on, and so forth. That information is basically now resting with the company that did the genetic profiling of Mike. They probably are going to monetize that in many different ways, e.g. selling their collected data in bulk to a pharma company. Mike gave up his essential data, his genetic makeup, just because he wanted to know his ancestry, and other people are making money out of that.
But with Web3, we have a data marketplace, and that data is not the genetic test company data. It is still Mike’s data and he is able to basically list that as a non-fungible token (NFT). As a data parcel, it can be divided or it can be access controlled. So it means that Mike can give access to certain portions of his genetics. And he can give that to only people or the company that he feels will meet the profile that he would like to work with, and each time someone accesses or uses that data, Mike will be paid. And Mike can basically dictate how that data is used, or how long, for what application, by whom, and all that.”
Uses and advantages of Web 3.0
One of the biggest advantages of Web 3.0 is the absence of intermediaries. Web 3.0 is expected to protect the privacy of consumers because middlemen and intermediate organizations are the entities that collect consumers’ data. In their absence, “virtual transactions” can take place directly between the parties concerned.
All this has given rise to something known as ‘DeFi,’ an abbreviation of ‘decentralized finance.’ It is a component of Web 3.0 that involves executing secure financial transactions without the need for banks or governments.
Presently, the use of Web 3 is already visible in the form of NFTs (Non fungible tokens). NFTs can be thought of as a ‘token’ that gives access to financial interests, music, and art that users purchase for basic usage rights or other speculative activities.
What are the downsides of Web 3.0?
As of now, three major disadvantages of Web 3.0 stand out.
- Firstly, Web 3.0 is decentralized but as Forbes put it, “centralisation exists for a reason.” With no regulation at all, financial markets and economies altogether are at risk of disruption. While this absence of regulation and intermediaries is predicted to protect data, it might also lead to a rise in cybercrimes.
- Secondly, the new features of Web 3.0 might seem overwhelming to the common public and people might find it a little hard to cope with these changes.
- Lastly, all existing applications will need major upgrades to still remain popular. The logistics of the same are quite time-consuming and labour-intensive.