Building Web3 applications with AWS
The Web has continuously evolved since it first came into existence in early 1990s. The first version of the internet was created with static webpages providing information to users (Web1 - Read-only). By early 2000s, internet allowed users to add content and interact over various platforms (Web 2 - Read + Write). This also led to the rise of powerful platforms like social media which centralized and controlled user data. The next iteration of the internet it touted to be enabled by blockchain technologies that enable decentralization and provide ownership of the data back to the users (Web3 - Read+ Write + Own).??
Web3 is fundamentally powered by blockchain technology with several key manifestations already employed globally. Apart from cryptocurrencies (like Bitcoin), which need no introduction, blockchain is also used to build NFTs (Non-Fungible Tokens), DAOs (Decentralized Autonomous Organizations), dApps (decentralized applications running on blockchains) and smart contracts. NFTs enable digital ownership of specific items like digital art with immutable tokens created and shared on the blockchain. DAOs are headless organizations where all founding principles/rules are encoded in the blockchain and all decisions are taken through member votes over the blockchain.
True power and promise of blockchain based Web3 systems are decentralization and removal of the intermediary who provides the 'trust' to transactions or records, making the internet and internet-based businesses and systems more democratic. The business value generated by blockchain is expected to reach $176 billion by 2025 and $3.1 trillion by 2030[1]. Important blockchain development libraries like Ethers.js and Web3.js have seen almost 180% YoY growth in downloads[2], indicating the increasing development activity in this space.???
Building a Web3 app on AWS
25% of all nodes in Ethereum blockchain network runs on AWS servers[3]. AWS has created services to specifically implement blockchain based applications - Amazon Managed Blockchain (AMB) and Amazon Quantum Ledger Database (QLDB). AMB provides 60% reduction in setup time compared to hosting/creating your own blockchain network[4]. Other AWS services (not built specifically for blockchain/Web3) can also be leveraged in building a Web3 application.??
Not all aspects of an application have to be decentralized. Many Web3 applications use a combination of decentralized blockchain and general web technologies as illustrated in the solution architecture.
(1) Application front-end and UI is hosted and delivered using S3.
(2) For functions requiring server side application logic, API based access is provided, built using API Gateway service.
(3) Cognito is used for authentication and/or authorization based on the use case.
(4) The core application logic is built as multiple microservices, hosted on Lambda and ECS (on Fargate).
(5) Data which cannot be hosted on blockchain (eg: data which must be deleted on user request to comply with regulations like GDPR) is hosted off-chain in DynamoDB or Redshift.
(6) Amazon Managed Blockchain is used to provide the interface to join and access blockchain networks like Ethereum, removing the complexity of directly interfacing with blockchain networks.
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(7) KMS is used to encrypt wallet keys or credentials (which is needed to pay for write transactions on the blockchain).
(8) Microservices poll the blockchain for transaction status and SNS provides updates/notifications to users on the status of their transactions.?
(9) CloudWatch monitors the wallet balance and provides notification to users via SNS when the balance reaches predefined low thresholds.
What does the future hold for Web3?
The future of Web3 is mired in multiple challenges at the moment. Contrary to the utopian promise of decentralization, privacy and security, there is centralization (with venture capitalists, early adopters and tech pioneers), intermediaries and fraud already permeating in the blockchain ecosystem. Apart from threats to security and privacy, blockchains also face regulatory, technical and environmental – blockchain transactions consume significantly more energy than Web2 transactions – questions on whether it is the best fit technology to build the future of the internet. The robustness of community-based governance, which is a central pillar of these systems is yet unproven.
Blockchain can often appear to be a technology awaiting a genuine use case. As with all new technologies, the evolution of blockchain use cases and its adoption will need time. Some of the issues with blockchain, like environmental impact, are being addressed by moving away from 'proof of work' to 'proof of stake' framework. The impact Web3 has on the future will depend on how technology innovators and evangelists figure out ways to overcome existing challenges and identify more use cases. Irrespective of the current debate, Web3 cannot be ignored in the context of envisioning the future of the internet, purely for the enormous disruptive potential it holds.
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References
[1] https://www.gartner.com/en/doc/3855708-digital-disruption-profile-blockchains-radical-promise-spans-business-and-society#:~:text=Gartner%20forecasts%20that%20the%20business,and%20%243.1%20trillion%20by%202030