Web 3.0 and Blockchain

The term Web 3.0 has been buzzing around for some time now, but what exactly is it? Looking at the history of the internet, we can trace it through several generations.

Web 1.0 was the beginning of the internet and the worldwide web. It was basically a global library where everything that existed in print was dumped into a giant online database. Then came Web 2.0 with companies like Google, Facebook and Twitter which allowed us to create our own content and self-publish it to the internet. As that was happening, companies began to realize that the data online had real value. The internet came to be viewed not so much as a database, but as a databank. Web 3.0 is the next generation of the internet which allows for the monetization of that data to provide more personalized solutions. Every day, companies are developing more sophisticated AI to interact with the so-called Internet of Things, with the goal of having systems and bots seamlessly know everything about us in order to provide a more customized experience. But imagine if there was a way to harness the latest technology to actually increase personal engagements rather than reduce them.

One of the incredible opportunities that the internet has opened up is the ability for ordinary people to have a global reach. Whether communicating through email or doing business online, people are no longer limited by their geographic location. Over the past several years, the growth of influencer marketing has shown the power of individuals to monetize their social media feeds. In reality, everyone today can be viewed as a micro-influencer. When you upload a picture to your social media feed, it has an impact on your followers, even if they’re just your family and friends. You might be simply showing off your new outfit, on sitting on the hood of your car, but for brands, those simple acts and pictures have real value. In the future, brands will be able to compensate people with micropayments, allowing them to generate income from what they’re already doing.

Currently, web internet business models have consisted of massive centralized entities that exact value from services. This traditional business model manifests itself in the form of massive siloed-centralized platforms with huge user bases. These are the Facebooks, Ebays, and Ubers of the world.

These companies collect revenue by building a massive network of users in which most of the value in the platform comes from the users. There is nothing uniquely valuable about Facebook other than the amount of users on its platform. If you could eliminate the centralized platform which owns the network and allow the users to interact with one another directly through a peer-to-peer decentralized network, it returns all of the wealth generation back to the users of the network rather than the centralized Facebook or Uber shareholders, employees, etc.

For example, in a decentralized business model, users of the Ethereum blockchain are essentially the owners of that blockchain. Owning an Ethereum token gives a user the right to interact with that protocol and access its utility.

Large tech companies were able to transition from minor disruptions in the past such as the transition from desktop to mobile. However, this disruption did not upend the companies’ revenue models. Now with a disruption of our current magnitude, large tech companies cannot seamlessly transition when their entire business model is upended. As a business, when you experience competition from a peer-to-peer decentralized protocol it is nearly impossible to compete due to the fact that these protocols have no cost structure.

It is important to understand blockchain technology is not simply currency. This is a misleading metaphor that underscores the true potential of this technology. Paying someone on the internet is merely a subset of what is possible.

With this new internet web 3.0 stack, a decentralized Twitter or Facebook are not the most interesting projects. The real question is ‘what unique applications can be built as a result of decentralization that were not previously possible?’ In actuality, these projects will yield the greatest ROI and have the ability to have the most societal impact.