What is Web 3?

Before we get to Web3, lets understand what Web 1.0 and Web 2.0 are. These are not technical specifications, but the evolution of the internet as we know it.

Web 1.0

Web 1 is essentially the first generation of the internet - static text pages (rather than dynamic HTML) which you viewed passively. This was the age of dial-up internet. When a users requests for a webpage from a particular website, (the URL), the web browser retrieved the specified content from the web server (using HTTP) and then displayed the page on the user's device.

The first web browser in the 1990s – the WorldWideWeb was built by Tim Berners-Lee using a NeXT computer – which would browse ‘http:’, ‘news:’, ‘ftp:’ and local?‘file:’?spaces. We later had the Mosaic browser (1993), Netscape Navigator (1994) and Microsoft Internet Explorer (1995). The screenshot below is what the first web browser looked like in 1993.

?Web 2.0

The ubiquitous Web2 is where we are now – the Internet as we know it today. With the evolution of the web and broadband connectivity, early browsers have expanded their HTML, CSS, JavaScript and multimedia capabilities, including using web apps. This current phase is a participative, inter-operable social internet with data intensive and customised user generated content, particularly blogs and social media like Facebook, YouTube, Instagram and TikTok.

The term Web2 was popularised in 2004 by Tim O’Reilly at their conference where they set out the ‘Web as a platform’ definition, and essentially customers are building the business for you.

The word cloud below sets some of the meta data that gets covered in Web 2.0,

Web 3.0?

So now lets get to what Web3 is. This graphic is an easy reckoner on the evolution of the web.

Web3 uses a stack of technologies, based on decentralized blockchains, that enables new business and social models. Users own their data, identity, content and algorithms and participate as “shareholders” by owning the protocols tokens or cryptocurrencies. That ownership shifts power and money away from centralized Web 2.0 “gatekeepers,” such as big tech companies and governments. (Source: What is Web3, Gartner)

The term Web3 was popularised by Gavin Wood, the co-founder of Ethereum, who argues that centralisation is not socially tenable long term. He does makes a fairly strong statement that we should Consider Web 3.0 to be an executable Magna Carta — “the foundation of the freedom of the individual against the arbitrary authority of the despot.” (Source: Why we need Web3 - Gavin Wood, Medium)

Nothwithstanding his comment, Web3 is a far more specific paradigm that provides clear solutions to specific shortcomings of the Web 2.0 internet. It is a reaction to the ecosystems that large media platforms today have created – which has users worried with their limited ability to control their data and privacy. Web3 subverts that model because it directly addresses the issues of ownership and control. Web3 covers verticals like DeFi (decentralised finance), NFT’s (non-fungible tokens), gaming, metaverse, and more.

What makes Web 3 special?

The graphic below provides a good understanding of the 5 important aspects which make Web3 unique.

In addition, the control over content monetisation is key to the Web3 economy. This visual provides a good description of the value add over Web2 for a content creator. This is the underlying reason for the NFT (non-fungible token) boom.

Web 3 challenges

Web3 is still in its infancy and there are still large questions to address.

Like it or not, centralization still works in Web3. OpenSea, currently the largest NFT marketplace, is fundamentally a centralized marketplace that simply facilitates transactions on the blockchain. Coinbase is another example of a centralized exchange that enables transactions of cryptocurrencies. In both cases, these intermediaries take service fees on transactions just like any other Web 2 marketplace. So the question being raised is whether there is true decentralisation? Or is it really progressive decentralization?

The concentration of ownership in the hands of a few as against the general public is another gripe. Most hot new Web3 startups and their crypto tokens are majority owned by VCs (venture capitalists). Jack Dorsey famously tweeted that you dont 'own' Web3 - its the VCs and their LPs who do and it is ultimately a centralised entity with a different label. This strong statement did attract a lot of attention and detractors - including Marc Andreesen (of A16Z), Brian Armstrong (CEO of Coinbase) and Tyler Winklevoss (of Gemini) who disagree.

The future of Web3 is still being played out and we definitely have a lot to watch out for. Follow me to stay connected on topics related to Crypto and Web3.