The internet was born in the early 1990s, but it wasn't until around 2006 that the world started to see a significant shift. That year saw the rise of social media networks like Facebook and Twitter, changing how people interact. And then came 2009 with Bitcoin, which ushered in an era of cryptocurrency that has yet to come close to ending.
Now we're seeing new technologies like blockchain emerge alongside artificial intelligence (AI), machine learning (ML), quantum computing (QC), and virtual reality (VR). These are all part of what is known as "web3." But what exactly is web3, and does it matter at all?
What Is Web3?
Web3 refers to a decentralized internet where users have access to their data and its use. This can be described as a move away from the traditional internet where users don't control their information on online platforms such as Google or Facebook.
Web3 has been designed to give back ownership of the internet to its rightful owners, which are web users themselves rather than companies who seek profits through harvesting user data.
Web3 allows users to have more control over their data by giving them the choice of who uses it and how they use it, among other important information such as ownership rights. This way, web users can access the internet where there is no censorship or central authorities capable of taking away one's freedom in terms of speech or anything else.
Web3 is different from web2 and web1 in that it has characteristics such as. It is:
- Verifiable - Instead of relying on a central authority like Wikipedia or an encyclopedia, in web3, information and content can be verified and confirmed by numerous users.
- Stateful - As opposed to static and non-interactive content, the web3 is capable of storing huge amounts of data and making it available for retrieval at any given time.
- Trustless - The element of trust is a vital part of any transaction. In web3, all parties follow a particular set of rules without there being a need to rely on a third party or an intermediary. This way, users can transact directly based on mutual consensus and with little or no intermediaries required.
- Open - Web3 is open and permission-less. Users can access the networks without having to create a new account or interface with a central authority. There are no closed doors or barriers that restrict users from accessing anything within web3.
- Permissionless - Web3 is open to all without the requirement for obtaining explicit consent or permissions. All you need to do is connect and use, but always respect others' rights.
- Self-governing - The web3 allows for the creation of smart contracts and autonomous systems that operate independently. This makes it possible to have a complete ecosystem built on automation and machine learning without centralized control or human intervention.
- Distributed and robust - The web3 is essentially the foundation for the idea of a P2P network where all players are equal. All operations are distributed, which helps maintain robustness even when there are no central authorities at play.
Why Does Web3 Matter?
Web3 matters because the internet as we know it is changing. The current infrastructure of centralized web applications has been proven to be insecure and unfair for end-users. For example, the social media site you use, the economy it supports, and everything in between is completely controlled by a single entity. The same entity gets to decide how much content should be shared, at what price content should be sold, which ads are appropriate for those who view them, and more. This model has been proven to effectively silence minorities as well as stifle creativity. People are being taken advantage of, and the social media giants are the ones reaping all the benefits.
Web3 embraces decentralized systems like blockchain, which is gaining more popularity due to its ability to protect user privacy while supporting an ecosystem where anyone can easily create new applications without having any technical knowledge. This means that developers can easily build new decentralized applications or other software on top of blockchain and immediately have access to features like payments using cryptocurrency, which is a significant achievement in decentralization.
The potential benefits are staggering and could fundamentally change how we think about online services such as social media networks, file storage sites, and many others.
What Is Web3 in Terms of Cryptocurrency?
In terms of cryptocurrency, web3 is a term used to describe the network where traditional internet applications have been decentralized. Bitcoin and other cryptocurrencies like it are part of what's known as Web3 (or "Web Token") because they use blockchain technology that anyone can access through their browser without any third-party involvement. This means that users can own and control their coins in a way that they wouldn't have been able to with traditional internet applications.
For example, blockchain is used for smart contracts, which are executed through cryptography rather than any central authority. This can be seen as an upgraded version of web3 because it has more benefits such as transparency, security, and efficiency within the network. Such qualities prevent censorship and provide a more equitable distribution of wealth throughout the lifetime of an application.
How Is web3 Assisting Decentralized Finance (DeFi)?
Web3 has been seen supporting the growth of DeFi. DeFi is the natural evolution of traditional finance applications to blockchain technology, which helps increase transparency and security through cryptography-based protocols that prevent any form of censorship or tampering by third parties. Through DeFi, people can conduct IRL financial transactions on the blockchain without assistance from the government or banks.
For example, EtherDelta provides a decentralized exchange where users can retain control over their funds while trading since the platform doesn't hold users' funds. This way, there is no risk of losing anything since all transactions are stored on Ethereum's blockchain, and it can only be accessed with a private key that you alone own.
What Does This Mean for Developers?
For developers looking to build decentralized applications (Dapps), web3 means opportunity because they can take advantage of the blockchain space instead of traditional web-based applications. This is because there are various advantages, such as increased security, transparency, and trust between users.
Developer tools have also been made available for those looking to build Dapps, including Ethereum's Solidity language, which can be used by developers who are already familiar with Python, Javascript, or C++. This way, they can easily learn how to build decentralized apps without having to start from scratch.
What Is the Future of Web3?
The future of web3 is bright, and it has the potential to change the way we interact with each other online. This means that developers can build applications on top of blockchain technology which could be used for almost anything such as social media, file storage, or even something more complex like a decentralized version of Uber where drivers pay their commission fee rather than the platform taking a cut of their earnings.
The future of web3 and decentralized applications is also still uncertain. However, we can be sure that there will be significant improvements in the near future with obvious benefits for developers.
Take Away
Web3 is a term used by many crypto enthusiasts that describes a decentralized internet where users have more control over their data and also helps save money on third-party fees if you wish not to use centralized applications.
Web3 is the next step in terms of internet evolution, and it also allows developers to build decentralized apps without any hassle or need for server infrastructure.
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