What is Web3?

Web3 is a catch-all term for the still-developing idea for a third generation of the web. To briefly review the first two generations1:

Web 1.0: Read-Only (1990-2004). At CERN, Geneva in 1989, Tim Berners-Lee was developing protocols that would become the World Wide Web, with an aim to create open, decentralized protocols that would allow for worldwide information-sharing. The first inception, now known as Web 1.0, was mainly comprised of static websites owned by companies, and there was little-to-no interaction between users, which is why it is also referred to as the “read-only” web.

Web 2.0: Read-Write (2004-present). Beginning with the emergence of social media platforms in 2004, the web evolved from read-only company-generated content to a web with user-generated content and engaging user-to-user interactions. A few companies gained control over traffic and value generated on the web, giving birth to the advertising-driven revenue model.

Web 3.0: Read-Write-Own. The vision of Web 3.0 is to evolve from earlier versions of the web, which rely on trusting a handful of private companies to act in the public’s best interests.

Web3 has emerged as the term for vision of the next generation web, using blockchains, cryptocurrencies, and NFTs to decentralize the web by cutting out the private companies who maintain control over the traffic and value generated on the web. The core ideas of Web3 include:

Decentralization. Ownership of the internet gets distributed amongst its builders and users, rather than centralized entities.

Permissionless. Everyone has equal access to Web3 participation, with no exclusions.

Native payments. Web3 uses cryptocurrency for spending and sending money online, instead of relying on banks and payment processors.

Trustless. Rather than relying on trusted third parties, Web3 operates using incentives and economic mechanisms.

Benefits of Web3:

Ownership. Web3 allows for direct ownership of digital assets through NFTs, allowing users to sell or trade digital assets on open markets to recoup their value, instead of losing them to the application or platform owners.

Censorship resistance. Data in Web3 lives on the blockchain, rather than with the owners of applications or platforms. When a content creator decides to leave a platform, their reputation travels with them to the next platform that they decide to join.

Identity. Web3 allows individuals to control their digital identities by using single, secure, censorship-resistant, anonymous logins across platforms.

As a young evolving ecosystem, there are presently several limitations in Web3:

Accessibility. Due to technological requirements and cost, Web3 is less likely to be utilized in developing nations.

UX. The user experience for Web3 is presently complicated and difficult to navigate.

Education. Web3 requires adoption of new paradigms and language, which will require user education.

Centralized infrastructure. Web3 is currently dependent on centralized infrastructure such as Twitter, Discord, etc.

1 Ethereum, 2022, “What is Web3?”