Blockchain is referred to as the Distributed World Computer. It enables a concept called Web 3, that promises to transform the entire internet, this time from the ground up. This single-use case by itself makes Blockchain one of the most important inventions of this century.
The journey of the Web
Web 1: Initially we had stand-alone computers. Web 1 started with the advent of the internet. Centrally stored data can now be transferred and shared between two parties. This gave easy access and enabled replication of data, however at a cost of data security! Every time we send data over the internet, the server service provider takes over control, and the risk of data piracy increases.
Web 2: Web 2 brought with it digital commerce, all moderated by a central trusted third party. Social Media platforms like Facebook and digital marketplaces like Amazon are Web 2 pioneers. People are now able to monetize their content or buy and sell goods. However, the transfer of money is still controlled by big corporations. Fiat Money is used as a medium of transfer. All digital transactions remain non-native and just a representation of the fiat value. Web 2 also created the much popular P2P Platforms. However, these platforms also had a single point of failure.
The Web 2 internet has various drawbacks. It is a capitalist network where the user gets exploited. Some notable problems include:
· Individuals do not control data
· There is no native settlement currency (with inflation control)
· Server-based data storage creates a single point of failure
· Monetization of individual’s data by third parties
· High cost of information handling
Web 3: Web 3 brings in trust.
Source: Blockchain Hub
Blockchain ensures decentralized storage of data. It also creates a native settlement layer, all orchestrated through smart contracts. The internet suddenly has its programmable economy! Blockchain enables Web 3. The governance happens within the network and the need for an external third party is eliminated. This saves a lot of money and brings in trust. People now can settle agreements on the web without the need of trusting each other personally. Web 3 is not a quick front-end fix. It’s a proper back end overall. All real-life apps will one day move to the blockchain to become a dApp.
The payment system on the internet is not creator focussed. It is focused on the companies that run the platforms. For example, in YouTube, the money from the advertisers does not pay the creators directly. YouTube pays the creators. Who knows what their margins are? Do they talk about operating costs? What if blockchain can provide safer data storage at one-tenth of the cost? What if blockchain can also pay the viewers for viewing. This is a paradigm shift. Similarly, Facebook sees your search trends, understands your emotions, and directs focussed advertisements towards you. They have often been accused of selling your data. Enter Web 3 wallets. Wallets like Metamask, Sollet, Yoroi, Polkadot.js enable us to perform transactions natively over the internet for the content we consume. Brave Browser pays us for the advertisements we see. Some important applications include.
· Social Media
· Shopping Services
· Music streaming
· Bookselling through NFTs
What will happen next?
Web 3 has already created a strong foundation. It is however facing problems like lack of user adoption, and also UX-related challenges. Interoperability has still not been properly solved. However, these are temporary problems. These will be fixed in the long run. We will soon see an array of big organizations testing their platforms in the blockchain. This includes social media, streaming platforms, or digital marketplaces. As this is an entire paradigm shift, showing the value to the bigger population will take time. Till that time new projects will come up and build new features. We are as such still early and in an envious position to see the universe of Web 3 expanding in front of our eyes.
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