What is Web 3.0?
The World Wide Web is the inaugural and foundational layer for internet use, providing website and application services. Web 3.0 represents the third generation in the evolution of web technologies.
There isn't yet a canonical, universally accepted definition, as Web 3.0 is still evolving and being defined.
However, it will strongly emphasize decentralized applications and extensively use blockchain-based technologies, machine learning, and artificial intelligence (AI) to enable more intelligent and adaptive applications.
Another aspect of the emerging definition of Web 3.0 is the notion of a semantic web. Tim Berners-Lee, the creator of the Web, advocated for integrating semantic technology into the Web.
Transitioning from the original Web 1.0 to Web 2.0 took over ten years, and it is expected that to implement and reshape the Web with Web 3.0 entirely to take just as long, if not longer.
Evolution can be traced from Web 1.0, a static information provider where people read websites with minimum interaction, to Web 2.0, an interactive and social web enabling user collaboration.
Following that trend, we can assume that Web 3.0 will change how websites are designed and constructed and how people interact with them.
With Web 1.0 and Web 2.0, the layout and delivery of webpages are defined by Hypertext Markup Language.
While HTML will continue to be a foundational layer with Web 3.0, how it connects to data sources and where those sources reside could be somewhat different from earlier iterations of the Web.
Nearly all websites and applications in the Web 2.0 paradigm rely on some form of a centralized database to enable functionality and deliver data.
With Web 3.0, applications and services use a decentralized blockchain instead of a centralized database, the basic idea being that there is a form of distributed consensus rather than an arbitrary central authority.
The construct of a decentralized autonomous organization (DAO) is an emerging governance ideal within the blockchain and Web 3.0 community.
Web 3.0 architectures and communities provide a form of self-governance in an attempted decentralized approach instead of having a central authority that governs a platform's operations.
Finance and the ability to make transactions with a decentralized form of payment are enabled across Web 3.0 using cryptocurrencies, all built and enabled on top of blockchain technology.
While Social bookmarking as a search engine can give better results than Google since the results are websites that users have voted on, these results can also be tampered with by humans.
In this case, AI could separate the legitimate results from the falsified ones, providing more relevant and agile data to end users and producing results comparable to social bookmarking and social media without untrustworthy feedback.
Semantic Web translates to categorizing and storing information in a way that helps teach a system what the data means.
A website should be able to understand terms from search queries the same way a human would, making it possible to generate better results.
Several key Web 3.0 features help to define what the third generation of the Web will likely be all about, including the following:
- Decentralized. Unlike the first two generations of the Web, where governance and applications were largely centralized, Web 3.0 will be decentralized, with applications and services enabled in a distributed approach without a central authority.
- Blockchain-based. With data and connections across services distributed differently from centralized database infrastructure, Blockchain allows for the creation of decentralized applications and services while enabling an immutable ledger of transactions and activity, providing verifiable authenticity in a decentralized world.
- Cryptocurrency-enabled. Cryptocurrency usage is a crucial feature of Web 3.0 services and essentially replaces the use of a government-issued currency backed only by the government that issued it.
- Autonomous and artificially intelligent. More automation overall is a crucial objective of Web 3.0, and AI will primarily power that automation.
A brief history of the Web
Web refers to the World Wide Web, the global Web of information and resources interconnected through hypertext links and the internet's core information retrieval system, as coined by pioneer Tim Berners-Lee.
The first generation of the Web, called Web 1.0, invented and defined in 1989 by Tim Berners-Lee, was based on direct access and connectivity across static websites, lasting until around 2004, when Tim O'Reilly helped define the concept of the next iteration of the Web.
Websites and online applications that rely on user-generated content for end users are referred to as Web 2.0; employed in many websites today, chiefly focusing on user interactivity and collaboration, it also focuses on providing universal network connectivity and communication channels.
Web 3.0 is the successor to these two previous generations of the Web.
Made of read-only webpages that, in the majority, lacked much in the way of interactive features, this first version of the internet is often called the "static web." A select few handled content generation, and information were hard to find, and little beyond browsing static pages was offered.
Berners-Lee, a computer scientist at CERN in 1990, pioneered the internet's early development, having written the three crucial technologies that became the foundation of the Web:
- HTTP: HyperText Transfer Protocol, allowing the retrieval of connected resources from across the internet
- URI or URL: Uniform Resource Identifier or Locator, meaning each resource on the Web has a unique address used to identify it.
- HTML: HyperText Markup Language, the markup or formatting language of the Web
The introduction of web browsers by the mid-'90s marked the era of static web pages retrieved from servers and impressive new features such as email and real-time news.
Users had minimal opportunities for interactive applications, as access to content creation was still in the very early stages of development.
The increased popularity of online banking and trading became a driving force behind the development of web applications.
The first Web 2.0 conference was held in October 2004 by O'Reilly Media and MediaLive, to present a plethora of new software applications built on the Web.
In late 2005 the video-sharing site YouTube was launched, quickly becoming a big part of the Web 2.0 revolution, which marked the beginning of dynamic content on the internet, as users could now interact with web pages by creating original content and communicating with each other.
The emergence of social media networks is the most significant symbol of this era, with the launch of Smartphones soon after, with the release of the first iPhone in 2007.
In as little as a few years, we were all creating content, sharing, and commenting on each other's profiles instantaneously from pocket-sized computers in the palms of our hands.
Web 2.0, what we know as the internet today, can be thought of as the read/write upgrade of the previous read-only iteration, a complete paradigm shift in internet usage.
Over the past fifteen years, the static web pages of Web 1.0 have been entirely replaced by interactive, user-generated, and socially connected content.
Accessible by millions of users worldwide virtually instantly, this unparalleled reach has led to an outburst in this type of content in recent years.
The exponential expansion of Web 2.0 has been driven by critical innovations such as mobile internet access and social networks, as well as broad access to powerful mobile devices like iPhones and Android-based devices.
These developments enabled the dominance of apps that greatly expanded online interactivity and utility—for example, Airbnb, Facebook, Instagram, TikTok, Twitter, Uber, WhatsApp, and YouTube, to name a few.
The phenomenal revenue growth of these dominant platforms has made many Web 2.0-centric companies—such as Apple, Amazon, Google, Meta (formerly Facebook), and Netflix—among the world's biggest companies by market capitalization (there is even an acronym for them: FAANG).
These applications have also spurred the growth of the gig economy by enabling millions of people to earn income on a part-time or full-time basis by driving, renting their homes, delivering food and groceries, or selling goods and services online.
Web 2.0 has also been tremendously disruptive to specific industries to the point of being an existential threat to some.
Representing the next iteration or phase of the evolution of the web/internet, Web 3.0 could potentially be as disruptive and represent as significant a paradigm shift as Web 2.0 did. The core concepts of Web 3.0 are decentralization, openness, and greater user utility.
This new web paradigm incorporates the technologies and ideas at the heart of crypto: decentralization, token-based economies, and Blockchain.
Decentralization suggests that by removing control from the dominant big data companies and other central authorities and handing it to the masses, this notion of Web 3.0 tends to be a more democratic version of today's online world.
Semantic Web and AI technologies will likely carry out content contribution and collaboration by focusing on machine learning and artificial intelligence to provide pertinent content for each user rather than just the content provided by other end users.
Reducing intermediaries and removing power from controlling entities is the essence of decentralization, meaning internet users can transact business peer-to-peer, focusing more on user privacy, transparency, and ownership.
By allowing for information to be stored on a distributed ledger outside the remit of any controlling entity, Cryptocurrencies, and the token economy facilitate this decentralization model.
With token holders permitted to participate in governance, a widely-spread criticism is that control remains concentrated among venture capitalists and early adopters, despite claims of democratization by some crypto projects.
Berners-Lee discussed the concept of the Semantic Web in 2001; Computers have no reliable way to understand the precise context in which a word or phrase is employed, his vision for the Semantic Web was to provide structure to the meaningful content of webpages.
Web 3.0 has evolved well past this original concept of the Semantic Web Partly, mainly because it is costly and monumentally challenging to convert all the subtle nuances and variations of human language into a format that computers can readily comprehend.
Defining Features of Web 3.0
Though there is as yet no standardized definition of Web 3.0, it does have a few defining features:
Decentralization is a core tenet of Web 3.0. In Web 2.0, computers use HTTP as unique web addresses to find information stored at a fixed location, generally on a single server.
With Web 3.0, because the data is found based on its content, it could be stored in multiple locations simultaneously and hence be decentralized, breaking down the massive databases currently held by internet giants like Meta and Google and handing greater control to users.
Users will retain ownership and control as data generated by mobile phones, desktops, appliances, vehicles, and sensors will be commercialized through decentralized data networks.
Trustless and permissionless
In addition to decentralization and being based on open-source software, Web 3.0 will be Trustless and Permissionless.
While Trustless means the network will allow participants to interact directly without going through a trusted intermediary, permissionless indicates that anyone can participate without authorization from a governing body.
As a result, Web 3.0 applications will run on blockchains or decentralized peer-to-peer networks, or a combination thereof—such decentralized apps are referred to as dApps.
Artificial intelligence (AI) and machine learning
In Web 3.0, computers can understand information similarly to humans through technologies based upon Semantic Web concepts and natural language processing.
Web 3.0 will also use machine learning, a branch of artificial intelligence (AI) that uses data and algorithms to imitate how humans learn, gradually improving its accuracy.
These capabilities will enable computers to produce faster and more relevant results in various areas like drug development and new materials instead of merely targeted advertising that forms the bulk of current efforts.
Connectivity and ubiquity: With Web 3.0, information and content are more connected and ubiquitous, accessed by multiple applications and with an increasing number of everyday devices connected to the Web—one example is the Internet of Things.
Potential and Pitfalls of Web 3.0
Web 3.0 has the potential to provide users with far greater utility, going well beyond the social media, streaming, and online shopping that comprise the majority of Web 2.0 applications consumers use.
Capabilities like Semantic Web, AI, and machine learning, which are at the core of Web 3.0, have the potential to increase application in new areas significantly and vastly improve user interaction.
Permissionless systems will give users greater control over their data, helping limit data extraction (collecting information from web users without compensation or consent).
However, decentralization also brings with it significant legal and regulatory risks.
Cybercrime, hate speech, and misinformation is already difficult to police and will become even more so in a decentralized structure because of the lack of central control.
A decentralized web would also make regulation and enforcement very difficult; for example, which country's laws would apply to a specific website whose content is hosted in numerous nations globally?
Web 3.0 applications
What's a Real-World Example of How Web 3.0 Will Be Able to Provide Greater User Utility?
For example, spending hours looking for flights, accommodation, and car rentals, browsing numerous websites, and comparing prices while planning a vacation.
With Web 3.0, smart search engines or bots can collate all this information and generate customized recommendations based on your profile and preferences, saving you hours of work.
Is Web 3.0 the Same as the Semantic Web?
Web 3.0 goes well beyond the Semantic Web envisioned by web pioneer Tim Berners-Lee in 2001. Based on Semantic Web concepts and natural language processing to make user interaction more intuitive, it also has other features, such as widespread use of artificial intelligence (AI) and machine learning, and trustless/permissionless systems, such as Blockchain and peer-to-peer networks.
Which Newer Technologies in Finance Will Be Facilitated by Web 3.0?
Because of its crucial decentralization feature, Web 3.0 lends itself to technologies such as Blockchain, distributed ledger, and decentralized finance (DeFi), enabling a growing number of different types of new applications and services, including:
- NFT. Non Fungible unique tokens are stored in a blockchain with a cryptographic hash.
- DeFi. Decentralized finance (DeFi), where decentralized Blockchain facilitates financial services outside the conventional centralized banking infrastructure confines.
- Cryptocurrency. Cryptocurrencies like Bitcoin are Web 3.0 applications that create a new world of currency that strives to be independent of the historical world of fiat currency.
- dApp. Decentralized applications (dApps) are built on top of Blockchain and use smart contracts to allow service delivery in a programmatic approach that is logged in an immutable ledger.
- Cross-chain bridges. There are multiple blockchains in the Web 3.0 world, and enabling a degree of interoperability across them is the domain of cross-chain bridges.
- DAOs. DAOs are potentially set to become the organizing entities for Web 3.0 services by providing structure and governance in a decentralized approach.
In 2021, Elon Musk, CEO of SpaceX and Tesla, expressed skepticism about Web 3.0, stating that it "seems more marketing buzzword than reality right now."
Just as the 2010s were the decade when Web 2.0 became the dominant force in the global business and cultural landscape, it might be Web 3.0's turn in the 2020s.
Facebook's name change to Meta on October 28, 2021, could be a premature sign that the transition to Web 3.0 is building momentum. If this prediction comes true, it could unlock speculative potential for investors and developers.
Web creatorAnalysts say that Web 3.0 will become an essential part of the ever-expanding evolution of the internet.