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What is Web3? A new decentralized web, or the latest marketing buzzword

Web3, as envisioned by the Web3 Foundation, will be a public internet where data and content are registered on blockchains, tokenized, or managed and accessed on peer-to-peer distributed networks.

Web3 promises to be a decentralized, immutable version of the web, free of intermediaries and built with the same cryptographic verifiability that has given rise to cryptocurrencies, non-fungible tokens (NFTs), and new types of decentralized applications underpinned by a distributed ledger, or Dapps.

If all of that sounds complicated, that’s because it is. For now, Web3 is a somewhat fuzzy concept that is still being defined—more an ideal for what the web could look like than a tangible and accessible technology stack for developers to build on today.

This fuzzyness has led to a certain degree of divisiveness around the term across the industry, with exponents lauding Web3 as a revolutionary way to return the internet to its libertarian roots, while notable skeptics like crypto optimist Elon Musk dismiss Web3 as a “marketing buzzword.”

The origins of Web3

Web3 was first described by one of the creators of the Ethereum blockchain, Gavin Wood. In a 2014 blog post, Wood envisioned “Web 3.0” as an encrypted online space to be built in response to the privacy concerns raised by Edward Snowden’s global surveillance revelations in 2013.

With Web3, “information that we assume to be public, we publish. Information we assume to be agreed upon, we place on a consensus ledger. Information that we assume to be private, we keep secret and never reveal,” he wrote.

This model would be “mathematically enforced” through cryptography, where transactions are verified and added to the blockchain for universal transparency and irrevocability.

In a November 2021 interview with Wired, Wood refined this definition further, to “less trust, more truth.”

The term Web3 didn’t truly start to take hold until 2021, however, when venture capitalists like Andreessen Horowitz partner Chris Dixon started to talk up Web3 as an “internet owned by the builders and users, orchestrated with tokens.”

As big investors in this space, Andreessen Horowitz has plenty of skin in the Web3 game, so a healthy pinch of salt is in order, and critics such as Twitter cofounder Jack Dorsey have been more than happy to call out Web3 as “a centralized entity with a different label.”

Web 1.0 and Web 2.0

If Web3 is the next iteration of the internet, how exactly does it differ from Web 1.0 and Web 2.0?

Web 1.0 was the first iteration of the modern internet, from 1990 until around 2004. In the Web 1.0 era, users typically engaged with static web pages where read-only content was created and distributed by a small cohort of gatekeepers like Yahoo and AOL.

Web 2.0, which broadly encompasses 2005 to the present day, is the dynamic and interactive web, in which static web pages are joined by apps and user-generated content. Web 2.0 is ruled by a set of dominant platforms, as represented by the market power of the FAANG companies—Facebook (now Meta), Amazon, Apple, Netflix, and Google, all of which exchange services for personal data to some degree.

Where Web3 purports to differ from Web 2.0 is by eliminating these powerful gatekeepers and empowering a more egalitarian internet, where users are repaid for their contributions with ownership through a variety of tokens, all while keeping their data private and secure on a shared, distributed, tamper-proof ledger.

“In essence, it means I personally can become a provider or a co-provider of this overall service just as easily as anybody else in the world,” Wood told Wired.

This is reflected in the Web3 Foundation’s mission statement, to “nurture cutting-edge applications for decentralized web software protocols” via a “decentralized and fair internet where users control their own data, identity, and destiny.”

This idea has naturally given rise to decentralized autonomous organizations—or DAOs—which are highly democratic internet communities with a shared goal and no leadership structure. Of course, one person’s egalitarian web could be another’s unregulated Wild West.

Web3 is also crucially different from what Tim Berners-Lee described as far back as 1999 as Web 3.0, or the semantic web, which was focused on making the internet machine-readable, a vision that remains largely unrealized.

The Web3 stack

Some engineers have already attempted to define the Web3 stack as it currently exists, but it is not a straightforward exercise.

Nader Dabit, former AWS senior developer advocate and now developer relations engineer at Web3 company Edge & Node, attempts to outline the Web3 stack at a high level as made up of:

  • Blockchain
  • Blockchain development environment
  • File storage
  • P2P databases
  • API (Indexing and querying)
  • Identity
  • Client (frameworks and libraries)
  • Other protocols

This is clearly a significant departure from today’s commonly used three-tier architecture for web development, which consists of:

  • A front-end web server
  • A middle layer application server
  • A back-end database or data store

Preethi Kasireddy holds the unique position of having worked for both the venture capital firm Andreessen Horowitz and the crypto exchange Coinbase. Her blog post on Web3 architecture lays out a development model where “you can write smart contracts that define the logic of your applications and deploy them onto the decentralized state machine [i.e. the Ethereum blockchain].”

The writing of smart contracts themselves likely requires learning new programming languages like Solidity, Vyper, or, increasingly, Rust. Then you will need to understand how to deploy to the Ethereum Virtual Machine, or a similar execution mechanism for the blockchain of your choice.

Developers will also need to get to grips with the mechanism for “signing” transactions to the blockchain, with MetaMask establishing itself as an early industry standard tool for this process.

Next, Kasireddy gets into the scaling problem of building applications on Ethereum. “Anyone who has built apps on Ethereum knows that storing everything on the blockchain gets really expensive, really fast,” she writes. This creates the need for “a decentralized off-chain storage solution, like IPFS [Interplanetary File System] or Swarm.”

These problems may get solved as more developers flood into the space and the tooling matures. Projects like Polygon are already working on a solution to the blockchain scaling problem. But for now, application development on the nascent Web3 stack looks challenging.

As Kasireddy herself writes, “If all of this is making your head spin, you’re not alone. Cobbling together all of these tools is complex and can lead to a painful developer experience. But don’t worry—we’re starting to see new developer frameworks which really improve the experience for developers.”

Web3 apps

One question that often comes up among Web3 skeptics is where are the applications? With a stack as nascent and complex as the one outlined above, it should come as no surprise that we have yet to see a glut of killer Web3 apps hit the market.

While Web3 promises to take the underpinning technology of NFT and cryptocurrency ownership into potential new realms of the web, that promise has yet to be fulfilled.

Early Web3 projects tend to be defined by their inaccessibility and fiddly user experiences. To access most Web3 applications, users will need a crypto wallet, most likely a new browser, an understanding of a whole new world of terminology, and a willingness to pay the volatile “gas” fees required to perform actions on the Ethereum blockchain. Those are significant barriers to entry for the average internet user.

While the decentralized social network Mastodon is built on some Web3 principles, as is the Brave browser, most existing Web3 applications cater to trading crypto-assets or betting cryptocurrencies on casino games.

“If Web3 is going to be the future of identity, or of social media, we need to ask ourselves what evidence is there of adoption—is it really a better mousetrap in the way that previous generations of internet technology proved to be?” asks Tim O’Reilly, who coined the term Web 2.0.

The Web3 Foundation lists several projects on its website, but these mostly focus on the underlying protocols required to build an interoperable Web3.

As Kevin Werbach, author of The Blockchain and the New Architecture of Trust, told TechCrunch: “Many so-called Web3 solutions are not as decentralized as they seem, while others have yet to show they are scalable, secure, and accessible enough for the mass market.”

Getting started with Web3

Ready to get started? There are a number of places you can go to learn more about the core Web3 principles and technologies.

Dabit at Edge & Node advises starting with the documentation for the popular Ethereum blockchain and the Solidity programming language for writing smart contracts. Then you can begin exploring the whole new world of Web3 tools, libraries, and APIs. You’ll also need a crypto wallet, such as MetaMask, to manage your Web3 assets.

There are also several Web3 tutorials emerging as interest in the term grows, including those popping up on the likes of Udemy, Coursera, Web3 University, Buildspace and through the Ethereum website itself.

Copyright © 2022 IDG Communications, Inc.