Over the last several years Web3 or Web 3.0 has come to nominate two completely different but equally hazy visions of the future of the Internet.
One, conceived and evangelized by Tim Berners Lee, the father of the internet, is an extension of the internet as a Semantic Web which basically envisions all the content being machine-readable. This promotes a standards-based approach to promote common data formats and exchange protocols, across the web.
The other, which is the main concern of this blog and conceptualized by Ethereum co-founder Gavin Wood in 2014, is a vision to decentralize individual services, both in terms of ownership and power, using technologies like blockchain, smart contracts, various cryptocurrencies, and non-fungible tokens.
The basic idea is to build financial assets into the inner workings of everything that gets done on the internet. These assets or tokens created could then be exchanged or traded without bank or government involvement.
These ideas continued to expand to include concepts like decentralized autonomous organizations (DAOs) which are organizations represented by rules encoded as computer programs (often called Smart Contracts). These are transparent, controlled by the organization members, and not influenced by a central government. All the transactions record related to these organizations are maintained on a Blockchain.
At least on a conceptual level, these two approaches could evolve and coexist in the future.
While the final contours of this second vision of Web 3.0 continue to evolve in surprising ways the one compelling idea shaping all the advances remains – Decentralize Everything. The rest of this blog looks at this from about the height of Mount Everest.
At this level a completely distributed version of a Three-Layer Service typically made up of Presentation Layer, Application Layer and a Database would be decentralized by
Using a Peer-to-Peer networking service (based around Hypermedia Protocols) like IPFS to furnish the presentation layer and content. The content deployed on these services (like the bit torrent sites of old on steroids) is split into smaller chunks, cryptographically hashed, given a content identifier, and cached on and furnished from many peers on the network. This provides the immediate benefits of making these cheaper to host, resistant to tampering, censorship, and backbone failures, and almost infinitely persistent.
Using Smart Contracts to enforce all business logic within the Application layer. Smart Contracts are pieces of code that are deployed and executed on the Blockchain whenever a user requests a transaction.
Using a distributed immutable DB called a Blockchain for all data storage
Using Self-sovereign identity (SSI) for authentication. In an SSI system, holders generate, and control unique identifiers called decentralized identifiers. The credentials are managed using crypto wallets and verified using public-key cryptography anchored on a distributed ledger.
This gives individuals control of their digital identities.
Web3.0 from this perspective is a vast and evolving ecosystem of ideas rather than a single plan of action to upgrade the Web from 2.0. And to that point, the current set of applications built on these principles are also extremely varied.
Fintech, Social Networking, Gaming, etc all verticals are now represented within this system. Applications using the fundamental ideas of Web 3.0 have proliferated over the last couple of years and many more continue to be funded and built. Many of these introduce new ideas into the mix making the ecosystem as exasperating as it is exciting.
What the future holds in terms of this idea is hard to foresee. Some of the inefficiencies that plague these systems are well-publicized. The distributed nature of the system also means hundreds if not thousands of copies of every asset being maintained which is again an expensive affectation.
The basic asset creation mechanism of mining uses a concept of Proof of Work which besides being slow is also extremely expensive in terms of energy consumed. This has an interesting side effect of localizing the mining activity to those areas where energy is cheap, resulting in a new kind of centralization.
The alternative, Proof of Stake, the approach gives control to those who have high levels of investment into the systems since they can stake more and hence get their writ to run. There is much truth to the statement that this approach takes the control away from the big tech companies and hands it over to tech investors. It is not surprising that so much of the conversation Is being driven by investment firms instead of technology leaders. And the two groups seem often at odds with each other.
Is there a middle ground to be found between the current web, monopolized by a handful of internet giants, and this completely decentralized reincarnation of it? We will find out in a few more years. Either way, it will be an exciting journey across a landscape crisscrossed by hundreds of tracks with no single map to help us navigate.
Meanwhile, find some piece of NFT art that excites you and invest in it. There was one recently auctioned for $60 Million. More on this soon.
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