What Is Web3 & How Does It Work?

Everything started from centralization. It helped billions access the world wide web and interact through it. But as time went on, lots of folks were not comfortable with how it was run. It was controlled by big companies and entities. Data was controlled by them, and they could decide whatever to do with it.

This gave birth to Web3, which is a decentralised space that advocates user freedom and ownership. It gives direct power to the hands of users. Before web3, we had Web 1.0 and Web 2.0, though the latter is way more advanced than the former. Even with this, Web3 has proven to be better with its growth. It is a growing community, and you can’t fathom where it will be in five to six years.

What Is Web3?

Let’s get on to the next topic, “what is Web3”?. In 2014, computer scientist and Ethereum co-founder Gavin Wood coined the name Web3 in his article titled “Insights into a Modern World”. At this time, there were concerns about web3. A lot of folks didn’t really trust the space and felt their privacy wasn’t secure.

In the article, Garvin Wood made people understand what decentralisation is. That they can control their data and decide what to do with it by themselves. This was more amusing to them, and people started giving it a chance. 

How does web3 work?

There are principles web3 follows that make it work. This includes Ownership, pseudonymity, DAO and native payments.

• Ownership: This is the bedrock of Web3. A large part of the internet is owned and controlled by big tech companies. Facebook, Instagram, Twitter and Google are prime examples. They control your data and activities on their platforms and can decide to remove you at any time. In Web3, you can own products through NFTS, Non-fungible tokens. What you buy here belongs to you alone. When you buy cryptocurrencies or develop blockchains, you have sole ownership. No one controls it except you.
• Pseudonymity: On Web 2.0, when you create an account, your personal information can be seen by the public, and it can be used to trace you. You even have to verify your pictures at times before you have access. And to make it worse, you might need to give them some very private data before they grant you access. Web3 doesn’t need any of that before you can hop on the space while still protecting your privacy. Users can interact with each other anonymously. Your privacy is in your wallet. That is, the Web3 platforms won’t expose your names and information to the public. People can identify you with your unique wallet.
• Decentralised Autonomous Organisations: The Web3 apps are owned by Decentralised Autonomous Organisations, known as DAO. Just as you have full ownership of your data, you can own a platform on Web3. It’s different here compared to web2, where the apps are owned by centralised entities. In DAO, users agree upon smart contracts and use tokens for decision-making. It runs on a democratic system. Everyone’s opinions count in the decentralised community.
• Native Payment: You can make seamless payments without the need for a trusted third party. Traditional payment methods like bank transfers and debit/credit cards still have some restrictions. The payment you make can only be in a particular region. Only a few big entities like PayPal allow you to make international transactions. In Web3, the payment system is borderless and without stress. ETH and Solana are cryptocurrency networks used for payment. What you need is a crypto wallet, and you can make payments easily. 

The Evolution of the Web

The Web continues to evolve as time goes on. You cannot compare how things were in the early 90s to now. New developments come into place, and the Web is not excluded. The evolution has been broken down into three stages: Web 1.0, Web 2.0 and Web3.

What is Web 1.0?

Web 1.0 is the first stage of web evolution. This took place from 1990-2004. Tim Berners-Lee developed protocols that eventually would become the world wide web in 1989 at CERN. His idea was to create a hub where people could access information.

This era was called the read-only era. Users were able to read the contents published on static websites by companies and could not interact with them. The improvement it had was that developers could upload contents that were readable and not in the dynamic HTML format.

Features of the Web 1.0 sites:

1. Non-interactive pages.
2. Content is linked to a server’s file system.
3. Common Gateway Interface (CGI) is used to build pages.
4. Elements on a page are arranged with the use of frames and tables. 

What is Web 2.0?

Web 2.0 is the second generation of the world wide web. It built on what Web1.0 did and made it better. If you are reading this piece, then you must have experienced web 2.0. This era started in 2004 as social media emerged. It is called read and write because you don’t only read the contents, but you can interact with it. Developers and companies are not the only ones that can create content, users can now create their own content and post it online. The web 2.0 sites were built with JavaScript frameworks. 

As many people came online, the web 2.0 space was monetized. You can’t compare the early days of big techs like Facebook, Twitter, and Instagram to how they are now. The developers try to get many people to use their platform and then monetize it. 

The advantages of web 2.0 cut across everything people want to do on the internet today. Podcasting, blogging, content creation and social networking are the upsides. The lowsides are security and privacy breaches.  There are lots of data breaches and users cannot control their data.

Why is Web3 important?

Web3 is often regarded as read, write and own, which is far better than what web 1.0 and web 2.0 offer. Although it’s challenging to provide a rigid definition of what Web3 is, a few core principles guide its creation.

• Decentralisation: Instead of having the apps controlled by centralised organisations, the developers and users get ownership. Whatever you create on Web3 belongs to you, and you reserve rights to how it’s modelled. 
• Permissionless network: In web3, everyone has equal access to all of its features. An old user and a new user have the same level of access. No one gets some special favour over the other. 
• The native payments: Web3 uses cryptocurrency for payments which is borderless compared to bank payment systems. You can buy and sell to anyone in any part of the world without delay. 
• Trustless system: A third party is not needed for transactions in web3. The interaction is between the parties involved. No need to pay any extra person for anything.

Web3 limitations

Web3 is still growing, and it has not reached its apex yet. Even with the positives it brings, there are still some limitations. It has to be fixed for the web3 space to become better. 

• Accessibility: This is a big concern for people that want to access it. Yes, creating crypto wallets like Ethereum is for free. But transactions come at a very high cost. For example, if you want to buy tokens like NFTs, you need to pay some fee first before you buy the actual thing. Not everyone has this privilege. The more reason why folks will stick to the traditional payment methods.
• User experience: New users find it hard to navigate their way on web3. The interface is complex, and it takes time to understand. This can make people lose interest in joining web3.
• Cannot replace Web 2.0: Realistically, web3 has very low chances of replacing web 2.0. When you compare what the two of them offer to the layman, web 2.0 will be his go-to. Why? Because it is easier to use and compliments his everyday life. People consume a lot of content daily, which is why big companies like Facebook and Instagram keep thriving.
• Centralised infrastructure: Up till now, web3 is still depending on centralised infrastructures like Github and discord to function even though it’s believed to be a decentralised community. When you create some decentralized solutions, outside of public visibility, they can be based on such popular centralized services, which creates a point of failure.
• Regulation problem: It’s difficult to regulate web3 because of its decentralisation. Cybercrime, online abuse and scams happening cannot be easily traced on web3. This makes people scared of joining the space.
• Ownership concerns: There are concerns about ownership in web3. Experts believe that it’s just another name for web 2.0 made to suit people that want freedom’s ears. Former Twitter CEO Jack Dorsey argued that users will not be the owners, but VCs and their LPs will do. That is, the ownership will be one-sided, like web 2.0.
• Proof of stake problem: Web3 platforms are built on proof of stakes. This has validators, meaning the more tokens you stake, the more money they make. So when the information in the blockchain is updated, they make money.

• DAO privacy: The DAO source codes are open to the public. This is risky because it is susceptible to hackers and cybercrimes. A lot of fraudsters make use of the decentralised platforms to carry out activities because they cannot be traced. In 2021 alone, $14 billion was lost to fake wallet addresses.

The future of Web 3

Web3 is still evolving. Every day, new inventions are added to make it better. Gavin Wood gave it the name in 2014 when it just started, but from then till now, there has been massive progress in the developments. Recently, we’ve seen a high rate of interest in blockchain, cryptocurrency and NFTs. This is just the beginning, the more support it gets, the more advanced it becomes.

Getting into the web3 space might be confusing. I’ll list some steps to follow so it can be an easy ride.

How to get into Web3:

1. Create a crypto wallet (e.g. Ethereum address)
2. Search for a community and join
3. Check out the web3 apps
4. Join a DAO
5. Build on Web3