Web3 has attracted increasing attention since the turn of the decade in 2020, with major tech companies entering the space. But what is it, and how does it differ from web2, the internet version we currently use? This web2 vs. web3 guide explores the key differences between the current internet and its decentralized future, predicts what web3 might look like, and examines its connection to crypto and blockchain technology.
KEY TAKEAWAYS
➤ Web3 offers decentralized, user-controlled internet experiences built on blockchain and smart contract technology.
➤ Web2 relies on centralized platforms, while web3 prioritizes user privacy, data ownership, and trustless interactions.
➤ Web3 applications include cryptocurrencies, DApps, NFTs, and DeFi, all driven by blockchain and decentralization.
➤ Web3 faces challenges from big tech resistance, but blockchain adoption could drive its future success.
What is web1?
Web1 was the early stage of the internet and it marked a significant technological shift. It was primarily a way to deliver static content and information through websites. This era is referred to as the beginning of the internet as we know it today.
Use cases and examples
During web1, platforms like MySpace and LiveJournal began allowing users to produce their own content. There was no strict line between web1 and web2, as these terms are not official classifications.
However, the key difference was that web1 consisted mainly of static web pages hosted on ISP servers, with minimal user interaction or corporate involvement.
The downsides of web1
While web1 was revolutionary, it had significant limitations. User participation was minimal, and most websites only allowed content to be viewed, not interacted with or altered.
Websites like Wikipedia, which enable public participation, did not exist during this period. Users were limited in how they could contribute content, and personal blogs were much more basic compared to later platforms like Facebook and Twitter.
Additionally, users could only download applications, with no insight into their inner workings or source code.
What is web2?
Web2 is a term that was first used in the so-called “dot-com bubble” era. It was intended to reflect the transition to a more sophisticated era of the Internet.
Web2 involved a greater degree of corporate interference. Unlike web1 websites, the new ones often had a plan for generating income.
They also allowed for greater user interaction with the platforms. And, in fairness, most of the most popular new companies continued to exist even after the market crash.
Use cases and examples
There was a greater degree of finesse about websites labeled as web2. For example, these sites allowed users to modify the design in much greater detail.
Furthermore, the code used for many applications on the new iteration of the web was open source. This meant that anyone with the right technological expertise could take a peek, analyze, and even, modify it.
While the corporatization of the Internet was also in full effect, new websites gave a greater voice to users. For example, sites such as Amazon allow any user to add reviews to the products listed on the sites. Wikipedia also allows users to alter the entries on their encyclopedia-like site.
Newer social media platforms such as Facebook and Twitter let people interact with each other in a public setting to a greater degree than previous platforms have been able to do.
The downsides of web2
While web2 brought increased interactivity and greater technical capabilities, it also introduced new challenges. The growing influence of corporations meant that these companies could censor content according to their own guidelines.
Additionally, users became reliant on centralized servers, which, if they went offline, could cause major disruptions.
Furthermore, services like payment platforms started requiring adherence to specific terms and conditions, leading to unilateral decisions on denying payments or access. While web2 provided new possibilities, it also limited user autonomy.
What is web3?
Yes, the buzz surrounding web3 since the early 2020s has been significant — and understandably so. After all, it promises a stronger, safer, decentralized form of the Internet. It’s an iteration of the Internet that will be an improvement over the so-called web2 of today.
Web3 is often used to discuss a plethora of different online apps. It’s believed that Ethereum co-founder Gavin Wood, first used the term web3 back in 2014.
However, it is generally accepted that the element that will connect the strand between all web3 apps is the use of blockchain technology used to create decentralization.
Web3 can also be understood by comparing it to the current version of the Internet. Currently, internet users generally access information that is hosted on the servers of third-party companies. Similarly, newly built apps are added to the servers of other companies, such as Google Cloud or AWS.
However, web3 will allow internet users to develop and maintain DApps (decentralized apps).
The features of web3
Just as web2 offered a greater degree of sophistication over the static pages of web1, web3 should also represent a technical advancement. Does it already exist?
Online applications that adhere to the principles of web3 are already available. Mass adoption, however, will not occur overnight. Still, we can look at some of these applications and use them as a template for what the Internet may look like in the not-too-distant future.
The main feature of web3 is data sharing, as an alternative to data ownership. Blockchain technology allows all users to verify the information and contribute to the information being stored.
Web3 will also contain aspects related to the fabled metaverse. Advanced 3D graphics, as well as augmented and virtual reality, will be used for applications on web3.
Lastly, and perhaps, most importantly, web3 will make use of smart contract technology. In a nutshell, this can help create a trustless form of the Internet and greatly reduce the need for third-party middlemen.
Use cases and examples
An application must leverage blockchain technology to qualify as web3-optimized. Cryptocurrencies, DApps, DeFi projects, non-fungible tokens (NFTs), and decentralized autonomous organizations (DAOs) all fit into the web3 ecosystem.
Examples include Bitcoin, NFT marketplaces like OpenSea, decentralized social media platforms such as Steemit, and play-to-earn gaming platforms.
In other words, crypto-projects that embrace the concept of decentralization are ready for the proposed web3.
Benefits for web3
There are numerous benefits when it comes to the fabled switch to web3. But, who are the main beneficiaries? Does anybody stand to lose from the development of this kind of technology?
If the proposed changes are adopted on a grand scale, this will benefit regular internet users. Web3 would technically mean that every user contributes in the way that the Internet is built. It would also mean that much of the power of big tech corporations would decrease and be shared among the entire population.
Web3 would also have less of a negative impact on the environment. It would be a sustainable model. It would increase connectivity. Smart contracts could help make the Internet into a trustless system. And the use of AI and the semantic web would help humans better harness the power of modern technology with less likelihood of human error being involved.
Can web3 succeed?
However, there are those that stand to lose from the emergence of web3. If the plans for true decentralization come to fruition, this will affect large tech companies. These have benefited greatly from the switch to a more commercialized approach in web2.
Some important heads of tech companies have expressed their lack of optimism regarding web3. Tesla founder Elon Musk has gone on record as saying web3, to him, feels like a marketing ploy.
Furthermore, former Twitter CEO, Jack Dorsey, believes that decentralization is impossible. Dorsey claims that big tech companies will not allow themselves to lose control of their current power.
Lastly, for web3 to become a reality, a much greater adoption of blockchain technology needs to happen.
Web2 vs. web3: The major differences
Web3 is best understood in contrast with web2, which it would be replacing. Let’s look at some of the main differences between the two.
Decentralization
In web3, decentralized networks will ensure that individuals have control over their online data. It will also mean that the playing field will be leveled. The network would not be supported by one individual or institution. The responsibility and rewards would be shared by everyone involved in the running of the blockchain.
Privacy
Privacy is a significant concern of modern internet users. Various data leaks have been dissected at length by news outlets in recent years. It is argued that web3 would offer a higher degree of privacy. Distributed personal data stores would offer individuals greater control of their data.
Proponents of this idea believe that this allows users to depend less on third-party companies to manage their data. There are critics of this idea, however, that claim that just the idea that all information is publicly available on a blockchain contradicts the concept of greater privacy for users.
Trustless and permissionless
Similarly, the use of smart contracts can create a trustless internet. This means that individuals will not need to put their faith in third-party actors. Trades, for example, can be executed automatically based on the features encrypted in the smart contract.
The Internet would also become permissionless. This means that any user can validate transactions, or mine, on the blockchain. Furthermore, any user can use features such as buying or selling without requesting the permission of a third party.
Greater connectivity
This proposed internet of the future would also allow for greater connectivity. The use of semantic data is supposed to help create novel ways of organizing, using, and discovering information. All of this can lead to a great increase in the user experience.
Should you get ready for the new internet?
Web3 is still in the early stages of development, so one can’t tell with certainty how it might play out. There are aspects of it that are almost certain to take place, while other more hopeful goals — like complete decentralization — will certainly face some pushback.
Nonetheless, individuals should expect a significant amount of change in terms of how we interact on the Internet within the next ten years. It will be an exciting time and one ripe with opportunities.
Frequently asked questions
What is web2 vs. web3?
What is web3 used for?
What are web3 companies?
How is web3 different?
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