In the late 1990s, many of us began to get connected to the internet for the first time. There was a lot of excitement around the many possibilities that this new technology could offer, and this was reflected in the way investors poured millions of dollars into companies that simply had “.com” in their name.
If you’ve done any reading on the matter, you’ve probably heard the stories of companies like Pets.com that achieved huge valuations but became a victim of the bursting dot com boom. Then there are the tales of companies that survived and went on to become giants, this list includes names like Amazon, eBay, and Google.
This wasn’t the only boom we’ve seen on the internet. Shortly after the dot com bubble deflated spectacularly, we saw a huge upswing in interest in online poker sites. In 2003, the World Series of Poker was won by a player who had qualified online for the first time. This helped to inspire millions of others who wanted to follow in his footsteps, sparking a period that ran for most of the 2000s and is now known as the “poker boom”.
Shortly after this, we saw the explosion of social media sites and mobile apps that promised to create a more interactive internet. This boom was widely referred to as Web 2.0 and is, for the most part, what we continue to use today.
However, we’re on the verge of another boom as a new iteration of the internet is being touted that is being referred to by the rather unimaginative name of Web3. But what is Web3 and what does it mean for tech users?
Web3 – A New Generation of Internet?
Web3 may seem like a new concept, but the term was actually coined back in 2014 by Gavin Woods. While Web 1.0 was the static webpages we used to visit in the 90s and early 2000s, Web 2.0 saw new communications tools explode in popularity. However, many of these services are owned by a small number of companies, including Google, Facebook, and Amazon. This has given them unprecedented levels of control over what we say, see, and do online.
Woods’ vision for Web3 diverted the internet away from this centralized model and back to one where the power is shared more equally. To do this, he believes blockchain technology will be necessary to allow for the ownership of apps to be distributed among its owners. That’s why he created Ethereum, the world’s second-largest cryptocurrency.
Just a Buzzword?
Buzzwords are like parasites. Once they start to spread, it’s hard to contain them. At present, Web3 is at risk of just being another buzzword to go along with others like NFTs, DeFi, and dApps that have become common parlance among tech enthusiasts.
Bloomberg has described Web3 as being “hazy” and others have suggested that the technology required to make it happen is several years away.
Unless the term can break away from this ambiguity, then it will likely remain a buzzword. It seems a little unfair to only call it a buzzword, especially since Web 2.0 was also considered to be one for many years until interactive services really took off.
How Will Web3 Affect Tech Users?
Users of current Web 2.0 services, such as messaging apps and social networks are likely to benefit from a decentralized internet. It could allow better protection for the data that’s shared online since there’d be no way to integrate a secret backdoor to bypass the encryption.
Another proposed product of Web3 would be the Decentralized Autonomous Organization (DAO), which is essentially a co-operative business that’s run by the people on the blockchain. They would decide the prices for the products they sell and who would receive the profits. Such a system could help to make profiteering and market manipulation more difficult, and its proponents argue it could create a fairer society.
The Problem With Web3
The people shouting about Web3 are quick to point out its potential virtues, but there are some downsides that could come along with it. Firstly, blockchain technology is currently very energy-intensive, which isn’t great for the environment. This is especially true for mining tokens like Bitcoin that use a proof-of-work model.
Aside from the effects on sustainability, Web3 still needs infrastructure to run and this isn’t cheap. Former Twitter CEO, Jack Dorsey, argues that this could mean venture capitalists would own much of the hardware that will run Web3 applications. If this is correct, then it wouldn’t solve the problems with Web 2.0, but just move the responsibility for them to someone else.
Right now, Bloomberg is probably right in its assessment of Web3 being “hazy”. There are some exciting concepts being touted that could make a big difference to the world if they’re realized.
But while they remain just concepts, it’s hard to know what an average tech user should do. They could wait and see, but potentially miss out on early opportunities, or they could experiment with the early Web3 services, but risk being caught up in potential scams or the 2020s equivalent of Pets.com.
