Jun 27, 2024
min read

What Is Web3: Everything You Need to Know

Web3 meaning represents a significant shift in how we interact with the internet, offering greater decentralization, user control, and transparency. As Web3 continues to evolve, it promises to reshape various aspects of our digital lives, from finance to social interactions, and beyond. So, strike while the iron is hot.

Press often compares the rise of Web3 to the quantum leap in internet technologies. Crypto, NFT, DAO, and DeFi, these buzzwords, are among the numerous advanced concepts connected with Web3. Let’s delve into the notion. What is Web3 technology and how to prepare for its advent?

Uni has answers. Over the years, Uni Agency has received more and more requests for Web3 projects, so we have plenty to share with you on this matter. Hold tight, we start.

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What Is Web3?

If we take the definition of Web3 by its major populizer Packy McCormick saying “the internet owned by the builders and users, orchestrated with tokens”, it won’t help much. However, it illustrates the crucial distinction between Web3 and previous web versions. In particular, the difference is how the elements are combined in a network.

Previously, the data kept floating from users’ systems to the central server and back. In Web3, it’s all different. The blockchain principle controls data flows almost entirely, endlessly leveraging transparency and security of operations. That’s why Web3 is often associated with decentralization, cryptocurrency, and smart contracts, which allow for peer-to-peer interactions without intermediaries.

What Are the Previous Versions: Web1 and Web2?

Before we rush into the Web3 meaning, let’s move to how different Web1 and Web2 it is. And again, the difference lies in the plane of structural elements.

Web1 (Web 1.0). Read only

Web1, also known as the static web, was something from what the internet started. In 1990, there the first stage of the World Wide Web appeared. Initially, it was text-based static pages that merely displayed information and had no opportunities to contribute or interact with each other.

Web2 (Web 2.0). Read and Write

The dynamic web, on the contrary, allows data exchanging in real time. That’s why we have our social media platforms like Facebook or YouTube. However, Web2 is flexible, it’s centralized too. The data flows through servers of a few corporations. That’s why we can’t say the internet is truly free since most of these companies control vast amounts of user data and internet traffic.

No panic, Web3 is going to change anything.

Web3. What Next?

As you can see, the difference between Web2 and Web3 is more about structure and interaction than the Web3 vs metaverse opposition. To be considered advanced, Web3 grounds on several cutting-edge technologies.

  • Blockchain, a shared technology to facilitate and record transactions. It’s continuously encrypted, so it excludes any possibility of fraud and hacking.
  • Cryptocurrency as a virtual currency doesn’t require a bank to verify transactions. Instead, it uses cryptography for security and operates independently on a blockchain.
  • Smart Contracts. Self-executing contracts with the terms of the agreement directly written into code, allowing automated trustless transactions when several conditions are met.
  • Decentralized Applications (dApps). Applications that run on a blockchain network rather than a centralized server.
  • Decentralized Finance (DeFi). Financial systems that operate without traditional intermediaries, using blockchain technology to offer services like lending, borrowing, and trading.

In other words, Web3 heavily relies on blockchain tech on the principle “What is written with a pen cannot be cut out with an ax.” So it changes the whole system of relations, “the hyperfinancializing all human existence.”

What Is the Difference Between Web2 And Web3?

The best-illustrated breakthrough of Web2 in comparison to Web2 is the transition between black-and-while movies to multicolor. Drastic? Positive. Let’s sum it up in a table.

What Is Web3 In Crypto?

However, Web3 is not a panacea. Although it refers to blockchain technology and decentralized networks, Web3 needs time and infrastructure to prevail with time. Cryptocurrencies can help in that. For example, Bitcoin and Ethereum are based on the same principles as Web3, providing the necessary infrastructure for secure, peer-to-peer transactions and smart contracts.

Nowadays there are more than 10 thousand cryptocurrencies in the world, however, only the top 20 of them span 90% of the market. As a result, crypto has become a basic payment instrument, enabling more and more peer-to-peer transactions with time.

Examples Of Web3 In the Real World

Let’s illustrate some of the Web3-based technologies with examples.

  • JPMorgan Chase made its first blockchain transaction with tokenized Singaporean dollar and Japanese yen.
  • Ethereum, a cryptocurrency with smart contracts and decentralized applications.
  • Brave Browser. A web browser that blocks ads and trackers by default, rewarding users with cryptocurrency for their attention.
  • Decentraland. A virtual world built on the Ethereum blockchain where users can buy, sell, and trade virtual real estate and assets.

How Is Web3 Related To the Metaverse?

The latter example of Web3 use cases is about a metaverse. In practice, the Web3 vs metaverse juxtaposition is not winning to any party. They are just about different things. Foremost, the metaverse is a virtual reality space where users can interact with a computer-generated environment and other users. Secondly, although Web3 technologies are foundational to the development of the metaverse, the metaverse is a new paradigm, not a structural concept.

What are Some of the Issues Associated with Web3?

Despite its potential, Web3 faces several challenges:

  • Scalability. Blockchain networks often struggle with processing large volumes of transactions quickly because of heavy computational loads.
  • Regulation. The regulatory base for Web3 technologies is still evolving, creating uncertainty for developers and users. What if governments will bind all crypto operations or whatsoever? It’ll be frustrating (and, relax, not probable).
  • Usability. Web3 applications can be complex and less user-friendly compared to their Web2 counterparts.

Wrapping Up

Web3 meaning represents a significant shift in how we interact with the internet, offering greater decentralization, user control, and transparency. As Web3 continues to evolve, it promises to reshape various aspects of our digital lives, from finance to social interactions, and beyond. So, strike while the iron is hot.

Ideate new Web3 projects with Uni. Have a guess?

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Dmytro Dzandzava
Delivery Manager
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