What is Web3 and should you care about it?
Understanding the next generation of the internet isn’t something you can casually check off your to-do list, so if the term “Web 3.0” makes you sigh heavily with anticipated exhaustion, we get it. (And you’re not alone.)
Press pause on the fretting because there’s good news: you don’t have to own crypto or understand the mechanics of blockchain to comprehend why we’ve reached this stage of digital pioneering. Before we get to the cultural and philosophical questions driving Web 3.0 into existence, let’s go back to yesteryear by defining Web 1.0 and Web 2.0 for points of comparison. This episode of Cryptalk, a podcast “designed to teach everything you want to know about cryptocurrency and Web 3” helped break it down for us:
Web 1.0 is the original internet infrastructure that was open sourced and built to connect people together through static domain pages, along with new technologies like email. It was a time before Google and social media, a world without any of the apps you’re addicted to today. In retrospect, how thrillingly simple.
Unless you knew how to code in 1990, you were a consumer of the internet in its 1.0 stage, not a builder. Then came Web 2.0, a centralized internet experience. Domains offered sets of tools to give people the ability to build their own online platforms, like securing an Instagram username, without having to speak in HTML. Cryptalk likened the experience to renting an apartment in a giant apartment complex rather than owning your own living space. It was a connected web of platforms: the rise of the blogger and the social influencer, the comments section discourse, the “I built my website using Squarespace,” that’s all thanks to huge tech organizations offering us the ability to do so. But that ability to create and actively consume comes with a hefty tradeoff, and that tradeoff is one, our data and two, the ability to own the content we generate.
Enter our new, decentralized friend, Web 3.0. This stage of internet culture is geared towards personal ownership and community, lofty goals that have far-reaching implications. Forbes puts it plainly: “decentralized infrastructure and application platforms will displace centralized tech giants, and individuals will be able to rightfully own their data.” Sheila Warren, founder of the blockchain and digital assets team at the World Economic Forum, sets up the most relatable example in this episode of Tech’d Up with host Niki Christoff:
“Think about your payment app of choice. What if we went out for drinks, and I forgot my wallet or credit card. I’ll just get out my phone and zap you money through whatever system we choose. Zelle, Square, Venmo. We’re relying on that system to handle that for us. And what they’re doing is making sure they have a trusted relationship with our banks, and are engaging with an essentially centralized system in an exchange of value between you and me. Or I could just hand you cash. I could literally hand you a $20 dollar bill. If you think about the difference there, and the amount of entities and people and agendas that are between us in that one context, versus in the other, literally handing you a $20 bill, there’s something to be said that, maybe, we need more opportunities for that direct transfer. And maybe, those opportunities can be digital.”
If you’re understanding the vibe shift but can’t comprehend the extreme jump to maintaining a digital wallet of crypto, we’re with you. Examples of the beginning principles of Web 3.0 are already floating around us. Let’s take everyone’s new favorite buzz word “metaverse,” for example. Again, Sheila Warren, a mom of two, creates a hypothetical metaverse scenario within the context of gaming. Right now, if you created an avatar with purple hair who wears a fabulous cape, that avatar’s identity is housed within the world of the specific game you’re playing. If you wanted to wear a cape in all of your digital gaming worlds, no matter the platform, you can purchase this “loot” so that it’s your own. If this sounds a lot like an NFT exchange, it’s because it is. See, you already know about early trends that fit into the Web 3.0 ecosystem, and it doesn’t stop there.
Take Twitter’s future, for instance. Putting its potential change of ownership aside, in this incredible episode critiquing the longevity of crypto (truly a must listen), Ezra Klein and Dan Olson go into how fractionalized ownership, such as building communities at the viral tweet level can get very messy, very fast.
“You own all of your actions and all of your data, and you are thus free to sell and profit off of that. A lot of it’s about control. A lot of the myth making is about control. And this is where it starts to get a little bit fraught because we start running into things that crypto enthusiasts will describe as good things. They’ll be just like, oh. They’ll get super hyped about, imagine if you had granular ownership of like every single tweet you ever made, and you could fractionalize those tweets and their value.
You could take a tweet that was really popular, and you could fractionalize it so that you could create a community around that tweet, where everybody who buys into this fractionalized version of that tweet owns a part of the essence of that tweet. And then the more that tweet gets sold, the more that fractionalization increases in its perceived value, and the more you are rewarded as the person for tweeting that. And they’ll get really excited about that. And I just look at that and go like, that sounds horrifying to me, but they get really excited about it.”
Does anyone really want to own a tweet because of its contents? If you take away Web 3.0’s purist definition of decentralization, we’re already seeing iterations of localized ownership. Twitter’s variety of subscriptions are methods of returning control to the platform’s power users, or at least the illusion of more control.
Where do we go from here? It’s genuinely unclear. The cultural hype around this digital way of life doesn’t seem to have peaked, but there are serious questions to answer before we know if this concept of decentralization will work in earnest. Again, Klein and Olson ponder our collective diligence: do you click through and read every Service Term & Agreement when filling a website’s cookie jar?
“Something I’ve learned covering financial institutions and transactions is, complexity is dangerous. Complexity is where markets get warped. Whoever has the money to dominate the complexity, to understand the complexity, can screw you over. People don’t read the terms and services they click on on everything they’re doing on the internet. Most of us don’t read the little cookie pop-ups that come up.
And so this idea that we’re going to have this world where everything is smart contracts and so on that self-execute, everything or things we own that can just be moved around, but that we’re not going to get screwed over because we didn’t read the contract or didn’t understand it, seems wrong to me.”
How are the same people expected to manage their digital money without an institution keeping its eyes peeled for scammers? A few days ago, Seth Green lost thousands of dollars in Bape NFTs. If you’re opting into Web 3.0, you’re opting into a lot of responsibility.
Before you start building your future in a metaverse far, far away, take a personal temperature check by pondering the following questions:
Is internet centralization drastically impacting my ability to engage meaningfully with my audience?
Do I feel the need to remove institutional banking from my immediate future?
Am I ok with taking risks that may cost me monetarily?
Sometimes, it seems like you have to jump on the next big thing. But sitting in a moment of introspection can help identify a path forward; trust that you’ll learn where and when you should participate in this new age of online life. [Spoiler alert: we’re not getting involved in Web3 anytime soon]
But that doesn’t mean we won’t keep an eye on it. You can, too. Because this is one of the buzziest business trends to discuss, there’s no shortage of qualified, interesting people talking about Web 3.0. This compilation of introductory podcast episodes had us off to the races. We’d love to know which episodes were the most enjoyable to you.