I’m sure you’ve been hearing about web 3, the blockchain, bitcoin altcoins etc. All these buzzwords are all over the internet and the startup echo system. I’m also sure that most of what you know about these is that people buy bitcoin, sell it, and make a lot of money, or that people have lost much money during the current bear market. I’m also sure you’ve heard of people trading images of angry apes and lions for millions of dollars. You must have asked yourself what’s going on? are these people crazy? why are they throwing around a lot of money on pixels and coins that exist only in a virtual world?
Well, all the above is part of the web-3 revolution. In this article, I’ll introduce you to it, I’ll make you understand what the Web-3 is, and why it is such an important “Revolution”.
This article is available as an episode of my podcast in French on Spotify, Apple podcast, Google podcast, etc…
What is the Web-3?
To understand what the Web-3 is, we need to understand what the web-1 and 2 were. First, you should know that the internet as we know it today, is predominantly web-2 based. The web-3 is still in its infancy according to experts.
Before we dive in the details, here is a short simple way of understanding all the web versions.
- On the web 1, users could connect to the internet, access websites to view and download content
- On the web 2, via the internet users can visit websites or apps, to consume, create or share content. This era gave birth to giants like YouTube and Facebook
- On the web 3, still via the internet, users can connect to websites, apps or blockchains to consume, create, share and most importantly, own their data in addition to executing instructions too (Smart contracts). All these in a decentralized fashion.
Before the Web 1:
A long time ago, when personal computers (PCs) started to become available to most of the population, the transfer of information from one PC to another was tedious. To transfer data from your PC to another PC, you had to copy the data in a “Floppy disk” (The ancestor of the USB stick) then take the disk to the next computer and transfer it. If you wanted to send data to someone very far away, you need to physically travel with the floppy disk or mail (via the post office) to the person, so that they receive the data. No need to tell you how tedious this was.
Eventually, computer networks were created, where computers could communicate and share data. This was good, but for every computer to share information in a coordinated way, that could be understood by any other computer, a protocol had to be established. This gave birth to the TCP/IP protocol (Transfer Control Protocol/Internetwork Protocol) on the 1st of January 1983. This allowed different kinds of computers on different networks to communicate with each other.
This was the birth of the internet, the largest network of computers ever created.
The birth of Web 1:
Though we had a network of computers communicating together, the communication wasn’t user friendly, and was done via a command line interface. It was mostly used only by tech-savvy people.
In 1991, Tim Bernes-Lee introduced the world to the World Wide Web (WWW). Note that, the WWW is different from the internet. The world wide web can be thought of as an application built on top of the internet, made of a system of interconnected web pages accessible over the internet.
Basically, the WWW permitted users to navigate over the internet via web pages that are linked through hyperlinks. This was a revolution at the time. Experts say that today’s Web-3 tokens are what web pages were to the Web1 (More on that later).
To make this revolution possible, Tim Bernes-Lee had to come up with the following basic building blocks of the WWW. You can read more about this topic by following this link (https://developer.mozilla.org/en-US/docs/Web/HTTP/Basics_of_HTTP/Evolution_of_HTTP#:~:text=HTTP%20(HyperText%20Transfer%20Protocol)%20is,simplicity%20while%20shaping%20its%20flexibility.)
- A textual format to represent hypertext documents, the HyperText Markup Language (HTML)
- A simple protocol to exchange these documents, the HyperText Transfer Protocol (HTTP).
- A simple protocol to exchange these documents, the HyperText Transfer Protocol (HTTP).
- A server to give access to the document
For developers reading this, note that the first version of the HTTP protocol only allowed get requests, no post, put, delete, patch etc. 😂 Imagine you could only code APIs that only accepted Get requests.
The birth of the Web 2
Though we had websites and HTTP thanks to the web1, this was not very useful, since by that time, web pages were just like online billboards. It took us about a decade to make the WWW more interactive, and this gave birth to the Web 2.
On the web 2 as we know it today, the HTTP protocol evolved, and users of the internet can now generate content too. content is transferred on both sides (Client and server) and peer to peer too. For example, websites today are no longer billboards, on a website in addition to consuming data, you can comment on a post, create an account, edit your information, use social media, etc. This flexibility that was added to the Web 1 is what we call the web 2.
The big problem that arises on the web 2 is that every interaction goes through a middleman. Even peer-to-peer interactions like social media messaging goes through a middleman. This causes user data to be controlled by this central entity. These entities have total control over our data and sometimes misuse it. You’ve surely heard of the Facebook–Cambridge Analytica data scandal (https://en.wikipedia.org/wiki/Facebook%E2%80%93Cambridge_Analytica_data_scandal ) this was one case of misuse of user data.
NOTE: An episode “in french” about the web3 revolution is available on the Heroes Podcast
The birth of the Web 3
In 2008 there was a great financial crisis. This crisis was mostly due to big financial institutions in the USA not being reliable and trustworthy. So, someone named Satoshi Nakamoto had the idea of a peer-to-peer payment system that didn’t rely on third-party institutions such as banks. Where transactions will be written in the form of blocks linked to each other, and several computers would validate transactions and ensure the integrity of the blockchain with a consensus mechanism known as proof of work.
On the 3rd of January 2009, bitcoin was born. Satoshi Nakamoto mined the first block (genesis block) and the bitcoin network was live.
This was revolutionary because it removed the need for a “big brother” third-party institution that controls transactions and that could compromise the integrity of the system. This revolutionized peer-to-peer transactions.
Tech enthusiasts saw the big advantage the blockchain and consensus mechanisms could bring in peer-to-peer interactions of different forms, not only monetary transactions. They saw it could alleviate the need of a third party in several domains. This gave birth to several technologies like NFTs and Smart contracts that make decentralization applicable to different domains. We will dive into these in another episode.
With people becoming more aware of the issues that arise from having a centralized entity controlling interactions over the internet, the web 3 revolution started.
According to Wikipedia, the term “Web3” was coined by Polkadot founder and Ethereum co-founder Gavin Wood in 2014, referring to a “decentralized online ecosystem based on blockchain.” And in 2021 the term web3 gained popularity.
In simple terms, the web3 is an iteration of the WWW where blockchains, cryptocurrencies, smart contracts and NFTs are leveraged to provide a decentralized, trustless, permissionless internet where users own their data entirely.
We could literally say that web 3 gives power back to the people!
In more technical terms, we could say that web3 is an iteration of the WWW where data is managed by a Peer to peer (P2P) network of computers following rules defined in a protocol and secured by a majority consensus of all network participants who are incentivized with network tokens. This ensures that users who do not trust each other reach and settle agreements over the internet. This also ensures that every rule
Why is the move to Web3 a revolution?
Now that you know what is web3, you must surely have an idea why it is considered a revolution. In addition to what we mentioned above, there are several reasons why it is considered a revolution.
This killer feature makes anyone using a web 3 infrastructure the sole proprietor of his data and every asset he acquires.
For example, if you’re playing a video game and you purchase in-game tools and assets, the company owning the game can revoke your ownership of those assets. But if these assets were tied to NFTs on the blockchain, you would be the only owner of these assets even the company creating the game will not be able to tamper with your ownership rights.
Web 3 does not operate with a centralized trusted third party. Instead, it functions in a way that, every network actor is assumed to be untrustworthy. It relies on economic mechanisms involving consensus and incentives in the form of network tokens. This makes it possible for actors who do not know each other to perform transactions safely over a web3 network.
Web 3 isn’t controlled by centralized entities. Instead, ownership and control are distributed amongst network actors like builders, users, validators…
Thanks to smart contracts, web 3 can help enforce governance rules and business logic to coordinate a peer-to-peer interaction between network actors who do not trust each other. This business logic is enforced by majority consensus on the network.
To make this clearer, here is an example. If User A has an asset like an artwork tied to an NFT on a web3 network and user B wants to buy it, taking into consideration that both users have never met and do not trust each other. To ensure that the transaction goes smoothly, a smart contract could be made with the following rules: Once x amount of cryptocurrency from user B arrives to the wallet address of user A, the NFT’s ownership will be transferred to user B. Once the smart contract is executed, both users get what they want, without any issue. In contrast, on the web 2 this transaction would have required a third party who has every information about both users, provides a payment method via a bank, with the 3rd party and the bank taking a share of the transaction money, and no robust way of ensuring that one of the user cheats on the other after receiving what he wanted.
Everyone can participate equally to web3. No need for permission from a central entity who can ban you with a few clicks if they wanted to.