You may wonder if the opportunity to own digital data has existed from the start of the internet age. Actually, the internet is a roller coaster of development, providing users with different levels of experience and empowerment. Over the years, internet users have migrated from a read-write system, to the read-write-own system.
The web2 ecosystem refers to a read and write only system, while web3 allows internet users to read, write, and own digital properties. Blockchain technology actively influences the web3 ecosystem by providing platforms for internet users to create and own their content.
It’s expedient to understand the adoption process from web2 to web3, especially in building valuable blockchain projects and strong crypto community. You may read this piece further to discover and learn more about the web3 ecosystem.
How is Web3 Different from Web2?
Web2 and web3 are known as second-generation and third-generation of the World Wide Web respectively. Web3 is yet to be fully adopted, but developers aim to promote decentralized platforms across the internet. Thus, developers use technologies such as Artificial Intelligence (Al) to connect creatives, and allow full control of their data. This helps content creators to share information with other users without an intermediary, as opposed to web2.
In this digital age, content creation is booming, causing the world economy to be a huge beneficiary of blockchain technology. According to research, several developed countries implement cryptocurrencies, which may lead to a 2 trillion dollars global GDP by 2030.
Web3 allows smart applications to run within its ecosystem, without placing any access barrier to any internet user. A perfect example is seen in the Ethereum cryptocurrency, where developers build decentralized apps (DApps) on an existing blockchain. However, scalability is a major challenge, as transactions are slower, compared to the web2 ecosystem. Nevertheless, web3 is a safer and transparent ecosystem that protects users data from third-party infringement.
Apart from Al, developers are also implementing technologies such as smart contracts, decentralized storage, and peer-to-peer networking, to enhance users’ experience.
The Impact of Web3 on Internet Users Experience
Since web3 confers no authority on any entity or authority, it accepts all forms of payment methods. Thus, users that are usually declined certain internet services due to payment restriction, can have unrestricted access to the platforms. Conversely, the availability of various payment options and flexibility creates more job opportunities within the crypto space. Therefore, web3 impacts users experience in several incredible ways, including the following:
- Web3 provides users with personalized data experience, maximum security, and user-friendly interface.
- Users’ interaction in web3 are private, and cannot be easily traced by a third-party. This is why crypto enthusiasts prefer to carry out transactions through blockchain technology.
- Web3 allows users to utilize decentralized applications (DApps), allowing independent access to internet services, including social media networks.
- Users can earn tokens by contributing to digital services, which is known tokenization. For instance, crypto platforms give tokens as staking rewards, which can be used to trade other cryptocurrencies.
- Web3 fosters Decentralized Autonomous Organization (DAO), which is known as community governance. This allows crypto users to partake of critical voting and decision-making processes.
The Relationship Between Web3 and Blockchain
Web3 and blockchain technology are decentralized in nature, which is why one is intertwined with the other. The decentralized applications built on blockchain technology are also integrated into web3, providing financial services and social networking platforms.
Blockchain technology protects transactions through cryptography, which increases its integrity. Web3 also maximizes blockchain’s transparency and smart contracts, to provide a wide range of internet services. These smart contracts are programs that allow automatic operations, such as fund release or contract payment within a specific period of time. This has led to several web3 operations, such as Decentralized Finance (DeFi), Non-Fungible Tokens (NFTs), Decentralized marketplaces, and Decentralized social media platforms.
Gaming developers are also exploring the blockchain industry, to create independent gaming platforms which allow players to own in-game assets. Report from Cointelegraph’s Twitter account shows that gaming makes up about 49% of blockchain transactions. This also reveals there is a large number of blockchain-based gamers across the world.
Gaming statistics that may surprise you!— Cointelegraph (@Cointelegraph) May 1, 2023
– There are more than 2000+ blockchain games in existence
– Daily average for unique wallets connecting to gaming DApps was 1.13M users!
– Of all blockchain transactions, gaming volume contributed to 49% pic.twitter.com/Kd92Ip0DIx
If you think web3 gaming is just a temporary trend, you’re missing the real potential of this industry. And web3 gaming is predicted to skyrocket to $65.7B in just 4 years with a 10x increase!a financial adviser, Mando CT
The Security Concerns of Web3
Even though web3 is believed to offer optimum security than web2, it’s exposed to certain risks, which is typical of every existing technology. One of the greatest security threats in blockchain technology is smart contract hacking. Conversely, Cointelegraph recorded TerraUSD’s loss in May 2022, which is about $50 billion token value.
Another popular security threat is account or wallet thefts. There have been several complaints about users losing their NFTs or crypto wallets to internet attackers. These attackers have been successful, by tricking users to submit their personal details. Thus, if you can avoid falling prey to these internet mischiefs, your digital assets are safe.
Why Brands Should Transition from Web2 to Web3
The internet transition from web2 to web3 is an opportunity for businesses to embrace advanced web practices. The web3 movement will reshape most industries, and create opportunities for innovative products. Fortunately, there is an increased number of web3 adoption among top companies in 2023.
According to a LinkedIn post from an NFT tech guru, companies like Ticketmaster have minted upto 15 million NFT-gated tickets. Other top companies like Shopify, Opera, Coinbase, and Spotify, are also maximizing the benefits of web3, such as:
- Improving customers loyalty and value, especially on NFT-based products
- Monitoring organizations workflow effectively and integrating Al for cost reduction purposes
- Collaborating and partnering with existing web3 brands to boost business presence
- Creating a fan-base community to collect and implement customers ideas and suggestions
- Improving businesses security and transparency in the supply chain system
There are going to be pockets of web3 adoption. There are some firms that are going to see this as more of a priorityMurray Pozmanter, Managing Director of DTCC.
How Leading Organizations Adopt Web3
As mentioned earlier, DApps, DeFi, and decentralized storage are examples of web3 utilization. With these elements, organizations have been able to provide their audience with improved user experience.
- Decentralized Finance (DeFi): DeFi users can exchange digital currencies with third-party financial institutions, such as banks. Organizations adopting this approach allows their customers to buy, sell, or pay for services through crypto platforms. Although centralized exchanges like Coinbase support DeFi, its protocols are naturally decentralized.
- Decentralized Applications (DApps): Organizations that use Decentralized Applications would worry less about constantly monitoring their backend infrastructures. Since DApps are built on smart contracts, it allows automated responses or confirmation across the internet. Thus, the activities on DApps will be programmed in response to consumers’ needs.
- Decentralized Storage System: Organizations are adopting decentralized file and data storage systems, to allow creating and publishing contents remotely. Meanwhile, developers are using non-blockchain protocols like Interplanetary File System (IPFS), to implement web3 principles. This storage method is highly reliable, and can be trusted by growing businesses.
Will Web3 Stand the Test of Time?
Many developers and tech enthusiasts keep investing heavily into web3, with great hope for a promising future. Since transitioning from web2 to web3 requires huge cooperation from internet operators, metaverse was created to fill any existing void.
According to Emergence Research, the metaverse market may boost its revenue at a CAGR of 43.3% by 2030. This further explains the rapid metaverse growth across the internet. Additionally, the introduction of web3 innovative projects like NFT Labs, will create a more accessible and flexible ecosystem. Thus, web3 users will keep growing in numbers, as much as the ecosystem keeps integrating exciting features.
Web3 benefits are profitable for every user, including business owners, gamers, and public sectors. Since blockchain plays a huge role in web3 applications, its adoption has been growing massively. Whether you are a new crypto trader or a potential web3 user, there are several exciting features that await you in these ecosystems.