A Brief Intro and Overview of Web3

Isabel Conrad and Stevenson Doughty
12/1/2022

What is Web3 and why do we care about it?

Web3 is based on blockchain technology and decentralized networks, providing users with more control, privacy, and security over their data and activities online. Web3 enables users to conduct business peer-to-peer, cutting out intermediaries and removing power from controlling entities. Web3 is less advertiser-reliant, meaning users don’t have to share their personal information or be tracked by cookies and targeted ads. The new wave of technology uses blockchains, cryptocurrencies, and NFTs, allowing individuals to own their data, and thereby giving power back to the users.

Blockchain technology and cryptocurrency

Cryptocurrencies and the token economy facilitate this decentralized model, allowing information to be stored on a distributed ledger outside the remit of any controlling entity. Here are a few key terms that will help you understand the newest version of the web:

  • Blockchain: A system of recording information in a way that makes it difficult or impossible to change, hack, or cheat. It is a digital ledger of transactions, duplicated and distributed across the entire network of computer systems on the blockchain.
  • Smart Contracts: Smart contracts are programs on the blockchain that run when specific conditions are met. They are typically used to automate the execution of a contract so all parties involved can see the immediate outcome without any intermediary’s involvement or time loss. 
  • Cryptocurrency: A digital currency that is an alternative form of payment created using encryption algorithms.
  • Bitcoin: The first decentralized digital currency and peer-to-peer payment system, which began in 2009.
  • Non-Fungible Token (NFT): Cryptographic assets on a blockchain with unique identification codes and metadata that distinguish them from each other.
  • Decentralized applications (DApps): They are like standard apps, and offer similar functions, but the key difference is that they run on a peer-to-peer network, such as a blockchain, using smart contracts. They are open-source and operate independently, without anyone or any entity controlling them. Their data and records are public, and they use a cryptographic token to help keep their network secure.
  • DeFi (Decentralized Finance): The goal of DeFi is to create a completely decentralized financial system. It eliminates the need for central authorities and enables peer-to-peer financial transactions. This system would provide enhanced transparency by allowing people to see all of the system’s financial transactions.

Why was it created?

Web3 can improve data security, scalability, and privacy beyond what is currently possible with Web2 platforms. Many believe Web3 will create new economies, new classes of products, and new services online.

  • Security: The decentralized nature of Web3's data makes it resilient against traditional attacks. Not having to focus on a single point of attack makes it incredibly difficult for hackers to steal your data.
  • Privacy: Privacy is built into your wallet. On Web3, your wallet is your identity, which isn't easily linked to your real identity. So, while someone might be able to see the activity of someone's wallet, they won't know the true identity of the wallet.
  • Permissionless: ​​Everyone has equal access to participate in Web3; all you need is an internet connection and a compatible crypto wallet.
  • Ownership: Web3 provides ownership of your digital assets in new ways. For example, if you purchase an in-app item, it is connected to your account. If you delete your account, you will forfeit  any credits and purchases. With Web3 technology, you can sell and trade your purchased items on open markets. 

Better customer experience: Due to the fading of browser cookies, acquiring customer data is harder than ever, making it incredibly challenging to deliver a personalized experience. Web3 can help solve this issue by allowing marketers to collect critical information without affecting the users.

Resources

Articles with more information about what Web3 is:

Websites to pay attention to for staying up-to-date:

  • TheVerge - DeFi, Ethereum, and Web3 news.
  • TechCrunch - Technology, science, art, and culture.
  • CoinTelegraph - Recent news about crypto industry.
  • CoinDesk - Cryptocurrency, blockchain, digital finance, and Web3 news, with analysis, video, and live price updates.
  • Decrypt - Cryptocurrency prices, breaking news, and more about Bitcoin and blockchain.
  • The Block - News and research on digital assets, such as Bitcoin, Ethereum, and more.
  • The Defiant - DeFi, Ethereum, and Web3 news. Featuring in-depth DeFi guides and analyses.

Resources for how to get involved and where to start:

  • Twitter - CT, a.k.a. Crypto Twitter, is a group of users following and reporting on the web3/crypto space.
  • Discord - Where most of the Web3 community lives within project-specific channels and servers.
  • www.MetaMask.io - Popular Ethereum-based wallet.
  • www.Phantom.app - Popular Solana-based wallet.
  • Brave Browser - Popular Web Browser with built-in Web3 wallet; pays you in BAT crypto tokens to view ads.