Web3 is a decentralized platform that provides users with unprecedented control over their digital identity. Instead of using a centralized backend, users can manage all their data via a private Ethereum address, also known as an ENS profile. This address provides users with a single, anonymous login across different platforms and is censorship-resistant. Another benefit of Web3 is its ability to make payments anonymously. Unlike Web2, where users must use a bank account to make purchases, Web3 allows people to use tokens such as ETH to send and receive money directly through their browser. As a result, a trustworthy third party is not required for these transactions.
Web3 has many applications, including a cryptocurrency wallet, and it can be developed by a single organization or by a number of independent individuals. In addition, some Web3 projects are run by volunteers who contribute their time without payment. In addition, many of the larger Web3 projects seek to raise money by conducting an Initial Coin Offering (ICO). In this process, a project sells crypto tokens that can be worth more in the future. Since ICOs have become a popular way to fund projects, venture capital companies have been eager to fund projects that utilize Web3 as a platform. Additionally, many of these VC firms have experience in the software development industry and understand how to build a successful roadmap.
The Web3 ecosystem is still in its infancy. While many companies are trying to fill the gap in infrastructure, building quality, reliable infrastructure will take time. Gavin Wood coined the term “Web3” in 2014, but many of the concepts that have emerged from the initial vision have only just recently come to fruition. Among them: cryptocurrency, layer 2 scaling solutions, and revolutions in digital identity.
While Web3 is a new generation of blockchain, it shares many of the same principles of decentralization and equality of access. For example, the Chainlink network is a blockchain middleware system that lets smart contracts access off-chain resources, including traditional bank payments. Another Web3 project is Filecoin, a decentralized storage network. Basically, it is the Web3 equivalent of Google Drive or Amazon Web Services. This type of network provides the flexibility to share files, pay for space, and rent out hard drive space.
Another interesting feature of Web3 is its scalability. By enabling developers to share resources across different servers, users can use a web3 marketplace to trade computing assets globally. The iExec RLC platform makes it easy for anyone, regardless of technical knowledge, to build a web3 app.
Web3 is growing rapidly, and the future is bright for the industry. If it is able to focus on building instead of raising valuation, Web3 can achieve more and transform the way companies operate. However, there are some challenges in the short-term, such as the high costs of storing data in blockchains. Thus, hybrid Web2-Web3 ecosystems may become more common, but in the long run, Web3 dapps are expected to make significant advances in decentralized file storage.