Not a long time ago the Internet was all about pages where you could only read information. In contrast, now, people have an opportunity to create and share content online. So how did we get here?
Before we explore the definition of web3, it is worthwhile to break down the history of the Internet into three periods: web1, web2, and web3. Web1 is read-only, web2 is read-write and web3 is read-write-own. Let’s now figure out what it means.
Web1 was created in 1990 and featured mainly static websites, allowing users to only view information. Any online interactions were limited. The next generation of the Internet arrived in the form of web2. Instead of providing just content to users, companies also began to engage user-to-user interaction by utilizing platforms that allowed people to create content. However, big tech companies got control over the content and used it for monetary gains. For example, Amazon and Facebook collected personal information to facilitate better target marketing. Users became concerned about their data privacy and digital identity. Obviously, a decentralized version of the web with users in control of their data was a necessity. That is how web3 emerged.
It was aimed to create peer-to-peer network using blockchain technology that enabled users to take away the dominance of tech giants and get a complete ownership of their data. Users could connect with each other, share data and engage in transactions privately without depending on intermediaries. All concepts of web3 significantly contribute to the formation of a decentralized system. It means that no single centralized server can control the data, there is no central authority that governs decision-making and there is no central place to store information. Sounds nice, doesn’t it? But isn’t it too good to be true?
To answer this question, we can refer to the chart below:
It shows that the top 9% of accounts hold 80% of the whole market value of NFTs on the Ethereum blockchain. Moreover, the chart on the right depicts that only 2% of accounts own 95% of Bitcoin. Summarizing the given data, we can make a conclusion: “The advertised decentralization of power out of the hands of a few has been a re-centralization of power into the hands of fewer”.
Web3 is also accused of the existence of middlemen. A majority of decentralized applications, so-called dApps, rely on centralized services. Otherwise, it would be extremely time-consuming and capital-intensive for developers to run their own servers. Some platforms, such as Alchemy and Moralis, help build up dApps much faster.
Despite all contradictions, Web3 is still considered to be a novelty, a young and evolving system, so a lot of developers are continuing working on its improvements. We are on the way to creating a better web. Although web3 currently depends on centralized infrastructure, it takes time to build a high-quality and reliable one.