Talk of Web3 exploded towards the end of 2021. Facebook’s renaming to “Meta” and it’s new focus on the metaverse was undoubtedly the big news that drove much of that interest, but it wasn’t the start of it. A steady stream of news around NFTs, DeFi and broader decentralisation had pushed interest in Web3 to new heights even before Zuckerberg donned his virtual poloneck and creeped us all out.

I fell in love with the web in its infancy, instantly drawn to the “New Wild west” that it represented: A grass roots system built on the passion of individuals and largely untouched by the big corporate world. Hardly terms you would use to describe the web of today.

It can be hard to separate the true promise of Web3 from the hype that surrounds it, but there is indeed real promise to be found. The most tantalising for me is the promise of a web that could again have some of the independence that the early “Web 1.0” had.

Wait: Web 1.0, Web 2.0, Web3?? WTF???

Web3 is a vague label being applied to the next significant incarnation of the World-Wide Web. There is some disagreement on exactly what it will look like, but that shouldn’t be a surprise as it isn’t quite with us yet. It’s easier to understand if we consider the earlier eras of the web.

Web 1.0 : The static web. Content was published by a small minority and the majority of users simply consumed that content. Think of your typical business “brochure” site where the company writes the content and all the user can do is read it.
Web 2.0 : The social web. Users can add content as well as consume it. The platforms control the content, access to it and monetisation of it. Think Facebook or the prominence of user-generated reviews on Amazon.

Web3 : The ideas around Web3 are still forming and we probably won’t have a strict definition until it is established. The core, common concept that interests me is the idea of decentralisation. Rather than storing data on the servers of a giant platform, it is stored through decentralised means (such as Blockchain). The user owns their data. Rather than a tech giant.

It’s worth noting that this point is the difference between Web3 and Web 3.0. Web 3.0 is generally used to describe Tim Berners-Lee’s concept of a semantic web. This is somewhat different from the decentralised web, so I’ll stick with Web3 for clarity.

“Mat, that is very dull and not exciting at all”

Decentralisation as a concept isn’t exactly Hollywood thriller material, but the possibilities it offers are huge. Decentralisation offers a way for platform-like systems to exist solely for the interests of the users they serve. To me, that is a tantalising throw back to the spirit of the early web. Whilst I cannot deny that Web 1.0 and 2.0 were both kind to me, I’m excited to learn more about where Web3 could take us next.

Although we don’t really yet know what the third major incarnation of the web will look like, there are four concepts that look set to play a part and are of particular interest to me.

Concept 1: Blockchain

Blockchain is a way of storing data in a distributed way. Rather than storing data in a central database it is stored in a public ledger, a copy of which lives on every participating computer. Whilst that presents some significant issues around redundancy and efficiency, everyone having access to the same data brings advantages too. The most interesting ones for me are:

  • Immutable – Blockchains are ledgers. They can be added to, but not changed
  • Distributed – Everyone gets a copy. No-one can block access or delete it
  • Transparent – Anyone can access the data (note, this doesn’t mean anyone can access your information)

Blockchain is best known as the basis of Cryptocurrency. In fact it was conceived to empower Bitcoin. Because of the insane amount of financial speculation around Bitcoin and other Cryptocurrencies, it is easy to write Blockchain off as a “scam” or “fad”, but I believe that the concept of Blockchain goes far further than Cryptocurrency and the possible applications are much broader.

Concept 2: NFTs

NFTs really hit the mainstream in 2021 thanks to a flurry of high profile NFT sales. NFTs (Non Fungible Tokens) are simply a means to prove ownership of a unique asset by writing details of that ownership into Blockchain. The high-profile NFT sales of last year mostly related to either digital art or virtual property, which I have to confess don’t hold particular interest for me.

2022 looks like it will be the year for anyone with an audience to cash in on the NFT buzz by selling “collectibles”. In game equipment, sports cards, digitised fashion, music. Everything will be tokenized and sold to those with NFT FOMO. None of this holds particular interest to an old cynic like me, although I think it is great that it is putting money into the ecosystem.

There are already NFT projects addressing challenges as diverse as proving the provenance of the steak you are eating and protecting people’s health information. I’m also struggling to see a future that doesn’t involve everyday business such as event ticketing and real-estate sales adopting NFTs. These are the applications that interest me; not the speculation that the price of a digital asset might increase, but the mainstream adoption of NFTs in day to day life.

Concept 3: Smart Contracts

Smart Contracts are not a new idea. The idea of turning contracts into executable computer code was first discussed by Nick Szabo back in 1994. What makes Smart Contracts more relevant now is the emergence of Blockchain as a mechanism to run them.

Szabo originally described Smart Contracts as being like a vending machine. When the right input is received, the output happens automatically. Ignoring his optimism about the reliability of vending machines, that is a good way to think about them.

One application that springs immediately to mind is the financial exchange that happens when you complete a property purchase. I have only bought 4 pieces of real-estate in my life, but the day of completion has followed a similar stressful pattern each time: Funds are delayed as they move up the property chain, every solicitor blames the others, then they all disappear off to the pub or golf course just as things start to happen. On our last purchase we ended up homeless for 4 days and without our furniture or belongings for nearly 2 weeks as a result. Expensive, frustrating and stressful.

Imagining an alternative based on Smart Contracts is enticing. Everyone agrees the smart contract in advance then ownership is transferred automatically as electronic funds move through the system at breakneck speed without touching solicitors client accounts or waiting for someone to phone to chase a slow payment. The idea only becomes more attractive still if you begin to imagine the process not needing lawyers (no, please… imagine it).

The legal world moves slowly and I cannot imagine the thought of tying contracts to code appeals to much of that world. I don’t think this will change soon, but I do think it will change and we’ll see Smart Contracts becoming more common in other areas before it does.

Concept 4: Decentralised Apps (dApps)

The last concept I’ll cover today is Decentralised Apps, or dApps. dApps are applications built on blockchain and powered by Smart Contracts. “Pure” dApps are decentralised by nature and can function without centralised ownership or governance, with the power instead being held by those who participate.

Imagine a social network run by the users, not a tech giant, or banking run without bankers. dApps have a long way to go, but these are some of the possibilities that they offer and it is not difficult to see the appeal. The prevailing model of Venture backed businesses funding by ad impressions has done massive world harm. Maybe, just maybe community governed dApps offer an alternative.

The parallels with the early “Wild West” days of the web are not hard to find. Likewise, the dismissal of Web3 by the new establishment has echoes of how the “Information superhighway” was dismissed by so many back in the mid-nineties. Just like then, I have found myself at a turning point in my work-life and with time to explore these new frontiers.

Does this mean I am quitting work and going on a journey of Web3 discovery?

Not quite! Web3 is interesting and has promise, but my bills are very much still paid by the practicalities of Web 1.0 / 2.0 work (particularly through the advertising that much of the Web3 community hates so much). I will be dedicating time every week to exploring the potential though. Change is coming, and I don’t plan to be playing catch up when it does.

The challenge so far is to sort the signal from the noise around Web3. Web3 is inexorably tied to the work of Cryptocurrency, which can sometimes require a highly-developed bullshit detector to navigate. I’m actively looking for new sources of information and people to follow who discuss the concepts in this article without all the “rocket to the moon” nonsense that can sometimes surround it. If you have any recommendations please let me know.