WEB 3.0

- WHAT IS WEB 3.0?

It is a new paradigm for the web that not only allows conversation and interaction between its users, but also allows proactive action and helps users to make a more personalized navigation.

There are some fundamental differences between web 2.0 and web 3.0, but the most important one is decentralization.

In web 3.0, developers do not typically create or deploy applications that run on a single server or store their data in a single database.

Instead, web 3.0 applications run on blockchains, decentralized networks of many P2P nodes, or a combination of the two that form a crypto-economic protocol. These applications are known as DAPPS.

To achieve a stable and secure decentralized network, network participants (developers) are incentivized and compete to provide the highest quality services to anyone who uses the service.

Cryptocurrencies play an important role in many of these protocols. Provide an economic incentive (tokens) for anyone who wants to participate in the creation, government, contribution or improvement of one of the projects itself.

These protocols can offer a variety of different services, such as compute, storage, bandwidth, identity, hosting, and other web services that cloud providers used to provide in the past.

Except that in web 3.0, the money goes directly to the network participants. This eliminates necessary and inefficient intermediaries.

Many web infrastructure protocols such as Filecoin, Arweave, and The Graph have issued utility tokens that govern how the protocol works. These tokens also reward participants at many levels of the network.

Even native blockchain protocols like Ethereum work this way.

- NATIVE PAYMENTS

The tokens also featured a native payment layer that is borderless and frictionless. Companies like Stripe and PayPal have created tremendous value by enabling electronic payments.

These systems are too complex and still do not allow true international interoperability between the participants. It also requires you to hand over your confidential information and personal data in order to use them.

Wallets like MetaMask and Torus allow you to integrate "secure" and anonymous international payments and transactions into web 3.0 applications.

Unlike today's financial system, users do not have to go through numerous steps to interact and participate in the network.

All they need to do is download or install a wallet, and they can start sending and receiving payments "without any controls".

- A NEW WAY TO BUILD BUSINESSES

Tokens also bring with them the idea of ​​tokenization and the realization of a token economy. Take, for example, the current state of building a software company.

Someone comes up with an idea, but to start building it needs money to stabilize. To get the money, take venture capital and give away a percentage of the company. This investment will negatively influence the user experience.

Also, if the company is successful in the future, it will take a long time for anyone involved to realize the value, often taking years of work with no real return on investment.

Imagine instead that an exciting new project is announced that solves a real problem. Anyone can participate in its construction or investment from day one.

The company announces the release of "X" number of tokens, giving 10% to early builders, putting 10% up for public sale, and reserving the rest for future contributors and project funding.

Interested parties can use their tokens to vote on future changes to the project, and people who help build the project can sell some of their properties to earn money after the tokens have been released.

People who believe in the project may buy and keep them, and people who think the project is going in the wrong direction may indicate it to reduce their involvement.

Since blockchain data is completely public and open, buyers have full transparency about what is going on. This contrasts with buying shares in private or centralized companies, where many things are often shrouded in secrecy.

This is already happening in the web 3.0 space. One example is the Radicle app (a decentralized GitHub alternative) that allows stakeholders to participate in the governance of their project.

YEARN allows stakeholders to participate in making decisions and voting on proposals. Graph, Audius, and countless other protocols and projects have issued tokens as a way to enable ownership, participation, and governance.

Offering an alternative way to build what we generally think of as a business, DAOs (Decentralized Autonomous Organizations) are gaining a lot of momentum and investment from both traditional developers and venture capital firms.

These types of organizations tokenize and flip the idea of ​​organizational structure on its head, offering real, liquid, and equitable ownership to more stakeholders and aligning incentives in new and interesting ways.

DAOs, IMHO, are the future of creating products and (what we in the past thought of as) businesses.

- HOW IDENTITY WORKS IN WEB 3.0

In web 3.0, identity also works very differently than what we are used to today.

Most of the time, in web 3.0 applications, identities will be tied to the wallet address of the user interacting with the application.

Unlike web 2.0 authentication methods such as email and password (which ask users for sensitive and personal information), wallet addresses are completely anonymous, unless the user chooses to link their own identity publicly.

If the user chooses to use the same wallet across multiple DAPPS, their identity can also be seamlessly transferred between apps, allowing them to build their reputation over time.

Protocols and tools like Ceramic and IDX already allow developers to create autonomous identities in their applications to replace traditional authentication and identity layers.

The Ethereum foundation also has an RFP in the works to define a scheme for "Login with Ethereum" that would help provide a more simplified and documented way of doing so in the future.

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