Topics Web 3.0
Bybit Learn
Bybit Learn
Apr 4, 2022

Explained: What Is Web 3.0?

Technology is ever-changing, and the term Web 3.0 has been widely used, especially as we’re at the tipping point of the web’s evolution. Beyond data decentralization, Web 3.0 boasts its ability to accurately interpret all queries both conceptually and contextually. Still, its potential is criticized for falling short of its ideals and the massive paradigm shift from Web 2.0. So, what exactly is Web 3.0 — and how will it revolutionize the tech industry and crypto in general? 

What Is Web 3.0?

In short, Web3 (or Web 3.0) is the third generation web. It’s permissionless, decentralized, and has code designs drawn from open sources. In simpler terms, Web 3.0 processes information with human-like intelligence through the assistance of artificial intelligence (AI) and machine learning, without relying on centralized platforms for data exchanges. Web3 users who participate in governance protocols own a share (token or crypto) that represents their ownership in the decentralized network. Any holders of the governance tokens have the right to vote for changes to be implemented in the network. 

Though this concept isn’t new, Tim Berners-Lee, the inventor of the World Wide Web, conceived a vision of the internet called the Semantic Web, later renamed Web 3.0. In principle, the Semantic Web is an autonomous, intelligent and transparent internet. Its advocates and developers seek to create a web of interconnected data in a decentralized structure that deviates itself from its predecessors, Web 1.0 and Web 2.0, in which data is mostly stored in centralized repositories. 

Web 3.0 may not have a single, simple definition, but we can define the framework by its key features as follows.

No Trusted Party or Permissions Needed

Web 3.0 avoids permission access through the inception of decentralization and the use of open-source software. Without the need for centralized permissions, users can interact without going through central authorities to access services of their liking. No intermediary is required for any virtual transactions among the involved parties. In other words, users’ privacy is more secure without the interference of intermediaries.

Unlike its predecessors’ applications, Web 3.0 apps are built on blockchain networks where nodes govern, contribute, maintain and improve the decentralized network. Instead of deploying an application hosted by a single cloud provider, the data of the decentralized applications (DApps) built on Web 3.0 is distributed and stored in multiple locations simultaneously. Therefore, the data is governed without a central controlling node or a single point of failure. 

Decentralized Web

Decentralization is a basic idea of Web 3.0. In the current web, the HTTP protocol requires locating information on a single point or server. This single information source represents a potential point of failure, or point of control.

Decentralization places information on more than one location and prevents or limits the potential for control or censorship. Blockchain technology ensures a permanent and unchangeable record of digital assets.

Artificial Intelligence

Web 3.0 will advance the current state of computers. Computer scientists will continue developing semantic Web concepts for computers to learn so that they can use information in ways similar to humans. The Semantic Web is an extension of the existing World Wide Web, using information with well-defined meanings. The goal of the Semantic web is to allow people and computers to work together — in voice, text or other interfaces.

Natural Language Processing (NLP) is a branch of computer science that gives computers the ability to understand written and spoken words. Growing from early usages like spell check or auto-complete, natural language processing uses advanced algorithms to enable computers to read, understand and derive meaning from words and phrases.

Use cases for NLP include spam filters that scour incoming emails. Amazon’s Alexa and Apple's Siri have voice and text interfaces. Researchers continue to use machine learning and NLP to process unstructured information, such as in detecting fake news.

Machine learning uses algorithms to help machines learn in the ways that humans do. The combination of technological advances — AI, NPL and the Semantic Web — develops intuitive computer capacity far beyond what we use today.

A Brief History of Web 1.0 and Web 2.0

Web 1.0

The origins of the internet were pioneered by Tim Berners-Lee while he was working as a computer scientist at the remarkable European research center, CERN. Lee wrote the basic technologies of the internet: HTML, URI/URL and HTTP.

  • HTML — HyperText Markup Language — is the leading formatting language of the web. It permits a uniform system for markup.
  • URI and URL — Uniform Resource Identifier (and Locator) — provides a unique address that can identify every resource on the web.
  • HTTP — HyperText Transfer Protocol — supports retrieving linked resources from anywhere on the web.

The era known as Web 1.0 began with the introduction of web browsers like Netscape Navigator. Web 1.0 consisted of static web pages stored on servers. Users enjoyed retrieving pages, innovations such as email, and news content. The early web had few interactive features until online banking and trading gradually became available.

As Web 1.0 grew in popularity and usage, innovations and developments expanded the range of web pages to include dynamic and interactive features, albeit small in number. However, Web 1.0 offered little if any opportunity for user creation.

Web 2.0

Web 2.0 is the current version of the web. It marked a change in basic assumptions from Web 1.0, changing the use of the internet fundamentally and dramatically.

Technological advances transformed the static web pages that characterized Web 1.0 into interactive, socially connected and user-generated content. From the early days of Web 2.0 to the present, companies have followed a familiar path. The first phase is to develop and launch an application. Then, the company works to enroll a large group of people. This process collects user data, monetizing the database to generate income.

One can describe Web 2.0 as an interactive read-write network and a social web. User-generated content was a major departure from Web 1.0. The design of most Web 2.0 applications enables any user to operate the software or develop content. On the current web, any user can write a thought and share it, post a video for the world to see, and interact on social media platforms like Twitter or Facebook.

Continuing Evolution of Web 2.0

Today, millions of users develop and create content in various forms, including text, graphics and video. The explosive growth of the internet in Web 2.0 resulted from its reach in distributing user-created content, which can come from a range of devices such as tablets, iPhones and Android devices.

Mobile phones support continuous interaction and connectivity with apps featuring expansive online connectivity and interaction, such as Facebook (Meta), Twitter, TikTok and Instagram. Businesses like Airbnb and Uber also use the advanced interactive capability of Web 2.0 to promote their business models.

Companies can use a wide range of web technologies or languages, like HTML5 or JavaScript. Developers can use languages to create applications that enable users to interact on the existing web. The widespread use of company apps has led to an accumulation of data and user information. These accumulations or databases become tools for marketing or use as sellable assets.

Exploiting data through advertising, data sales and marketing has grown into a massive global enterprise. The loss of control over user data has given rise to an industry of software to protect personal data. Centralized servers that hold massive databases are in turn targets for unauthorized use and control.

Web 2.0 grew as users enjoyed the many benefits of social contact, ecommerce and individual capitalism. The rapid growth of the internet led to dominant platforms with enormous revenue streams. Among the largest web companies are Google, Facebook (Meta), Apple and Amazon. The dominant Web 2.0 companies rank among the largest companies on the globe by market cap. Just as impressive as their size is the remarkably youthful age of these companies. Of the leading tech companies, Apple is the senior citizen at about 45 years, Amazon and Google are in their mid-twenties, and Facebook is a mere teenager at about 17 years.

Today, Web 2.0 is a system dominated by large technology companies that monetize databases. As a result, Web 2.0 has centralized authorities who require permissions, and users consequently lose control of user data. The original vision of the WWW was far more user-focused and democratic.

How Web 3.0 Relies on NFTs and DAOs

Non-fungible tokens and cryptocurrencies can qualify participants for roles in a blockchain’s governance, and for special status. Web 3.0 relies upon cryptocurrency and NFTs to establish systems of value. For example, protocols can use NFTs as voting shares or for other privileges related to policies and decisions. Twitter, for example, could use tokens to reward helpful tweets and comments. Reddit has experimented with using tokens to authorize control of virtual property in on-site communities. Posts and comments could generate points related to up-votes or down-votes on a given topic.

Decentralized autonomous organizations (DAOs) are internet organizations owned and managed by their members. A typical DAO makes decisions through group votes within specified election periods. DAOs are flexible, functioning as networks for freelancers, charities and venture capital pools. Ownership of a DAO’s native token is typically the way to join and to participate in decision-making and governance. DAOs use smart contracts to carry out the terms of membership.

The structure of a DAO offers many unique advantages. Membership is accessible and governance is through bottom-up, majority voting. DAOs support the pooling of funds or assets by sharing risks and rewards. There’s no agent-client conflict or CEO-versus-stakeholder tension. Community governance provides a single voice. Thus, once the DAO votes a decision, there’s no distraction concerning any party acting in self-interest, rather than group interest.

The Pros and Cons of Web 3.0

The original concept of Web 3.0 was for it to be a semantic-based web in which people and computers worked closely together. Machine learning, artificial intelligence and Semantic Web concepts will continue to make computers more accessible by incorporating text, voice and other interactive capacities.

Web 3.0 will continue to grow in new areas of usage and in ease of operation for users. With a greater focus on utility, Web 3.0 will take a different direction than the big data approach of Web 2.0. With Web 3, large tech companies may modify their products to incorporate user freedom.

Decentralization, permissionless access and greater connectivity will expand Web 3.0 far beyond the current web system. User access and control will increase because people will need fewer interactions with major platforms. Users will gain greater control over their data and the benefits generated by its use or sale.

The potential traps and pitfalls are also significant. Government regulation will be more difficult in a decentralized web structure. Problems like misinformation, disinformation and hate speech may be harder to police and prevent without centralized platforms. Business models will change to incorporate features with greater decentralization than in Web 2.0.

A decentralized web will present difficult relationships with governments — as activities will cross physical boundaries between nations. Disputes that may arise can involve the laws of more than one nation

What's Next after Web 3.0?

Charting the story of web development from 1.0 to 3.0, the consistent thread is greater integration of computers into our businesses, social interactions and everyday lives. Web 3.0 promises to put people and machines into a close and harmonious relationship of tasks, communications and dependence.

Thus far, people interact with the web by defining their needs and wishes, while computers learn to understand and execute commands. The next step could be immersive environments in which computers share in the process of creation, help decide the best course, and carry out extensive and complex sets of actions.