As discussions around cryptocurrencies continue, I find myself increasingly exploring the potential of cryptocurrencies beyond their traditional definition as a means of transactional currency, where units are exchanged for products or services.
In my exploration, I often come across areas within the crypto community that are familiar to many but still relatively new to me. As someone experienced in markets, transparency is important to me, and I am open about my crypto journey. While I have a strong understanding of various topics, I see Web3 as an opportunity to expand my knowledge further.
Conceptually, the value proposition for Web3 makes perfect sense to me. Web 1.0 covered the earliest days of the text-based internet, an era of read-only websites that users “surfed” to consume content written by others.
Roughly two decades ago, Web 2.0 emerged, representing an expansion of the “read” era, characterized by users’ ability to contribute their own content, interact with others in real time via social media and garner attention for themselves (both good and bad) via their actions. This is commonly referred to as the “read-write” era, and incorporates a lot of what we do in our day to day lives.
Web3 aims to introduce the concept of “ownership” to the existing notions of transactions and data. In this context, users gain control over their data, peer-to-peer payments become possible within the network, and data is decentralized rather than being centralized in the hands of a few entities.
But why is this important? Well, speaking for myself, I’ll say this. We’re all the sum of our own experiences, to one extent or the next. And those experiences can often be distilled down into individual data points that can tell what we’ve done in the past, and heavily infer what we may likely do in the future.
Simply by interacting with this very content, you’ve likely revealed something about yourself – to an entity that you’re unaware of and that you may or may not be comfortable with.
Those pieces of information about yourself are extremely valuable to third-party businesses, some of which have built billion-dollar operations with all of our personal data at its foundation. And like an undisciplined fan revealing the ending of a movie, we’re all essentially just giving it away.
In many ways, we’ve exchanged our data as the price of admission to centralized protocols with robust networks. One mental model would be the idea that everything that you use in the physical space is rented, from your house, down to your shoes.
Web3 would conceivably turn that concept on its head, resulting in users having complete ownership and control over their data and content, with digital assets or tokens – see, there’s an angle here for a crypto publication – providing each user with property rights.
Instead of businesses being given unfettered access to your personal habits and preferences, they would conceivably have to compensate you for it.
As an individual, you would personally warehouse your own inventory of data and tokens, which you would bring with you from protocol to protocol, supplying and removing them as you see fit.
In an ideal world, the attractiveness of robust networks that we find in centralized networks would be married with greater ownership of personal data, with the blockchain acting as a trustless and permissionless vehicle to govern peer-to-peer interaction.
And if we can own something that truthfully belongs to us, and decide how and to what extent we want it distributed, I expect that people will find value in that.
So why doesn’t this already have widespread adoption? For starters, I expect that scalability is a real issue. Widespread adoption is needed for Web3 to work effectively.
Moreover, users need to not only believe in the concept of Web3 itself, but also must see value in the tokens that are used as incentive mechanisms.
It stands to reason that inertia will be a huge factor in users transitioning from the current way that they interact on the internet to a Web3 framework. People are comfortable with Web 2.0, even if that comfort level is displayed by seemingly grinning and bearing the loss of privacy and transfer of personal information.
All told, I believe that Web3 has a long way to go, but remains well on its way to getting there. I have yet to reach the individual who speaks favorably about the extent to which they lack control over the dispersion of their data.
It only makes sense to me that the alternative would be viewed in good terms. But it will take time, patience and innovation before many see it.
