From UPSC perspective, the following things are important :
Prelims level : Web 3.0
Mains level : Not Much
India has a rapidly-growing Web3 ecosystem with more than 450 active start-ups in the space that raised $1.3 billion in funding till April 2022.
What is Web 3.0?
- Web3 help users interact with decentralized applications built on blockchain technology.
- Web3 technologies like distributed ledgers, artificial intelligence, Metaverse and others aim to create the next-generation internet, which is accessible to everyone and offers benefits.
- Web2 is what we know and use today.
Why need Web 3?
- Centralization has helped onboard billions of people to the World Wide Web (www) and created the stable, robust internet infrastructure.
- At the same time, a handful of centralized entities have a stronghold on large swathes of the World Wide Web.
- They unilaterally decide what should and should not be allowed over Internet.
Key features of a Web3
- Immutable ecosystem, i.e., trust that people will download the digital product just as the original creator intended.
- Enhanced transparency and security,
- Quicker browsing performance,
- Complete user anonymity and confidentiality,
- Integrating cryptocurrency wallets with multiple blockchains,
- Complete control over the content due to decentralization.
Evolution of (world-wide) web
- The Web most of us know today is quite different from originally imagined.
- To understand this better, it’s helpful to break the Web’s short history into loose periods—Web 1.0 and Web 2.0.
(1) Web 1.0: Read-Only (1990-2004)
- The first inception of ‘Web 1.0’, occurred roughly between 1990 to 2004.
- It was mainly static websites owned by companies, and there was close to zero interaction between users – individuals seldom produced content – leading to it being known as the read-only web.
(2) Web 2.0: Read-Write (2004-now)
- The Web 2.0 period began in 2004 with the emergence of social media platforms.
- Instead of a read-only, the web evolved to be read-write.
- Instead of companies providing content to users, they also began to provide platforms to share user-generated content and engage in user-to-user interactions.
- As more people came online, a handful of top companies began to control a disproportionate amount of the traffic and value generated on the web.
- Web 2.0 also birthed the advertising-driven revenue model.
- While users could create content, they didn’t own it or benefit from its monetization.
How is Web3 prospected to be?
- The premise of ‘Web 3.0’ was coined by Ethereum co-founder Gavin Wood shortly after Ethereum launched in 2014.
- Gavin put into words a solution for a problem that many early crypto adopters felt: the Web required too much trust.
- That is, most of the Web that people know and use today relies on trusting a handful of private companies to act in the public’s best interests.
Core ideas of Web3
Although it’s challenging to provide a rigid definition of what Web3 is, a few core principles guide its creation.
- Web3 is decentralized: instead of large swathes of the internet controlled and owned by centralized entities, ownership gets distributed amongst its builders and users.
- Web3 is permission-less: everyone has equal access to participate in Web3, and no one gets excluded.
- Web3 has native payments: it uses cryptocurrency for spending and sending money online instead of relying on the outdated infrastructure of banks and payment processors.
- Web3 is secure: It operates using incentives and economic mechanisms instead of relying on trusted third-parties.
Why is Web3 important?
- Ownership: Web3 gives you ownership of your digital assets in an unprecedented way. Web3 allows for direct ownership through non-fungible tokens (NFTs).
- Censorship resistance: The power dynamic between platforms and content creators is massively imbalanced.
- Decentralized autonomous organizations (DAOs): As well as owning your data in Web3, you can own the platform as a collective, using tokens that act like shares in a company.