There are many terms used online and it can be confusing for those who do not follow the latest news and developments closely. Web 3 is a good example of a new term being used frequently in the news world, but before we begin looking more deeply into Web 3 and how it will be impacted by crypto, we must understand how things have developed to reach this point.
Web 1 and Web 2
Web 1 was the first stage of the World Wide Web as we know it today. Most Web 1 users were consuming information available on the internet and were not creating content of their own. Web 1 was based on static pages and adverts on web pages were banned. Directories were formed to allow users to retrieve information and Web 1 span roughly from 1991 to 2004.
Web 2 was born in 2004 and refers to user generated content. This led to the increase of social media content and a more fluid user experience. Web 2 is very dynamic in comparison to Web 1 and allows for more tasks to be completed than its predecessor. For example, the introduction of Web 2 means you can not only purchase a product online as you could when using Web 1, but also leave a review of the product for other people to read. So, with that in mind, what is Web 3?
What is Web 3?
Web 3 is based on artificial intelligence and machine learning. For example, if you were to browse a website looking at a product and a later switched to looking at Facebook, you may notice an advertisement for that product. The same applies to buying items on Amazon, if you click on an item, you will see recommended items that you might also want based on the product you are browsing or buying. Web 3 is all about using information to provide a personal online experience, with tech giants like Facebook hoping it becomes integral for their Metaverse, but how does cryptocurrency fit in?
In addition to the above, Web 3 is also about creating a decentralized internet. This means giving users access to decentralized applications, giving you more control over your data and greater security. There are no intermediaries involved when making transactions using blockchain and this makes the whole network more efficient. We have witnessed the introduction of new browsers based on Web 3 and these perform differently to browsers such as Chrome. The new, Web 3 based browsers block advertisements and do not track their users, which is basically the opposite of what you get when using centralized browsers.
Web 3 and Cryptocurrency
Web 3 is based on openness and transparency, which are the same values that underpin cryptocurrency. Web 3 could easily work alongside cryptocurrency in the future but there is some work to do because the technology involved is complex. Eventually, thanks to Web 3, cryptocurrency will be seen as more than an investment or payment method. Bitcoin casinos are a good example of how cryptocurrency is being adopted in the online gambling sector and cryptocurrency can already be used to purchase products online.
Permissions is another key factor of Web 3 and people can use it without having to get access from a provider. All data will be stored on the network rather than servers and any change in the data will be recorded on the blockchain. This could prove to be an issue for those who need to remain anonymous and differs somewhat from the use of cryptocurrency. For example, those who like to gamble online but want to remain anonymous can use cryptocurrency, which shows only wallet addresses following a transaction. 100% privacy is not possible, but cryptocurrency transactions are more private than bank transfers and it will be interesting to see how Web 3 will be impacted by cryptocurrency in terms of privacy.