Is it too early to get excited about Web3?
Web3 is an idea that’s getting a lot of excitement right now in enterprise tech communities.
Simply put, the idea is that we’re heading into the third iteration of the Internet – after the World Wide Web (which bought web pages from us) and social media (which bought user-generated content from us) .
Although there is a lot of ongoing debate on the subject of what exactly web3 will be, a brief summary is that it will be decentralized, trustless and permissionless, run autonomously via artificial intelligence (AI) and built on blockchain technology. If this all sounds like gibberish, I explain these concepts in a bit more detail here!
So there’s definitely a lot of hype around the idea, but what’s still not entirely clear is how much value it actually creates. In fact, some have expressed fears that we are headed for a situation similar to what we experienced with Internet 1.0 in the last 20 years.and century. This would put us on a collision course with another “bubble-bursting” crash – just like the dot-com crash of 2000.
This is an idea that has been put forward by some prominent thinkers in the field of technology. One person I spoke to about this is none other than Tim O’Reilly – the founder of O’Reilly Media and someone who helped coin the term “web 2.0” (as well as the term “open source”) )
Let’s look at this a bit more in depth. First, if that’s true, then would that really be a terrible thing? After all, the dot-com crash led to the emergence of the internet as we know it today. Yes, a lot of investors and venture capitalists have lost money, but has it really had that much impact on the average person’s daily life? It is certainly debatable.
But things are a little different this time around. After the dot-com crash, several companies that had already established themselves as having the viable business models that would form the foundations of the Internet, entering the 21st century, have been able to truly prosper and grow. I’m talking about the likes of Google and Amazon. Maybe even SixDegrees – often cited as the first social network – which may not exist now but undoubtedly laid the groundwork which was later taken over by MySpace and then Facebook.
The problem here is that there doesn’t yet seem to be an equivalent of these groundbreaking innovators in the web3 realm. By that I mean companies that are creating real value with new business models and use cases that simply wouldn’t be possible without this latest iteration of the online experience.
So if everything falls apart, there may be nothing left to rise like a phoenix from the ashes and usher in the brave new decentralized world that awaits us.
This is a view advanced by O’Reilly (and others), and one of the reasons why he thinks we are perhaps all a little premature in our enthusiasm and enthusiasm for all things the Web3.
Joining me for a conversation recently, he said, “The way I think about it is that there’s a little disconnect between frenzy and reality…the internet first appeared times in the late 60s, but it wasn’t until the World Wide Web arrived…in 91 or 92…that we actually had the “killer app” for the internet.
If you’ve been following the hype and excitement that has built up around the concept of a decentralized, self-contained web3, you might suggest that NFTs – non-fungible tokens – are the “killer app”. After all, they are sold to us based on their potential to leave digital assets with qualities such as rarity and uniqueness. It certainly seems like a game-changer in a world where the metaverse – digital realities where we live out our lives in immersive environments – is seemingly just around the corner. In such a world, for anything – from a house to a pair of shoes – to have value, wouldn’t it need to be unique, so that it could not simply be copied? and pasted to create an infinite amount of duplicates?
Well, it’s a possibility, but O’Reilly isn’t necessarily convinced: “I’m a bit more interested in DAOs (Decentralized Autonomous Organizations) – because I think there’s something really potentially interesting.
A DAO is a concept that has been described as an “internet community with a shared bank”. They act similarly to companies or statutory organizations in that members are required to follow a set of rules and regulations. The difference is that the rules are governed by blockchain-based smart contracts that can automatically perform functions – such as payments – when conditions are met.
“But it’s still so early…we’re at the very beginning…if you think back to the first search engine, Web Crawler was in 1994 – and you started having this thing called CGI where you could have a site dynamic web rather than a static site around the same time we’re kind of at that stage – so we’ve got the late stage bubble five years too early Huge fortunes are being made, long before technology is really developed or winning players have emerged.
“If we match the timelines…the ‘Google crypto’ still isn’t here. It may not be here for another five years, and yet…companies are valued as if they’re already in this mainstream, functional future. .
What’s missing is a way to generate real value – which often means money. With the first iteration of the Internet, it can be said that this did not happen until the invention of pay-per-click (PPC) advertising, pioneered by Google in the early 2000s. Before that, companies jumped on various bandwagons, starting with the concept of commercial websites and later moving on to banner ads. Although both have served their purpose of enabling business organizations to establish a presence on the nascent web and begin to develop a digital footprint, this has not resulted in widespread acceptance of the internet as a channel for business and marketing and delivering new customers. experiences.
O’Reilly tells me, “There are so many areas where someone is going to invent a totally new way of doing something, the same way that PPC advertising has completely transformed the advertising industry – and it’s is where things like DAOs are interesting…it has different elements that make it more powerful, so people can come together and fund a project collectively…but they haven’t really understood all the ways it works, the governance, how do you actually buy real-world assets and control them… but guess what – that was how the web worked in its early days!”
It’s certainly very early for anything related to the web3 concept right now. While everyone may seem focused on what seems like the quick and easy route to earning heaps of money offered by NFTs or cryptocurrency, we have no way of knowing what real innovation might be at the Street corner. If web3 and all the concepts it encompasses – from DAOs to cryptocurrency – can really solve problems, like the huge infrastructure requirements to run existing organizational and financial systems, and trust in trust for everything articulate, then this could kick off the revolution we’ve been told is coming. But there is still a long way to go before we get there, and possibly a bumpy ride for some of the companies and individuals who are already investing money in it!
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