The easiest way to explain Web 3.0 for beginners is that Web 3.0 is the use something called blockchain technology to create a fairer and more secure environment when you use the internet.
Web 3.0 can help both individuals and businesses. It benefits individuals by allowing them to have better control over their personal information and online identity. For businesses, Web 3.0 technology can make things run smoother and be more efficient, removing unnecessary processes and third parties.
As Web 3.0 has developed, it has adopted a lot of jargon, including terms such as blockchain, cryptocurrency, NFTs, metaverse, smart contracts, DAOs and Dapps.
In this article about Web 3.0, written for beginners, we will explain what each of these terms mean in simple language, while also explaining how Web 3.0 solves many of the problems that current exist in Web 2.0.
The History Of The Internet: Web 1.0 and Web 2.0
To fully understand the benefits of Web 3.0 for beginners, it is first necessary to understand the previous and current version of the internet, and the main components that make up Web 3.0.
Web 1.0, also known as the “static web,” was the first iteration of the internet. It was primarily used for publishing information and was read-only, meaning that users could only consume content and not interact with it. Websites were simple and consisted of basic HTML pages with limited multimedia content. This era of the internet was characterized by a lack of user participation and control. Web 1.0 was eventually replaced by Web 2.0.
Web 2.0, also known as the “social web,” was the next evolution of the internet. It introduced interactive web applications that allowed users to create, share, and interact with content in real-time. Websites became more dynamic and started to feature multimedia content such as videos and audio. Social media platforms like Facebook, Twitter, and Instagram emerged, allowing users to connect with each other and share their thoughts and experiences. Web 2.0 was characterized by user participation and control, with users having a greater say in what content they saw and how they interacted with it.
What Is The Problem With Web 2.0 and Why Do We Need Web 3.0?
One of the main problems with Web 2.0 is the issue of data privacy and control. Large tech companies like Facebook have amassed vast amounts of user data, which they use for targeted advertising and other purposes. This has raised concerns about the privacy and security of user data, as well as the power that these companies have to shape online discussions and influence political events.
Another problem with Web 2.0 is the issue of centralized control. Most of the services we use on the internet today are provided by a small number of large companies. This gives these companies a lot of power over how we interact with the internet, and limits our ability to shape the online world in ways that are more aligned to our interests and values.
Web 3.0 seeks to address these problems by creating more decentralized and user-controlled systems. With Web 3.0, users will have more control over their data and identities, and will be able to participate in online communities and marketplaces without relying on large intermediaries. This could lead to a more open and collaborative internet that is more democratic and less subject to the control of a small number of powerful entities.
The Language of Web 3.0 For Beginners: The 8 Essential Terms You Must Know
Similar to any other topic or activity you are learning about for the first time, Web 3.0 comes with its own jargon.
Below are the definitions of the eight essential terms you must know about Web 3.0 for beginners, being blockchain, smart contracts, cryptocurrency, NFTs, DAO, Dapp, Metaverse and Articial Intelligence.
For your convenience, each heading below is linked to further in-depth articles on the topic, including further glossary definitions and ‘how to’ articles, to help you navigate the Web 3.0 space in your area(s) of interest.
Blockchain
Blockchain is a way of storing information, kind of like a big digital notebook. But what makes it special is that it’s decentralized, which means there’s no one person or company in charge of it. Instead, lots of people all around the world keep a copy of the same notebook, and they all agree on what’s written inside. This makes it very hard for someone to cheat or change things without everyone else knowing. Because of this, blockchain can be used to keep track of things like money, contracts, and even artwork in a way that’s fair and secure.
Smart Contracts
Smart contracts are digital agreements that are stored on a blockchain, which makes them really secure and trustworthy. When you create a smart contract, you set up some rules and conditions that have to be met before something can happen. When those conditions are met, the smart contract automatically executes the agreement, without anyone having to manually check or approve it. Smart contracts can be used for all sorts of things, like buying and selling things online, paying for services, and even voting in elections.
Cryptocurrency
Cryptocurrency is used to operate a blockchain. When you use cryptocurrency, like Bitcoin or Ethereum, you’re actually using a type of digital token that’s stored on the blockchain. These tokens are used to keep track of transactions and to verify that everyone is following the rules. Whenever someone wants to make a transaction on the blockchain, they use their cryptocurrency to pay a small fee, which helps to keep the network running smoothly. So, in a way, cryptocurrency is like the “fuel” that powers a blockchain, and it’s essential for making sure that the network works the way it’s supposed to.
Cryptocurrencies can be traded on exchanges, which are online platforms where buyers and sellers can exchange different cryptocurrencies, or exchange cryptocurrencies for traditional currencies like dollars or euros. These exchanges work similarly to traditional stock exchanges, allowing users to place buy or sell orders at a certain price. The price is based on supply and demand.
Cryptocurrency can also be used to buy goods and services from merchants who accept it as a form of payment. To make a purchase, you simply transfer the cryptocurrency from your digital wallet to the merchant’s wallet. Transactions are recorded on the blockchain, ensuring security and transparency.
Non-Fungible Tokens (NFTs)
NFTs are a type of digital asset that represent something unique and cannot be replicated that are stored on a blockchain. NFTs can be used to represent all kinds of things, such as artwork, music, videos, and even tweets. They are different from cryptocurrencies because each NFT is one-of-a-kind, whereas cryptocurrencies are interchangeable. When you buy an NFT, you are buying the ownership rights to a specific digital asset, which can be transferred or sold just like physical property. NFTs have become popular in the art world as a way for artists to sell digital art and receive royalties each time it is resold.
Decentralized Autonomous Organizations (DAOs)
DAOs are groups of people who come together to make decisions and take action in a decentralized and democratic way. They are similar to traditional organizations, but are run by software code and operate on a blockchain. Members of a DAO hold digital tokens that give them voting rights on proposals and decisions.
DAOs can be used for a variety of purposes, such as managing investment funds, creating new software products, or even running a social media platform. Because they are decentralized and transparent, DAOs can be more efficient and fair than traditional organizations, which often have hierarchies and hidden decision-making processes.
Decentralized Applications (Dapps)
Dapps are applications that run on a blockchain network instead of a centralized server. They are similar to regular apps, but they operate in a decentralized and transparent way, which can make them more secure and trustworthy. Dapps can be used for a variety of purposes, such as social networking, gaming, and finance.
Because they are open-source and decentralized, anyone can contribute to the development of a Dapp, and users have more control over their data and how it is used.
Metaverse
The metaverse is a virtual world that is created by the convergence of physical and digital reality. It’s a fully immersive experience that allows people to interact with each other in a virtual space, almost like a massive video game. In the metaverse, users can create and customize their own avatars, explore digital environments, and engage in a wide range of activities such as gaming, socializing, and shopping. It’s essentially an extension of the internet, but with much greater potential for immersion and interactivity.
Artificial Intelligence (AI)
AI is a type of technology that enables machines to perform tasks that would normally require human intelligence to complete. It involves creating computer systems that can learn from data, make decisions, and perform actions based on their programming.
AI is used in a wide range of applications, from voice assistants like Siri and Alexa, to generating human-like responses to text-based inputs like Google Bard and Chat GPT, to self-driving cars and facial recognition software.
By using algorithms and machine learning, AI systems can analyze large amounts of data to identify patterns and make predictions, allowing them to perform tasks with increasing accuracy and efficiency over time.
What Are The Business Use Cases of Web 3.0?
Web 3.0 has the potential to disrupt a wide range of industries, particularly those that rely heavily on centralized systems or intermediaries.
Finance
One of the most notable industries is finance, as blockchain technology and cryptocurrency have the potential to transform the way we store and transfer value. Traditional banking and payment systems may become less relevant as more people begin to use decentralized finance (DeFi) platforms and cryptocurrencies for their financial needs.
Gaming
Web 3.0 has the potential to significantly impact the gaming industry by enabling the creation of decentralized gaming platforms. In these platforms, players can own in-game assets as NFTs, trade them freely on open marketplaces, and use them across multiple games. This can create a more immersive and rewarding gaming experience, where players have real ownership and control over their assets. Furthermore, game developers can use smart contracts to automate certain game mechanics, such as tournament payouts and item distributions, reducing the need for intermediaries and increasing transparency.
Retail, Travel and Service Industries
Web 3.0 can also revolutionize digital loyalty programs in areas such as retail, travel and service industries by enabling decentralized loyalty tokens that can be earned, traded. This can create a more seamless and rewarding experience for customers, as they can accumulate loyalty points across various merchants and use them for different rewards. Smart contracts can also automate certain aspects of loyalty programs, such as token issuance and redemption, reducing the need for intermediaries and increasing efficiency.
Other Industries
Other industries that could be disrupted by Web 3.0 include real estate, supply chain management, and social media. NFTs and blockchain-based land registries could revolutionize the way we buy, sell, and manage property, while Dapps could transform supply chain management by creating a more transparent and efficient system for tracking goods.
Meanwhile, social media platforms built on blockchain technology could give users more control over their data and provide a more decentralized and democratic alternative to centralized social media giants.
Discover how various businesses are utilizing the power of Web 3.0 in our in-depth articles on business use cases.
Conclusion
In explaining Web 3.0 for beginners, it is important they understand terms such as blockchain, cryptocurrencies, smart contracts, NFTs, DApps, DAOs, the metaverse, and AI and how they each work together to create a more secure, transparent, and fair digital world. They do so by providing individuals with greater control over their data and assets, while also enabling new and innovative decentralized applications and services.
You can download our Beginners Guide To Web 3 here.
