What is Web 3.0, and why has everyone started to need it?

web 3.0

The World Wide Web is constantly evolving and introducing new technologies and innovations. We have witnessed what the previous two generations of the Internet – Web 1.0 and Web 2.0 – have seen, and now we are waiting to see what Web 3.0 will bring us. The Web 1.0 experience was static and lacked the ability to create our own sites with a variety of content like we do today. The Web 2.0 version brought users together through social networking and dynamic sites, while sacrificing decentralisation.

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There are many explanations for Web 3.0, but all of them are not entirely clear. The reason is that it is difficult to define precisely what Web 3.0 is, as there is no strict definition. Typically, the Web 3.0 is associated with cryptocurrencies, blockchain and the meta-universe. And this is partly true, as these technologies are already creating the modern Internet. It will take much longer to get a clear picture of the Web 3.0, and no one has any idea how long. For example, the transition to Web 2.0 from Web 1.0 took about 10 years. Here we take stock of the evolutionary development of the Internet and try to figure out where we are going.

Evolution of the Internet

Web 1

In 1991, Stage I of the evolutionary development of the Internet (Web 1.0) began. It lasted until 2004. Most sites at that time were static pages with images and text. You could only read the text and nothing else. Popular sites were portfolio sites, representing a business or a person. Users were consumers, they could see the same text and read it like a newspaper. The internet was not secure, users had nothing to gain by clicking on malicious links. Advertising did not work because it was not targeted, the sites were mostly unprofitable. The sites became more dynamic with the creation of javascript and flash technologies.

Web 2

The beginning of the Web 2.0 era of the Internet was 2004, and we are in it today. Instead of websites that are only available to read, users interact with them: they communicate, post, sell and buy, use them as software. They are able to see different content, depending on their interests, which is only possible by collecting user information and analysing it. Information science and machine learning are the main tools for writing targeted content. Information is generated by users, but it is stored and managed by technology without privacy. Companies use user data to display advertisements. Users have become common products.

Web 3

A new era, Web 3.0, in which users act as owners of information, is now beginning. Information, services and companies are owned and managed by a DAO (decentralised blockchain network). If there is no president or CEO, companies are forced to move to a DAO. The source code for the services is open source. They make changes based on consensus between users. The transmission of all data is confidential and the information is protected. The copyright of the digital assets is protected and assigned to the NFT (it is a unique token that is stored in the blockchain).

All transactions are conducted using cryptocurrencies, which ensures their security and prompt transmission. Each user is anonymous and hides behind a virtual avatar. Users have the ability to connect to different virtual worlds and interact with other people and 3D models. It’s reminiscent of science fiction, but it’s already happening. In time, the transition will only accelerate. Blockchain is a disruptive technology designed to change industries by setting a whole new standard.

Why is Web 3.0 important?

If decentralized network architecture brings even a fraction of the benefits promised by Web 3.0 proponents, it could fundamentally change how people interact online and how companies make money from products and services.

Web 2.0 giants such as Amazon, Google and parent company Facebook Meta have grown rapidly, collecting and centralising petabytes of customer data and monetising it in myriad ways. The Web 3.0 global peer-to-peer network could be a great equaliser, making it harder for such companies to grow by accumulating data. People will have more control over web content and who can access and benefit from their personal data.

The business opportunities of Web 3.0, by contrast, are likely to centre around exploiting this new ability to tailor Web products and services to individual needs. For example, Web 3.0 marketing capabilities could help businesses find a better balance between privacy and personalisation than is possible on today’s web. The downside: they may find Web 3.0’s robust privacy protections a barrier to how they are already doing their digital marketing.

The greater transparency provided by immutable blockchain registers could improve customer service because both parties have access to their transaction records. Businesses would find it easier to control their supply chains by using decentralised applications to break down data stores and monitor suppliers’ actions. Real-time information sharing between supply chain actors could reduce shortages and speed up deliveries.

The Web 3.0 is also important as the infrastructure for the metaworld, a proposed three-dimensional virtual world in which digital representations of people, called avatars, interact and conduct business. The metaworld, like Web 3.0, does not yet exist, and it will also rely on blockchain or similar decentralized technology for its data and financial infrastructure, as well as on AI to make it more responsive to user wishes.

The meta-universe and Web 3.0 are interdependent on a technical and conceptual level and are therefore likely to develop in tandem. The metaworld will probably not emerge until its Web 3.0 foundations are firmly established.

Key features and technologies of Web 3.0

  • Decentralized. Unlike the first two generations of the Internet, where management and applications were highly centralised, Web 3.0 will deliver applications and services through a distributed approach that is independent of a central authority.
  • Blockchain-based. Blockchain decentralisation is a tool for distributed Web 3.0 applications and services. With blockchain, data is managed and verified in a widely distributed peer-to-peer network. Blockchain also uses a theoretically immutable registry of transactions and actions that helps authenticate and build trust between blockchain participants.
  • Cryptocurrency-enabled. Cryptocurrency is a key feature of Web 3.0, which is expected to largely replace the ‘fiat currency’ issued by state central banks.
  • Semantically organised. The idea behind the Semantic Web is to classify and store information in a way that helps ‘teach’ the AI-based system what the data means. Websites will be able to understand words in search queries in the same way as humans, allowing them to create and share better content.
  • Autonomous and with artificial intelligence. More general automation is an important feature of Web 3.0, and it will rely heavily on AI. Websites equipped with AI will filter and provide the data required by individual users.

How do Web3 applications work?

The development of ‘next generation’ applications adheres to the decentralised organisation of data, including data storage. At least part of the data of a web application is stored in a blockchain, i.e. it is decentralised.

The development of the product is not only and not so much the owner, but rather the distributed community. It manages the project through a DAO (decentralized autonomous organization).

In turn, decentralisation is the key to what cryptocurrencies and smart contracts have managed to realise in the economy: eliminating the need for trust and, therefore, for intermediaries and centralised structures.

Thus, the ideal state of the Web3 is freedom from censorship and restrictions, as well as an efficient business model without the use of hierarchical structures and traditional financial instruments.

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What are the advantages of Web 3.0?

The pros and cons of Web 3.0 are hard to name with certainty because most Web 3.0 components are new or still under development – all touted by zealots who tend to overlook the cons. Nevertheless, here are some of the benefits you can expect from a decentralised network run by its users

  • Control and privacy. Users will regain control of their online identity and data from central providers.
  • Transparency. Web 3.0 will provide better transparency of transactions and decisions.
  • Resilience. Applications delivered on decentralised networks are less vulnerable to single points of failure.
  • AI- and ML-enabled predictive and personalization will make the Internet more responsive to users.
  • Decentralised finance. This will enable transactions, including buying and selling goods and services, as well as securing credit, without requiring the approval of intermediaries.

What does this have to do with cryptocurrency?

Web 3.0 applications are built on blockchains, that is, decentralized networks of multiple peer-to-peer nodes, that is, conventionally, individual computers. These computers belong to the participants of the network, which can include both service developers, ordinary users of the service, and participants who are not involved in the use of the service at all.

Depending on the purpose of a particular service (application), the network participants provide different resources to the blockchain for use. This can be CPU or GPU processing power, it can be disk space or bandwidth, it can be validation of some action or identification of something. This delegation of resources needs to be motivated. Users should benefit from participating in the life and development of the network. One option for such motivation is cryptocurrency. Web 3.0 protocols use various tokens to encourage participants to become part of the network, to contribute digitally to the stability of the network. In this way, decentralisation is achieved.

Generally speaking, there are different uses of tokens in Web 3.0, depending on the types of tokens and the tasks that decentralised applications perform. NFT tokens, for example, can be used for identification.


On closer inspection, it may seem that Web 3.0 is a 100% utopian concept of a fully decentralised Internet that cannot be realised in reality. In many ways, such a thought is not without merit. Why? There are a number of reasons:

The move to Web 3.0 largely involves building an IT infrastructure of almost the same size as today’s Internet. This will take years, if not decades. In theory, the involvement of participants, both users and developers, could happen very quickly, but this is only in theory
The new Internet segments, the same meta-villages, will in fact remain centralised. They will continue to be run by IT giants
Web 3.0 as a concept of the new Internet implies a total loss of control over the information flows by the IT-giants that currently control the market and hence a loss of power by the elite groups behind the IT-companies
Web 2.0 has raised the comfort and usefulness of Internet usage to new heights, but in the process has discredited itself with inadequate censorship, intrusive targeting and unauthorized marketing espionage. The process of public and industry professionals resisting these negative effects has been set in motion, so development towards decentralisation in one form or another will inevitably continue.

The impact of Web 3.0 goes far beyond the Internet. As its segments develop, we will see an increasing digitalisation and decentralisation of the economy. Cryptocurrency, which motivates and involves by its perceived value a multitude of unconnected participants, is on the one hand an integral part of the Web 3.0 concept, but on the other, it creates a dangerous competition to traditional banking systems and thus to national governments. In this sense, the Web 3.0 poses a tangible danger to power-holding elites and is likely to be resisted and opposed accordingly. In addition, Web 3.0 allows users to monetize their content, and in some cases even their own online activity. This too, to a certain extent, speaks in favour of a negative attitude towards the concept on the part of the official authorities.

The most obvious and probable way for the official authorities to oppose the Web 3.0 development is to regulate cryptocurrencies, which are the lifeblood of the Web 3.0 concept, and without which it cannot be fully implemented.

Nevertheless, the development of IT technology cannot be stopped, so in reality we are likely to see some hybrid Web 2.0 model with Web 3.0 elements, which will evolve slowly and over time.

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