As a vision, Web3 seems to be the marketing point for all blockchain projects, but many people say their projects will lead to WEB3, but few can define what is Web3.
The first two eras of the Internet
In the first era of the internet — from the 1980s to the early 2000s — all Internet services were based on open protocols and controlled by communities.
Big Internet companies such as Yahoo, Google, Amazon, Facebook and YouTube emerged, while traditional, centralised platforms such as AOL lost much of their influence.
In the second era of the Internet, from the mid-2000s to the present, software and services built by for-profit tech companies like Google, Apple, Facebook and Amazon, quickly outstripped the ability of open protocols.
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And the explosive growth of smartphones has accelerated this trend as users migrate from open services to these more complex, centralized mobile applications.
The good news is that billions of people are getting amazing technology for free.
The bad news is that centralised platforms control everything, and they worry that start-ups and creators will take away their users and profits, limiting the ability of newcomers to expand their influence on the internet.
This makes the internet less interesting and less vibrant.
Web 3: the Third Age of the Internet
In response, the government has taken the initiative to regulate big internet companies in the same way it once regulated traditional communications networks such as the telephone, radio and television.
But in the past, communication networks were based on hardware, while the internet was based on software. This is a fundamental difference.
Once a hardware-based network is set up, it is almost impossible to rebuild it. Software-based networks, on the other hand, can be rebuilt through entrepreneurial innovation and market forces.
The Internet is the ultimate software-based network — a relatively simple core layer that connects billions of fully programmable computers at the edges. A computer connected to the internet can run any software a user chooses for free, and software is the code of the human mind, can be anything you dream of, and thus has almost unlimited design space.
The Internet is still in its infancy: in the coming decades, core internet services could be almost completely restructured, and this will be done by blockchains
Blockchain combines the best features of the first two Internet eras: a decentralized network of community governance that will eventually outperform state-of-the-art centralized services.
Why decentralize?
Decentralization is a widely misunderstood concept.
For example, it has been said that blockchain advocates decentralization to resist government censorship, which is not the main reason for decentralization.
Let’s first look at the problems with centralized platforms.
The life cycle of a centralized platform is predictable.
At first, they try to engage users, developers, and various partners in an effort to get their platform into the multilateral network effect as quickly as possible.
As the platforms’ influence steadily increased, their relationship with the ecological participants changed from positive sum to zero sum when they reached the top of the s-curve.
The easiest way for the platform to keep growing is to extract data from users and compete with third-party partners for users and profits.
As a consequence, visionary entrepreneurs, developers, and investors tend to be wary of investing too much in centralized platforms-after all, they can be blocked.
In addition, users of centralized platforms have given up some privacy and control over their data, which makes them highly vulnerable to security issues.
These problems are likely to become more apparent in the future.
Inside the blockchain
Blockchain is a network built on the internet.
It uses consensus mechanisms such as blockchains to maintain and update state, and uses cryptocurrencies to motivate consensus participants (miners/verifiers) and other network participants.
Ether is a universal programming platform that can be used for almost any purpose. Other public chains have special uses, such as bitcoin for storing value and Filecoin for distributed file storage.
The early Internet protocols were technical specifications created by working groups or nonprofit organization that relied on the interests of the Internet community to align for adoption. Blockchain solves these problems by providing economic incentives in the form of tokens to developers, maintainers, and other network participants.
Blockchain uses a variety of mechanisms to ensure that network participants work together towards a common goal — the growth of the network and the appreciation of tokens.
But it has to be admitted that today’s blockchain can not really challenge the centralised platform giant.
The core limitations are performance and scalability, which will be addressed over the next few years to build a robust stack infrastructure layer.
After that, much of the effort will turn to building applications on top of that infrastructure.
How decentralization wins
It’s one thing to say that decentralized networks should win, it’s another to say that they will. But we remain optimistic.
Software and Web services are built by developers.
There are millions of high-skilled developers in the world, and only a small percentage work for large technology companies, only a small number of people work on new products — the most important software projects in history are often created by start-ups or communities of independent developers.
“No matter who you are, most of the smartest people work for someone else.”
Decentralized Networks won the third age of the Internet for the same reason they won the first: to win the hearts and minds of entrepreneurs and developers.
One illustrative analogy is Wikipedia’s rivalry with its centralised rivals, such as Encarta, in the 2000s.
If you compared the two products in the early 2000s, it’s clear that Encarta is a better product, with a wider range of themes and greater accuracy. But Wikipedia is improving much faster because it has an active community of volunteers who are drawn to its distributed, community-driven spirit.
By 2005, Wikipedia was the most popular reference site on the Internet, and Encarta shut down in 2009.
The lesson is that when you compare centralized and distributed systems, you need to think of them as processes on the fly, not as rigid products statically.
Centralized systems are usually fully mature from the start, but only when the company’s employees improve will they become better. While initially immature, distributed systems grow exponentially as they attract new contributors.
As far as blockchain is concerned, there are multiple compound feedback loops involving developers of core protocols, supplementary developers, third-party DAPP developers, and service providers running the network… … these feedback loops can be amplified by the incentives of tokens, which, as we’ve seen in Bitcoin and Ethereum, can accelerate the growth of cryptographic communities (sometimes with negative consequences) .
The question of whether decentralized or centralized systems“Will win the next internet age” boils down to“Who will build the most compelling products”– which in turn can be understood as, “Who will get more high-quality developers and entrepreneurs”.
There is no doubt that centralised giants such as Google and Apple have big advantages, including cash reserves, a large user base and operational infrastructure.
And centralised platforms are often bundled with compelling applications at launch: Facebook has its core social functionality, while the iPhone has many key applications.
By contrast, decentralised platforms are often half-baked and have no clear-cut case studies.
So they need to go through two stages of product-market matching:
1. Set up the perfect platform to match the developer/entrepreneur, that is, the first stage of the product and the market match;
2. Let the platform/ecosystem match the end user, that is, between the second-stage product and the market.
These two phases can be difficult, leading many people (including experienced technologists) to underestimate the potential of a decentralized platform.
The next Internet ages
Decentralized Networks are not a panacea for every problem on the internet, but they offer better solutions than centralized systems.
Take Twitter’s spam problem.
Since Twitter shut down their network to third-party developers, the only company that handles Twitter spam is Twitter itself. By contrast, hundreds of companies are trying to crack down on spam with billions of dollars in venture capital and corporate dollars. But spam didn’t work.
But if the e-mail protocol is decentralized, third-party developers can build on it without having to worry about Twitter changing the rules of the game to make it disappear.
Blockchain is a powerful way to develop community-owned networks and to level the playing field for third-party developers, creators and businesses.
We saw the value of decentralized systems in the first era of the internet, and hopefully we’ll see it again the next time.
A central insight in blockchain design is the addition of economic incentives, and cryptocurrencies are tokens built into a particular blockchain that provide a way to motivate individuals and groups to participate, maintain, and build services.
Internet services could also have the idea of tokens, but blockchains and cryptocurrencies could do something for cloud services.
It will take 20 years for open source software to replace proprietary software, and it may take just as long for open services to replace proprietary services.
But the benefits of such a shift would be huge — we could trust the software that the community owns and operates, not the company, and shift the rules of the internet from“Don’t be evil” to“Don’t be evil.”.
The Internet used to control its most important services, shifting from open-source agreements maintained by the non-profit community to proprietary services run by big tech companies.
But the movement from the blockchain and cryptocurrency worlds is building new internet services, combining the power of modern, centralized services with the community-led spirit of the original Internet, and we should embrace it.
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