Computer scientist Gavin Wood coined the term “Web 3.0” in 2014, laying out his vision for the future of the internet.
The phrase, also shortened to “Web3,” has recently become an internet buzzword with high-profile technologists, including Twitter founder Jack Dorsey and Tesla CEO Elon Musk, debating what the term means.
Wood, who is one of the co-founders of Ethereum and founder of blockchain infrastructure company Parity Technologies, sat down with CNBC on an episode of the “Beyond the Valley” podcast to discuss his Web3 vision. .
What’s wrong with the current web?
Proponents call Web3 a decentralized version of the internet – one that isn’t dominated by a handful of powerful players like Amazon, Microsoft and Google.
Web1 started with the idea of an open and decentralized Internet, but Web2 – the Internet we know today – has led to the birth of trillion-dollar technology companies that have a strong influence on the Internet. and own much of the infrastructure on which the web is built. on.
“The big problem with that is…kinda the same as putting all your eggs in one basket, if something goes wrong with one of those services, you know, the service is suddenly unavailable for a very large number of people,” Wood told CNBC’s “Beyond the Valley” podcast.
“Also, the key word here is trust. We have to trust the people behind the services. We have to trust the owners of the companies that run the service… And so yeah, we kind of managed to design ourselves ourselves into it, kind of like a dystopian version of what the world could be.”
So what is Web3?
For Wood, Web3 is truly decentralized and a more democratic version of today’s internet.
“Web3 is really kind of an alternate view of the web, where the services we use aren’t hosted by a single service provider, but rather purely algorithmic things that are, in some sense, hosted by everyone. So it’s like it’s very peer to peer, isn’t it?… The idea being that all participants somehow contribute a small piece of the ultimate service,” Wood said.
“And so no one really has an advantage over anybody else…not in the same sense, at least, as you know, when you go, for example, to Amazon or you go to eBay or Facebook, where the company behind the service really has absolute power over what they are doing providing the service.”
Web3 key terms and technology
Blockchain is a key technology behind Web3. It is most commonly associated with the bitcoin cryptocurrency and is the technology behind it. The bitcoin blockchain is a public record of bitcoin network activity. But bitcoin is not owned by a single company or person and it is not issued by a central authority like a central bank. Instead, it’s decentralized, and the network is maintained by a worldwide group of people running specialized computers.
Blockchain is therefore a key technology and decentralization an important expression.
Web3 is based on the idea of a “trustless” model. Right now, we have to trust companies to deliver the service they promise. But if Web3 products and services are built on blockchains and are decentralized, you will only have to trust the underlying algorithm to deliver that product.
This carries its own risks of course.
What could a Web3 version of Twitter look like?
Wood gave the example of a Web3 version of Twitter which he said would give users more control over their posts and make it easier to verify identities, for example.
“So it’s a lot harder for someone to like, to fake my identity, because we have … cryptographic evidence that I did this, and only I could have done it,” Wood said.
“We probably have some sort of larger elements, like free speech…in the sense that the system won’t inherently have gatekeepers which, in the same way as you know, there are Twitter employees who effectively act as gatekeepers for the system.”
Where does cryptocurrency come from?
Web3 proponents suggest that cryptocurrencies will play a key role in the future of the internet. An example might be a Web3 application that runs on a certain blockchain that uses a specific digital coin.
For example, services that run on the Ethereum blockchain may require ether-based digital tokens.
Thousands of virtual currencies have appeared over the past few years. But Wood said Web3, as he envisions it, may not be heavily dependent on cryptocurrencies.
“I suspect that currency will continue to play a role in services. But I think … overall we’re going to start to see services being provided without the need to use tokens,” Wood told CNBC.
“And I think that’s going to be a big leap. And I think that’s one of the key factors that will open the door to the mainstream,” he added, suggesting that most people probably won’t want to. buy lots of different tokens. to use a service.
How will regulation work?
Bitcoin itself has never been regulated as it is very hard to do given that it is not owned by a single entity. However, businesses that dabble in cryptocurrency in one way or another, such as exchanges, often find themselves under some sort of regulation.
So if a Web3 service is built on the same decentralization theory as bitcoin, how will regulators approach it?
For now, countries around the world are still trying to figure out the best way to regulate cryptocurrencies and related technologies. Web3 is part of this conversation.
Wood suggests that it will be difficult for authorities to regulate Web3 services themselves. Instead, it could be in an app‘s “self-interest” in terms of product to introduce rules that align with regulators, Wood said.
He added that regulators may seek to regulate “users of the service rather than the service itself”.
Will this be the end of the tech giants?
Web3 proponents suggest that with Web3, the power of the tech giants could be challenged.
However, these same companies like Microsoft and Twitter are also investing in Web3.
Wood said it would be “difficult to make a dent…in these Goliaths,” but he compared their potential fate to Microsoft in the late 2000s and beyond.
“It doesn’t matter whether you are using the Windows operating system or creating your document in Microsoft Word…we use the web as our platform, and the web can be used on any operating system”, Wood said.
“At the end of the day…hopefully Web3 will meet the needs of the future in a way that these centralized service providers can never truly meet,” he added.