Web 3.0 Explained with a touch of Economics

I’m sure by now you have already heard about Web 3.0 and how it is about to change everything as we know it. I am assertive to report that this “new” technology will indeed change almost everything we do; from the entertainment aspect to the new jobs that it will create. Before we dig any deeper, we need to first understand how we got to this point. Here’s everything you need to know about Web 3.0, all the way from where it all begun in 1994.

Web 1.0

All this begun with the rise of the internet back in the 1990’s, with what is commonly known as Web 1.0. As a matter of fact, the internet has 3 generations apparently, with the latest being Web 2.0 that we are currently using. See when Web 1.0 was ushered in 1994, it was meant to serve as a source of knowledge.

Think of it as a large dictionary containing almost any information you could think of. People mainly used it as a research Centre. But there was one problem to this. Users could not interact with the computer or with other users for that matter. Things like sharing, liking and commenting were pretty much unheard of. Furthermore, there was no mainstream way of monetizing your content. No wonder things like hobby blogging were so famous back then.

After sometime, things started taking off with companies like Amazon and Google coming into play. People started thinking of ways on how to monetize this revolutionary technology and this is where web 2.0 made a grand entrance. This era lasted for about 13 years; from 1991 to 2004.

Web 2.0

Web 2.0 is where things start getting a bit spicy. Since we live in a capitalist society, people had to figure out how to make a living online. Companies like Amazon started online shopping while others like Facebook provided a platform for people to connect and share their thoughts and opinions. Forums like Reddit were created for people who are like minded to connect.

All this was great but how did people make money. Welcome advertisements. This is the era where advertisements really took off. Ads was by far one of the best ways to monetize any type of content. People who have profited massively from YouTube can attest to this. Other money-making ways came up as the technology got better and better. People started selling E-books, courses and recent projects such as Only-fans made people Millions of dollars. It seemed like a perfect world; Capitalism at its best. People even started claiming that there was no easier time to make money in history like the 21^st century. But was it all sunshine and rainbow? Of course not.

Companies started getting sued for privacy infiltration. One of the most notorious in this group is Facebook. Sources confirm that 98% of all Facebook’s revenue comes from Ads which should speak volumes. Sure, getting ads of the products that you love is impressive but is it worth trading it for your privacy? Some may argue yes, comment below your thoughts on this. These companies are literally selling your information like recent searches to third party Advertisers for a cut.

Remember that one time when you searched for Grammarly to assist you in writing your essay. Minutes later you went to watch a YouTube video and the first Ad you get is how you can get a 90% discount on Grammarly Premium.

Another main disadvantage to Web 2.0 is that most companies own the platforms that people use to communicate and do business. For example, in October of 2021, all Facebook servers were down world wide for a period for over 5 hours. This meant that What’s App and Instagram were down too. Remember that some people have based their entire business online. People were losing a lot of money and in addition to this there was a barrier to communication. Sources confirm that during this period, Telegram and Snapchat saw an increase in users. It was about time people thought of owning their own platforms and this is where Web 3.0 comes in.

Web 3.0

Web 3.0 is all about decentralizing the internet. Remember in the previous two generations, companies owned their own platforms making it centralized. This means if their servers were to go down, then the whole platform would be inactive for use. A good example is when all Facebook platforms were down last year (Instagram and What’s App mainly). Web 3.0 is here to give power to the consumers. But how exactly is this going to be achieved? Welcome Blockchain.

Blockchain technology is the real deal, the mastermind behind Web 3.0. All the way from making decentralized apps to the Cryptocurrencies we keep on hearing; this is what we’ve all been waiting for. Blockchain is basically built around anonymity. For those who are still confused on how this technology works, here is a simple break down.

Blockchain Explained.

Blockchain is a digital and widely distributed digital lender. This system stores information electronically and in a way that is unhackable. See, blockchain stores data in groups called blocks. Each block has a capacity to which data can be stored. When the block is fully maximized, a new block is created forming a chain hence the term Blockchain. But where is all this data being stored or retrieved? Well, its not a centralized location for sure.

This data is normally passed on in a network of computers that belongs to this blockchain. After a block is fully utilized it is ran across all these different computers around the globe making the system virtually unhackable. This is because if one was to alter with the information from one computer, it would take all the computers in the network to agree which is again virtually impossible. In addition to this, after each block is registered in a network, it is assigned a date and time which makes it even harder to alter anything.

Let’s continue with Web 3.0

With the power of blockchain, anonymity is at the core. Of course, there are some downsides like purchasing illegal items online using Bitcoin which is untraceable back to the consumer. Focusing on the upsides, cryptocurrency is likely to take over in a few years, becoming the main stream form of money exchange. In addition to this, technologies like NFTs have been made possible.

Unless you have been living under a rock, you’ve probably heard about NFTs or Non-Fungible Tokens. Although people claim it is the biggest scam of the century (more on this later), I think you should first try to understand how it works and what it is in the first place. An NFT is simply digital art in form of videos or photos that are stored in a blockchain. This means that they cannot be replicated or stolen once on the blockchain.

One of the ways that people are getting scammed, is where the owners buy the NFTs from themselves. Take this scenario, you go and make your own NFT then buy it from yourself for about, a million dollars then claim it to be worth this much. Since the blockchain is based on “anonymity” there is no way of knowing who truly bought the NFT. In the end you end up selling it for say, 2 million dollars making triple the profit from a zero investment.

Another massive way Web 3.0 is about to change the universe is through the Metaverse. The Metaverse is simply a virtual world where you can take a break from reality. No seriously, this new technology is about to change how we do things forever (gradually of course) Some of the mind-blowing things you can do in the Metaverse include shopping, going to concerts, buying land just to name a few.

People are seriously buying land virtually. Recently, there was a piece of land in decentraland that sold for $2.43 million. With this land, companies are developing real estate from malls all the way to houses. What’s even more shocking is that someone paid $450,000 just to be Snoop Dog’s neighbor in the metaverse which is just crazy.

Final thoughts.

With Web 3.0 comes greater opportunity to make even more money but scum artists are also on the rise at a very alarming rate. Choose your virtual investments wisely. Hope this mini-tutorial has enlightened you more on Web 3.0. Be sure to drop a comment below.