The Gold Rush of Web 3.0

You may not be aware that a subtle re-enactment of the California Gold Rush is taking place right now. The emergence of Web 3.0 and the promise that We’re All Gonna Make It (WAGMI) has become an endearing prospect to a lot of people in the tech world, and how can you blame them? The thought of creating the future and the dizzying realization that you can hop early on this bandwagon, has motivated people and organizations to pivot to Web 3.0 and no one has taken this more seriously than Mark Zuckerberg, by bringing all his companies; Facebook, Whatsapp, and Instagram under the newly created Meta, a company that aims to be the front runner in the Web 3.0 space. The Web 3.0 movement is reminiscent of the California Gold Rush that propelled California into statehood and the mega-state that currently has a 3.09 trillion dollar GDP, which is larger than France’s 2.6 trillion dollar GDP.

To fully grasp what Web 3.0 is, we have to understand the previous versions of the Internet; Web 1.0 and Web 2.0. The Web 1.0 phase began from the inception of the internet and was the phase that laid the foundation for the internet we are familiar with today. During this phase, the internet was largely decentralised and web pages were severely limited in their capabilities. Most of the early internet was consumer-friendly and there was really no requirement for your private information. However, this all changed around 2004 with Web 2.0. The Internet became largely interactive, with centralized companies such as Alphabet, the parent company of Google, Youtube, Pixel and so many more, beginning to retrieve information from users to curate a personalized experience. Web 2.0's centralized firms changed the tide and made the Internet more organization-friendly, collecting data from us on a regular basis, prompting legitimate worries about the quantity of data they collect from consumers. Because of these corporations' insatiable thirst for data, we now live in a world where there is basically no privacy, which is why a man may receive targeted advertisements for toothpaste that he only used for a week at his mother's house. This has prompted the US Congress to express concerns about data privacy and protection, as well as their effect on global events such as the 2016 US elections and Brexit, prompting them to call Zuckerberg before Congress, where he apologized for the breach at Facebook which helped sway the 2016 US elections.

Having acquainted ourselves with the concept of Web 1.0 and Web 2.0, the internet that we use today, we can move on to Web 3.0. Simply put, Web 3.0 is an internet powered by blockchain technology, the same technology that powers cryptocurrencies. Web 3.0 aims to be the best of both worlds, combining Web 1.0's decentralisation with Web 2.0's quick expansion and usefulness while neglecting Web 2.0's incessant data collecting by huge tech conglomerates. Web 3.0 also promises to offer users complete control over their data, rejecting the assumption that anything uploaded on the Internet can never be removed.

Web 3.0 could also avoid the prospect of a repeat of the 2019 Robinhood scandal, which saw the investing firm halt trading on Gamestop stocks at Wall Street's request. This move helped remind us of the importance of decentralisation. Web 3.0 aims to achieve a world with decentralised finance where such instances cannot happen.

Despite being in the early stages, Web 3.0 has already been applied in today’s world, such as Odysee, a video-sharing platform similar to Youtube that runs on blockchain technology. Odysee assures its users that it cannot prevent the posting of a video and offers its users a better model for income generation. Another example is Sapien, a Web 3.0 social network that allows users to regain ownership of their data and ensures that content providers are rewarded. With Web 3.0 features, the users can now sell their data to corporations and earn from it.

One of the most prominent examples of Web 3.0 in today’s world has to be the boom of the Non-Fungible Tokens (NFTs) market on platforms like OpenSea, where buyers can obtain unique tokens on the Ethereum network that can be represented by pictures, paintings, music, literature or any other type of media. The sale of NFTs has reached dizzying heights with the market generating over 2 billion dollars in the first quarter last year, with popular celebrities such as Stephen Curry, Paris Hilton, Snoop Dogg, and our very own Buju, joining the bandwagon. The NFT market has also helped transfer funds that would have gone to corporations to otherwise struggling artists and has allowed artists to make a living from their art, which is a wonderful thing. The days of artists dying penniless is firmly behind us and this might not have been possible without Web 3.0.

However, just as the previous Gold Rush, there are some downsides with Web 3.0. The blockchain technology that powers Web 3.0 consumes a lot of energy to process and mine data across various decentralized servers. The large amount of power required for blockchain technology has always been a valid point of concern in the crypto space. In December last year, Iran was forced to order the suspension of approved cryptocurrency mining operations in order to relieve the immense strain on the national grid. This, however, can be reduced by a new method of data mining used by cryptocurrencies like Cardano called proof of stake, which is far more energy-efficient and eco-friendly than the previous proof of work approach, which required a lot of computational power.

There is also currently a high bar for accessing Web 3.0 because most devices do not have the capacity to access the blockchain network. This high bar can only be scaled by a server and quite frankly no one wants to have a server lying around just to access the internet, the logistics involved do not add up. Companies that provide services that give access to the blockchain network are now solving this challenge, which appears to contradict one of Web 3.0's pillars: decentralisation. These companies can easily become the centralised companies that we know today. Supporters of Web 3.0 argue that this isn't a problem because everything important exists on the blockchain network, and customers can easily switch between companies if they stray from the Web 3.0 route. This however is such a simplistic way to look at this complex problem.

Compared to Web 2.0, there is a delay in the speed with which information is processed using Web 3.0, this is because the blockchain network must authenticate each transaction. It currently can only process 3 to 4 transactions per minute, compared to Paypal’s 193 transactions per minute. This is however still early days and there are already plans in motion to increase the number of transactions per minute; such as a proposal for an increased block size and a plan to break down each transaction. Another fear with Web 3.0 is that it can easily be used by criminals to commit devious offences because of the great amount of security that decentralisation offers.

The California Gold Rush was a period in the state’s history where the residents discovered gold which launched the state into a period of economic boom. The foundations laid down during this period can be said to be responsible for the success of California, however, there were negative effects accompanying this Rush. Web 3.0 is here to stay because it represents progress and improvement. Progress is important for a society to move forward and there is still hope that we will not repeat the mistake of our Californian predecessors. For this to happen, there need to be increased efforts to address the present issues, now that we are still at the beginning phase of this exciting technology.

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