What is web3? Will it be a big theme in 2022?

Highlights 

• In Silicon Valley, web3 is now the hottest topic of discussion with tech titans fighting about it on social media.
• Web3, used as the abbreviation of Web 3.0, is an umbrella term that envisions the future of internet.
• What distinguishes Web 3.0 from its previous two generations is its decentralidsed nature.

Of late, there have been a lot of buzz on the internet on the term “web3” and its potential in reducing dependence on social media platforms. In Silicon Valley, it is now the hottest topic of discussion with tech titans fighting about it on social media.

So, what this web3 really is?

Web3, used as the abbreviation of Web 3.0, is an umbrella term that envisions the future of internet where ownership and power are more widely distributed. Web 1.0 was the first World Wide Web that took off in popularity in the 1990s followed by Web 2.0 in the next decade, which saw the rise of mega internet platforms like Google and Facebook. 

The vision of web3 is based on the idea of transparent digital ledgers known as blockchains. It assumes that Big Tech will be rivaled by more democratic forms of internet governance where the end user will have a say in big decisions about how platforms run, probably through a voting process.

But for many people this definition is still vague as they struggle to figure out what it really is. Tesla CEO Elon Musk, the richest person on this planet, in a Twitter post last month mentioned web3 "Seems more marketing buzzword than reality right now."

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What distinguishes Web 3.0 from its previous two generations is its decentralised nature. At present few big tech platforms such as YouTube, Instagram, Facebook, and Twitter host a significant portion of online content and due to this they get to decide who gets banned. They also take a big chunk of Silicon Valley's revenues.

The reason why people are optimistic about web3, even without its existence, is because of the development of blockchain technology and cryptocurrencies. Most of the blockchain-based digital currencies are a perfect example of decentralised, online system with no single entity overseeing it.

Now, with the growth in the market capitalisation of cryptocurrencies over the last one year, expectations that a similar decentralised model can be applied to other areas of life have also grown.

Andreessen Horowitz, a venture capital fund, that is betting big on web3, last year said crypto is not only the future of finance, it is also the future of internet and is poised to transform all aspects of our lives.

The venture capital firm defines web3 as "the internet owned by the builders and users, orchestrated with tokens." In this context, token is like a deed of ownership for a small share of the internet.

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As the thinking goes, most of us may soon own lots of tokens, with each token depicting a different asset where the value of all token are expected to rise over time.

Will Web3 be a big theme in 2022?

There are multiple use cases emerging from and on web3 such as non-fungible tokens (NFTs) with content creators likely to embrace these tools as they look for alternative ways of making money. Tools developed on web3 are likely to emerge as big themes in 2022 as online influencers will look to monetise their fan base directly and build their brands.

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Industry experts say with the use of web3 tools there will be a marked increase in the number of social tokens as well as NFTs in circulation and this will attract a new generation of creators.

For instance, TagMango is a platform, which helps creators unlock their earning potential and reduces their dependence on social media platforms such as Facebook, Instagram or Twitter. Web3 will add dimensions to how content creators can monetise their work through their fan base.

In web3, the user, for the first time, can find monetary value in interactions with their respective creators, say tech experts. And because of the sense of ownership towards their digital assets, the audience will have a high degree of loyalty towards the creator.

The contribution of Web3 in the creator economy will exponentially increase the amount and number of ways a creator can monetise, resulting in a huge increase in market capitalisation, said Mohammad Hasan, cofounder of TagMango, to a leading financial daily in India.

Similarly, a Bengaluru (India)-based creator-led social gaming and live streaming platform Eloelo is also planning to introduce products that will help monetise social and gifting tokens for creators on its platform.

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