Does Web3 Bring Hype or Value to the Internet?

Web3 is the NEXT GENERATION OF THE INTERNET, it is going to CHANGE EVERYTHING, and any company not racing to build a Web3 presence is going to FALL BEHIND.

This means what, exactly, beyond that your marketing department had better have an answer when the CEO asks about the company’s Web3 strategy?

Read more: Web3: Is There Any ‘There’ There? And if so, Where Is It?

For all the talk about Web3 — and there is a lot of it — very few people seem to know what it means, perhaps beyond it being some privacy-focused and decentralized upgrade of the internet. Push a little further, and you’ll get that people will control access to their own personal information — you know, the currency and framework marketing is built on — and it will free the Web from the tyranny of the handful of big tech firms that dominate it.

But what does it actually do better that the current internet? That’s where many non-techie boosters seem to shift out of the fast lane.

Just a Little Techie

Here’s a basic answer: Control is decentralized. Information is widely distributed.

And the emphasis on personal privacy marks a sea change we haven’t seen since the mid-’90s when Microsoft killed the Netscape Navigator browser — the key to how people accessed the Internet at the dawn of Web2 — by building its own Internet Explorer browser into the core of the Windows OS.

The way this is done — and this is as technical as we’re going to get — is through the Interplanetary File System (IPFS). It’s a decentralized storage and information retrieval system that works in much the same way as blockchains do: Data of all kinds is stored and shared across a globally distributed network of nodes, meaning all the computers connected to it.

See also: Crypto Basics Series: What’s a Blockchain and How Does It Work?

Instead of centralized cloud computing, which is controlled by a handful of big tech firms — led by Amazon Web Service (AWS), Microsoft Azure, and Google Cloud — data is stored on that network of node computers that provide storage bandwidth to any piece of information. (Yes, you’ll pay for the storage, cryptocurrencies are one solution.)

Files get a unique code — a blockchain-style “hash” that is used to allow people to find and retrieve it. They are encrypted and divided up into small chunks. Request information and those files are sent from wherever they’re stored to the requestor. Add data and a new file containing the old one is created and distributed.

The point is that there’s no central point that has control of the data. The encrypted and divided files can’t be censored or read at a central storage facility or cloud provider, and as long as one version of the file exists somewhere, it is safe. People’s personal information, such as data collected by Facebook and Twitter, is stored in a way that lets owners carry it — and control access to it — from one website to the next. Data storage and retrieval is peer to peer.

Why Bother?

So, how is that better than the current Web2?

Well, distributed information can’t be lost by taking one data bank down, and censorship or government access becomes very difficult to impossible. It’s also far harder to advertise and market to people who effectively have to opt into anything and can opt-out at will.

Which has two problems: First, what’s to stop any site you want access from demanding access to your data as the price of access?

Second: Why are companies and advertising firms going to cut their own throats by moving fully to Web3? Web2 and Web3 can coexist.

Calling it Web3 makes it sound like something new and powerful that will replace the old. But if it’s just another place for people to congregate and access interesting content sitting on top of the old Web, it’s very not unlike a metaverse, only vastly more complex.

As the developer of meme coin dogecoin said to Tesla CEO and dogecoin supporter Elon Musk in December: “Web3 right now is just something like ‘web2 except every single thing that is digital is now part of the open market and truly owned by users rather than centralized’ and all the promise and issues that come with that. Personally i just hope people keep getting smarter.”

For all PYMNTS crypto coverage, subscribe to the daily Crypto Newsletter.