Baba’s Explainer – Web 3.0

• Web 2.0 has also been tremendously disruptive to certain industries to the point of being an existential threat to some of them. These are sectors that have either failed to adapt to the new web-centric business model or been slow to do so, with retail, entertainment, media, and advertising among the hardest hit.
  • Web 2.0 has spurred the growth of the gig economy, by enabling millions of people to earn income on a part-time or full-time basis by driving, renting their homes, delivering food and groceries, or selling goods and services online.
• Also, In Web 2.0, most of the data in the internet and the internet traffic are owned or handled by very few large companies. 
• This has created issues related to data privacy, data security and abuse of such data.
• There is a sense of disappointment that the original purpose of the internet has been distorted. It is in this context that the buzz around Web3 is significant. Over the past few years, owing to the popularity of crypto-currency, more discussions happened on Web3.

• As per the Web3 foundation, Web3 will deliver “decentralized and fair internet where users control their own data”.
  • Currently if a seller has to make a business to the buyer, both the buyer and seller need to be registered on a “shop” or “platform” like Amazon or any such e-commerce portal.
  • What this “platform” currently does is that it authenticates that the buyer and seller are genuine parties for the transaction.
  • Web3 tries to remove the role of the “platform”.
  • For the buyer to be authenticated, the usual proofs aided by block chain technology will be used. The same goes for the seller.
  • With block chain, the time and place of transaction are recorded permanently.
  • Thus, Web3 enables peer to peer (seller to buyer) transaction by eliminating the role of the intermediary. This concept can be extended to other transactions also.
  • Consider a social media application where one wants to share pictures with their followers. It could be a broadcast operation from the person, aided by blockchain and there is no need of social media accounts for all the participants to be able to perform this.
• The spirit of Web3 is Decentralized Autonomous Organization (DAO) which is that all the business rules and governing rules in any transaction are transparently available for anyone to see and software will be written conforming to these rules.
  •  With DAO, there is no need for a central authority to authenticate or validate. Crypto-currency and block chain are technologies that follow the DAO principle.

Web 3.0 has a few defining features:

• Decentralization: This is a core tenet of Web 3.0. In Web 2.0, computers use HTTP in the form of unique web addresses to find information, which is stored at a fixed location, generally on a single server. With Web 3.0, because information would be found based on its content, it could be stored in multiple locations simultaneously and hence be decentralized. This would break down the massive databases currently held by internet giants like Meta and Google and would hand greater control to users.
• Trustless and permissionless: In addition to decentralization and being based upon open source software, Web 3.0 will also be trustless (i.e., the network will allow participants to interact directly without going through a trusted intermediary) and permissionless (meaning that anyone can participate without authorization from a governing body). As a result, Web 3.0 applications will run on blockchains or decentralized peer-to-peer networks.
• Artificial Intelligence (AI) and Machine Learning: Web 3.0 will also use machine learning, which is a branch of artificial intelligence (AI) that uses data and algorithms to imitate how humans learn, gradually improving its accuracy. These capabilities will enable computers to produce faster and more relevant results in a host of areas like drug development and new materials, as opposed to merely targeted advertising that forms the bulk of current efforts.

• Open Network: Web 3.0 is the open network, all applications and programs are developed using open-source software.
  • Essentially the code for development, which is a virtual resource, is public for the community and the development process is also kept transparent.
• Removes Middlemen: Web 3 technology can also eliminate middlemen, allowing sellers and customers to interact directly.
  • Non-fungible tokens are already enabling much of this, largely in static digital art, but the arrangement could easily be replicated in music, films, and other mediums.
• User Control of data: Core features of Web 3.0, such as decentralization and permissionless systems, will also give users much greater control over their personal data. This may help limit the practice of data extraction and curb the network effects that have enabled the technology giants to become near-monopolies through exploitative advertising and marketing practices.
• Decentralised Monetization: In centralised content management, user-generated content typically belongs to the platform it is published but Web 3.0 can empower creators by giving them a better opportunity to monetize.
  • About 2 million professional content creators in India can benefit from this.

• Needs comprehensive Overhaul of Internet Architecture: From a technology perspective, Web3 will require deviation from the current architecture where there is a front-end, middle layer and back-end.
  • Web3’s architecture will need backend solutions for handling block chain, persisting and indexing data in block chain, peer to peer communications and so forth.
  • Similarly, the middle layer, also called the business rules layer, will need to include handling block chain-based backend.
• Regulatory Challenges: It is claimed that decentralisation can bring new types of cyber-crime in the picture. Cybercrime, hate speech, and misinformation are already difficult to police and will become even more so in a decentralized structure because of the lack of central control.
  • Cryptocurrency-based crime remains a significant issue to address, especially given that rising overall transaction volumes mean the value of illicit transactions is increasing.
• Lack of Grievance Redressal Mechanism: Due to its decentralised nature, it raises a question about whom to approach in case of grievances and who is accountable for data breach.
• Lack of Content Moderation: Web 3.0 remains silent on censorship. It might give birth to obscene and provocative things. Removal of obscene or defamatory information, photos or videos will be challenging in this network

• India has used technology in shaping its domestic socio-economic development. (Examples include Aashar, Jan Dhan, UPI, COWIN). In line, India can also leverage this early development stage of Web 3.0 by leading and playing the role of a catalyst.
• Web 3.0 can accelerate the value of India’s digital economy. With such opportunities, there is a need to encourage and incentivise the startup ecosystem to position India well on the Web 3.0 Map.
• Web 3.0 can be utilised for better user experience of digital government services as well as better-quality data for more evidence-based policymaking. From the government’s perspective, cross-ministerial services can be built more quickly through blockchain technology.
• Web 3.0’s decentralised nature can be utilised in the fields of science and research to eliminate barriers of patenting and utilising the available resources for global good.
  • For instance, blockchain technology was used to store and classify vast amounts of data relating to the virus’s DNA genome sequencing.
• Prompt actions need to be taken by nations and industrial bodies to have open, ethical, and interoperable systems with solid standards.

• To use an analogy from the movies, if Web 1.0 represented the black-and-white movie era, Web 2.0 would be the age of color/basic 3D, while Web 3.0 would be immersive experiences in the metaverse.
• Just as the 2010s were the decade when Web 2.0 became the dominant force in the global business and cultural landscape, it might be Web 3.0’s turn in the 2020s. Facebook’s name change to Meta on Oct. 28, 2021, could well turn out to be an early sign that the shift to Web 3.0 is picking up steam