Web3 is the logical extension of cryptography. With the decentralisation of money and financial services enabled by digital currencies and blockchain networks, it seems almost inevitable that the Web will follow suit.
However, although the notion of Web3 has captured the imagination of a large portion of the technology industry in 2021, it has not matured into a fully-fledged sector characterised by actual examples of platforms, products, and services that have a significant impact on our lives. Numerous industry analysts predict that it will enjoy significant growth in 2022, with an increasing number of startups, organisations, and businesses developing excellent goods that contribute to its popularity.
However, critics assert that, rather than being a discrete, stand-alone section of the crypto sector, Web3 serves as a paradigm for the sector as a whole, a method of visualising the growth of crypto as it incorporates a range of various strands. All of these things will help Web3 have a very good year. NFTs, DeFi, and the metaverse are all part of this.
Web3! True, but what exactly is it?
“‘Web3’ appears to be the buzzword that will supplant ‘crypto’ in 2022, but we believe it is simply another way of describing the industry; and the market is currently moving towards an era of interoperability in which NFTs, digital assets, and various token types coexist peacefully,” said Nick Mancini, research analyst at crypto sentiment analytics platform Trade The Chain.
Mancini is not alone in believing that Web3 is both a vision for how crypto and blockchain should be utilised and a distinct sub-sector of crypto. Adam Soffer, Livepeer’s (LPT) product developer and inventor of the Web3 Index, agrees. He says it’s “more of a philosophy” about governance and ownership than a set of tools.
According to Soffer, one development involving Web3 this year will be the community defining precisely what it means and what it does not. According to him, there is now too much confusion about the term, with too many people mistaking it for power that comes from all over the world.
“However, it is not always what is intended or how people organise their work. Thus, although decentralisation is feasible, it is not necessary for a project to be completely decentralised in order to be Web3, “he said, adding that it is probably impossible for any project to be completely decentralised.
Founder and business development lead Jonathan Victor says that Web3, NFTs, the metaverse, and DeFi are all parts of the same thing. They are all parts of the same thing.
In reality, we’re discussing several levels of the technology stack. “NFTs, DAOs, and the metaverse necessitate a legitimately neutral base layer,” he said to Cryptonews.com.
Billions for ‘every good idea‘
Analysts think that Web3 is linked to crypto in general, or at least to different parts of it. This means that this year, Web3 is expected to grow a lot.
Last year was a watershed moment for Web3 and its variants, and I anticipate that this trend will continue until 2022. “With the industry reaching new heights, community potential will expand exponentially, increasing the demographics served by various sub-sectors,” stated Solo Ceesay, Chief Operating Officer and Co-Founder of the decentralised social marketplace Calaxy.
Ceesay adds that NFTs and the metaverse, as a subset of the Web3, will gain more momentum than other aspects of the Web3 with less sophisticated and crypto-literate audiences. This is mostly because they can be seamlessly integrated into the social and physical experiences that content providers, businesses, and other people give their users.
Other critics argue that no one segment of crypto (or the broader economy) will focus exclusively on Web3 until people have a better understanding of what the latter is all about.
“The organisations pursuing Web3 initiatives will remain venture capitalists in general, and we will see more corporate venture capital arms enter the market. Given that no one industry or organisation seems to understand what to do with the‘metaverse‘ and ‘Web3‘ landscapes yet, billions will continue to come in to finance any proposal with potential,” stated Nick Mancini.
Then again, Mancini thinks that “gaming and trade finance,” two businesses that have been growing for years, will be a good fit for a Web3 mindset and/or organisational style.
Some people in the industry think Web3 will be a big draw for community-driven brands and businesses that are innovative and creative. Web3 is often about giving more power and control over a platform or application to its users.
According to Solo Ceesay, content producers will drive the development and expansion of Web3 for a variety of reasons. This category includes authors, artists, musicians, filmmakers, and others who work in the creative arts.
“Content producers will continue to be the Web3 pioneers, given the dialogue that has been occurring within those groups, such as the fact that the concepts of ownership and monetization are among the most pressing challenges influencers are now confronted with. “Web3 technology provides a solution by enabling a more direct and efficient transfer of value between fans and content providers—a far cry from the chokehold that centralised parties exercise over this value transfer in Web2,” he said.
In addition to content production, Steve Liu, CEO of BitTorrent, believes that social media, in which we all generate shared material, will be another sector suitable for Web3 (BTT).
Infrastructure for the Web 3
While various industries are expected to gravitate toward the yet-to-be-defined Web3, a critical component of its expansion this year should be the development of the decentralised infrastructure necessary to achieve its objectives. This refers to protocols that serve as the foundation for decentralised Web3 apps.
According to Adam Soffer, the Web3 Index, which he established, is particularly interested in the network (or ‘work‘) protocols that comprise Web3’s infrastructure layer, since these protocols serve as the “basis” for the new paradigm.
He cites protocols such as Arweave (AR), Arkash, Helium (HNT), the Graph (GRT), Pocket, and Sia (SC) as examples of cutting-edge Web3 infrastructure. If Web3 is going to grow this year, these protocols will be very important to keep an eye on.
As he puts it, “What’s noteworthy here is that these protocols are assisting in the facilitation of an interoperable infrastructure that allows all sorts of new developments in Web3 while still supporting Web2 initiatives.”