The internet today is broken by design.
This is why seven years ago the founder of Polkadot and co-founder of Ethereum Dr. Gavin Wood coined the term Web 3.0 — the next logical step in internet technology.
Wood envisioned a more open, trustless, and permissionless internet. Orchestrating his vision would be cryptocurrencies like Ethereum, Polkadot and Cardano.
Web 3.0 isn’t ruled by a handful of centralized authorities, like big tech, rather a democratized online community. It emerged as social media companies were no longer valued by the size of their userbase, but by something much more sinister.
“In fact, it’s increasingly not so much about that, and increasingly about the data these users generate,” Wood said in a Third Web podcast recorded in 2019. Today Silicon Valley startups are funded based on how efficiently they can harvest data. On some platforms, almost every action you take is recorded.
“This can be things like targeted advertising, but it can also be other things like just learning better about how the world works,” Wood said. “You can start to predict what people are thinking. You can start to understand the political changes afoot in a country. You can certainly predict things like the outcome of elections.”
What happens if we ignore Web 3.0?
Web 2.0, or the current version of the web, is used by more than 4 billion people. If society ignored web 3.0, and opts for more centralized dogmatism, we risk continued corruption and eventual failure in society.
Power corrupts, and absolute power corrupts absolutely, as we saw in Maoist China or the communist Soviet Union. The internet is not exempt from corruption. In fact, it’s more at risk because none of us understand it from a technical standpoint.
I can barely fix my wifi, let alone understand the code that allows me to write these words on Medium. I’ve built my own computer yet this device is still mostly indistinguishable from magic.
This is why, at its core, Web 3.0 aims to accomplish three goals—
- Be an Open Network: Cryptocurrencies are built from open-source software that can be accessed by anyone or any community of developers. Projects like Binance Smart Chain and Ethereum Classic were created from Ethereum’s programming.
- Be as Trustless as Possible: Google’s motto is “Don’t be evil.” We have to trust that the algorithms are working for us, not against us. This is hard to believe after discovering there are different search results amongst our groups of friends. Google and Amazon are not decentralized. They’re mafia organizations.
- Be Permissionless: Anyone can participate in Web 3.0. With Bitcoin anyone becomes their own bank. With Ethereum anyone can own the rights to their own artwork. Code is law. And anything adopted into the system is put through a democratic process where the community votes if it’s accepted or note. This is called a “soft or hard fork.”
Web 3.0 is here, and these are three projects to consider investing in.
1. Polkadot and Kusama
Polkadot (DOT) is the crowning project supported by the Web3 Foundation — a non-profit organization based in Switzerland. In under a year, Polkadot’s launched over 350 applications, revolutionized blockchain technology through parachains, and strives to bet against blockchain maximalism.
Polkadot is playing for keeps. It doesn’t have to be an “Ethereum Killer.” All it has to do is be the most interoperable cryptocurrency.
Web 3.0 is about connecting everyone despite your social status, political beliefs, or ideology. There’s a place for everyone.
Gavin Wood wanted the best computer scientists on the planet and he got them. He himself was the chief architect in engineering Ethereum. Without him, Ethereum would not exist in its present form — or maybe at all.
Every project that ends up on Polkadot first goes through Kusama (KSM), which is Polkadot’s pre-production platform. Kusama is a unique project that allows crypto developers to experiment with their applications before minting them on the main chain.
DOT token is trading at $22.22 and KSM $287.36 at the time of this article.
2. Ocean Protocol
Harvesting data is never going to go away. But there are more ethical ways to do it, that also level the playing field in a world of tech giants.
Launched in 2017, the Ethereum-based Ocean Protocol is a trustless, decentralized data and AI-sharing service.
It wants to be the Uniswap of data. In other words, enable everyday people and businesses to access a marketplace of data and use it for their own benefit. Last year their creator elaborated on the importance of Ocean in an interview with Coindesk —
“Many people have tried to build data marketplaces in the past, but have been held back by issues of privacy and control. With blockchain and compute-to-data, Ocean is addressing this,” McConaghy said in the interview. “So our goal is to unlock this data economy with data marketplaces, connecting the buyers and sellers of data. These can be individual humans, families, small companies, large companies, cities, nations, etc.”
OCEAN token is trading for $.60 at the time of this article.
3. The Internet Computer
If there’s one project that is furthest in the Web 3.0 race it’s the Internet Computer.
Earlier this year Internet Computer bulldozed its way into Coinmarketcap’s Top10 in record time. Overnight
DFINITY Foundation’s project became a household name amongst investors and computer geeks.
To date, the Internet Computer has created the decentralized LinkedIn, known as LinkedUp, and their own decentralized TikTok aptly titled CanCan.
Web 3.0 is about connecting everyone despite your social class, political beliefs, or ideology. There’s a place for everyone.
However, the Internet Computer has several red flags. Many of which were addressed in Coin Bureau’s breakdown of the project —
- You’ll need an Internet Identity to operate in the network. “A single identity that’s tied to everything you do.” That means if you’re banned from the network you’re screwed. No more internet for you — forever.
- The Network Nervous System (NNS) weaves together all of the Internet Computer’s protocols. It’s so powerful a central authority that, in fact, it can “make changes to the economics of the ICP token.”
- The majority of the Internet Computer code is not open-source. Access to use the blockchain is permissioned not permissionless. And the NNS seems like a single point of failure. Does that sound like a cryptocurrency to you?
- In a 2018 interview, ICP creator Dominic Williams said the project aims to comply with the law of each country it operates in. The Coin Bureau asks: “How is this possible for a protocol that is supposed to have open governance and decentralization? That doesn’t sound at all like a cryptocurrency to me.”
The Internet Computer essentially wants to replace the current version of the internet with an even more centralized version. It’s Web 3.0 in disguise and most of the crypto community was duped by its wildly swinging price.
I’ll leave you with the last paragraph of their Medium status report:
‘As we enter the new year, nearly 1,000 independently owned and operated nodes across dozens of geographically diverse data centers — each of them certified to meet high standards of performance and physical security — are approved to run special machines that will allow the ICP protocol to weave together compute capacity to create the Internet Computer.’
This means you’ll need a specially approved machine to function as an ICP node. It’s Orwellian and the opposite of what Web 3.0 aims to accomplish.
Internet Computer is trading for $116.50 at the time of this article.
The takeaway
Web 3.0 leaves us with two choices: A democratized future through decentralization, or authoritarian control at the hands of a few centralized parties.
You need not look any further than China who issued a digital Yuan earlier this year. The Chinese Communist Party can even set a timer for how long you have to spend your digital money. It’s horrifying. And the Chinese people stomach it because they have no other choice.
As Gavin Wood addresses in a Medium article, the adoption for Web 3.0 will not be fast nor clean. Some governments are racing to outlaw cryptocurrencies favoring more centralized alternatives they can try to control.
Keyword ‘try’ because the government is too clumsy to fix anything. I wouldn’t put my trust in them — or any central authority.
Web 3.0 is going to be a photo finish. And truthfully, I’m still not sure who’s going to win.
Ever since I was a child it was my dream to become a financial advisor. Unfortunately, it never came true. Therefore I am not a financial advisor and you should do your own research and not just listen to random people on the internet. Nothing contained in this publication should be construed as investment advice.