Intro to Web3

Howdy,

Last week we discussed building offline.

But what if we could build online in a way that gave more power to users (you & me), as opposed to large tech companies and institutions?

Enter web3.

If we're entering web3, what were web1 and web2?

Web1 - Sir Tim Berners Lee coins the term "World Wide Web" in the '90s and users are able to access and read information anywhere throughout the world. Think AOL, Internet Explorer, Netscape, Craigslist, Google.

Web2 - Platforms are developed to let users read and write on the internet. Users can now interact with their peers on centralized platforms. Think social media networks like Facebook, Twitter, + YouTube, and peer-to-peer marketplaces such as Uber, Doordash, and Airbnb.

Web3 - Protocols allow users to read, write, and own digital assets. Users can now claim ownership over the value they create on decentralized platforms. Think cryptocurrencies such as Bitcoin or Ethereum, non-fungible token (NFT) marketplaces such as OpenSea, and decentralized autonomous organizations (DAOs) such as DeveloperDao.

Hold up, what are cryptocurrencies, NFTs, and DAOs?

Cryptocurrency - a medium of exchange reliant on a decentralized ledger to secure transaction records, verify the transfer of ownership, and control the creation of additional currency. We have historically relied on a centralized network (such as a government or bank) to perform this same function.

NFTs - uniquely identifiable tokens that verify ownership of digital files such as photos, videos, and audio. NFTs utilize the blockchain - an encrypted, distributed ledger - to verify proof of ownership. We have historically relied on middlemen (labels for music, auction houses for art) to perform this same function.

DAOs - member-owned communities without central leadership. Members are represented by rules that are encoded as a computer program and are transparent to all. We have historically relied on centralized organizations (corporations) to perform this same function. 

Bottom Line: web3 seeks to transition power away from centralized entities (governments, corporations) and give power back to the user (you & me).

When is web3 coming?

The first big web3 splash occurred in '08 with the creation of Bitcoin. This marked the origin of the concept of the blockchain, but it wasn't until the mid-2010s that additional cryptocurrency, NFT, and DAO projects were constructed (Ethereum was launched in '15, the first NFT marketplace was built in '15, and the first DAO was created in '16.)

In other words, we're early.

I suspect that we are currently exiting the "Innovators" phase and entering the "Early Adopters" phase (see bell curve below).

So if this all sounds confusing, that's completely normal. These ideas are still being built, and the consumer tech that normalizes these concepts has not yet arrived.

Can you guess which web2 companies these are?

In order to convey just how difficult it is to envision abstract web3 concepts, let's play a web2 guessing game.

Let's say the year is 2006 (early adopters stage of web2), and I tell you that the following tech will go mainstream in the next decade:

1. Information exchange where users aggregate based upon offline connection/similar interests and create/consume user-generated content (text, images, videos).

2. Peer-to-peer marketplace that connects people to transportation based upon a rating system which indicates the safety of doing business and facilitates secure payment.

3. Internet of Things (IoT) technology that will connect multiple devices throughout the user's household so that they talk to one another via verbal command from the homeowner.

What web2 companies am I referring to here? Answers are at the bottom of the email.

If you go 3/3, I'll shout you out in next week's email. Considering we aren't verifying your answers on the blockchain (~web3 humor~), we'll have to go with an honor system. Shoot me an email if you got all 3 correct.

Here's the point of the activity: conceptualizing highly skeptical technology before it's been productized is difficult.

Web3 is too early for us to truly envision what the future holds.

Things only become clear when they hit the market and have been made accessible to broader audiences. Once that occurs, the shift that initially made no sense to us at all seems obvious in hindsight.

Thanks for reading

Go tell your friends that you learned something about web3 today,

Josh

Answers to the activity above:

1. Facebook (2004 release)

2. Uber (2009 release)

3. Amazon Alexa (2014 release)

Shoot me a note if you got all 3 correct, and I'll shout you out in next week's email!