Currently, there is a lot going on in the crypto space: New launches, corrections, crashes, talks about the end of western society. The usual stuff. But one topic I come across more often and it is Web 3. That is why in this article I want to take a look at some benefits and challenges for this topic. Keep in mind that I am no expert so a few facts might be not entirely correct. With this out of the way lets start by defining what web 3 actually is. In my understanding Web 1 was the original Internet which was used to make the basic task like sending e-mails and stuff. Web 2 came with all of these big companies like Meta or Facebook, Google and even Amazon. The centralized businesses were able to provide services that nobody can not imagine the world without. And now we are apparently on the edge towards Web 3. This is supposed to be a more decentralized way of using the Internet where everybody can get involved and make the whole experience better with additional safety features and this is where we start with the benefits.

Benefits Of Web 3

So, the main difference between Web 2 and Web 3 is the database where the application state is stored. On the one hand we have Web 2 which uses and basically owns the database and collects data permanently from its users, even though sometimes it is not completely legal or it is only possible by letting the user allow to do that. On the other hand, we have Web 3 which has no centralized database at all and where all of the data is stored on a decentralized ledger. The main point to understand here is that the backend of these applications are completely decentralized across nodes. This means that if one node is offline, the whole applications would still be online which is not the case for the Web 2 applications. Furthermore, it makes the whole system very secure. Lets assume one node gets corrupted or hacked, it will not affect the whole applications because the other nodes will not agree with the outputs of the corrupted node meaning that its output is worthless and is not contributing to the application anymore. Therefore, Web 3 applications are very difficult to manipulate due to their cryptographic blockchain and hence they are considered very secure.

Furthermore, users do not have to trust the system with their data. There will be no restrictions to register to one of these applications. There will be only a wallet and its keys necessary. Additionally, the code is open source. That means that everybody can know what the application is doing and what data is being taken, not to mention all the auditors that can audit this code. Another very interesting benefit is, that these platforms are permissionless, meaning that everybody is welcome on these applications, and everybody can make their own statements without the fear of getting banned. Of course this has bad examples as well but the freedom of speech is generally a very good thing. What I find most amazing is that everybody can bring in their own ideas. Because the code is open source users can fork the application and add their desired features to the platform or even build on top like many Ethereum applications do. Another way of participating in the development are the governance tokens which allow users to shape the future of these applications.

Challenges

Like everything in life, if there are positives there must be negatives. This is unfortunately true for this topic as well. The first challenge that has to be overcome is the scalability problem. We all know that decentralized projects are not the fastest yet, especially if they are fully decentralized. This means that they are no where near as fast as the current Web 2 platforms. In many cases users are valuing the comfort and convenience over their safety and data. That is why the current Web 2 platforms are still being used in masses. I definitely can see more users switching if this scalability issue is truly solved.

Another very important point is the one of user experience. It is somehow related to the previous challenge. Currently, it is very complicated to use Web 3 platforms for the general public. Just imagine you have to tell your grandparents that they need additional tools to use these applications. They just learned how to use FaceTime! But in all seriousness, people wont like the fact that they will need to set up a wallet, interact with the Web 3 applications, approve transactions and store keys safely. I even remember my first steps in the crypto world and on the Hive Engine. It took me a while to understand things and I am still learning new things every day!

Some other challenges that are currently present are the following. The cost component should not be neglected. In some applications you need to pay a fee to interact on this platform. This will scare a lot of people away as they can use their Web 2 applications for free. Furthermore, it takes time to update the decentralized Web 3 applications because there is not one company responsible for the updates. Most of the time suggestions must be voted by the users who are holding governance tokens which makes the process of updating things very long. In my opinion this will determine the success of the Web 3 platforms: How fast can they adapt to changes in the industry. Last but not least, I wanted to mention that transparency is a double-edged sword. This means that the open-source code can be easily exploited and any loopholes will be used to enrich the hackers.

Conclusion

To end of this article, I also want to talk about the fact that currently a lot of people are saying that most of these Web 3 applications are controlled by VCs and funds. Their point is that these projects are only decentralized on the outside and that they are truly controlled by a centralized entity. And while I can understand their arguments about the whole proof of stake and governance I still think that it is a great step in the right direction. Furthermore, a lot of critics are mentioning that the whole infrastructure is centralized. All of the decentralized applications are still being accessed by Web 2 applications and if your Internet provider decides to shut you off from the Internet you will not be able to access anything. This is also a very valid point, that is why there are projects like Helium who are trying to solve this problem. In my opinion a decentralized application will beat the centralized one over the long run. Whether it will be in Finance with DeFi or on the Internet with Web 3, everything needs time and we are just at the beginning.

Published by ga38jem on
LeoFinance | Steemit
On 21th January 2022