Episode 9 – Financial Freedom / What is Web 3?

“In a world full of reboots, sequels and prequels – you might be forgiven for thinking that Web 3 was simply a rehashed version of Webs 1 and 2, only with an even faker shark, a lame script and stars only in it for the ding-ding-kerching. 

But that couldn’t be further off the mark. Web 3 ushers in the era of your personal, digital, freedom. Free from what though, you ask?

Well, that’s what we’re here to turn our beady, bespectacled eye of illumination upon. 

Welcome to School of Block.

Before we get too excited about the potential of Web 3, and trust me – there’s some serious potential there, let’s do a quick recap of what the hell Webs 1 and 2 actually were.

Web 1, or 1.0 – don’t quite know why we need the decimal but it does sound cooler, doesn’t it? – refers to the first stage of the world wide web, from the mid nineties onwards. There were just a few content creators, putting up websites consisting mostly of static pages. Web 1.0 was essentially just an information portal where users passively received content without the opportunity to get involved. Read-only, if you like. 

Speed of access was a big issue, with websites being designed to be as light on kilobytes as possible so as not to detonate dial up modems’ paltry bandwidth . As a consequence, web 1.0 barely even had much in the way of  images, with much of the content being text based. 

But even so, web 1.0 changed the world. Suddenly we had a globally accessible, free to access, hub of information – no central authority, censorship or surveillance. Search engines like WebCrawler and AltaVista played a huge role in helping users navigate the space. We covered Tim Berners Lee’s revolutionary vision for the internet back in Episode 5, and web 1.0 got that off to a flying start. 

The potential for the internet was quickly grasped by startup minnows as well as software whales like Microsoft and the dot-com boom in the late 90s reflected investors’ awareness that the web was in the process of changing the world we lived in. 

So that’s web 1.0 – and we can define it as FREEDOM OF INFORMATION.

WEB 2.0

What’s web 2.0?

Well, the seed was set back in 1997 with the very first social network, Six Degrees. It enabled users to upload a profile and make friends with other users. The noughties was where social media really kicked off though. Friendster in 2002, quickly followed by Myspace, Facebook and Twitter, all by 2006. 

What made social media different to what had gone before? Well, as Tim Berners Lee put it, the paradigm had gone from read-only, to read-write. Now the web was somewhere the users GENERATED THE CONTENT, interacting and collaborating with each other. And arguing too, of course. 

YouTube enabled users to create and share video, as well as monetise it, while Instagram changed from being a photo filter app to, well, kind of what facebook used to be. 

What else changed in this epoch? Well, mobile internet and smartphones enabled users to access and generate content in entirely new ways. Twitter thrived from these developments – changing the very face of news by moving more quickly than any TV network could hope to. 

And how has web 2.0 influenced society? This could be an hour long film on that topic alone… but imagine the Arab Spring taking place without the people on the streets reporting what was in front of them and sharing it with their peers. Imagine a world where good science is shared equitably and without misinformation in the face of a global pandemic. Imagine a world where shady companies [Cambridge Analytica, cough] don’t receive mysterious funding, collect data on users preferences and then tailor fake news to what’s most likely to change their voting habits. 

These nameless social networks have become essentially digital monopolies, acting as a middleman and  leveraging people’s assets and data to generate profits. Remember…  if you’re not paying for the product, you ARE the product. But, web 3.0 promises to be as disruptive to this model as the social media giants were to teenagers’ social habits.

So good and bad, web 2.0 has revolutionised the way we live, shop, socialise, date and play. If we can define web 1.0 by FREEDOM OF INFORMATION, then web 2.0 is FREEDOM OF EXPRESSION.

WEB 3.0

And what about web 3.0? 

Google it and you’ll find articles from 2008 arguing that web 3.0 will be defined by computers interpreting information like humans and intelligently directing tailored content back to users. And yes of course, with every targeted advert that’s desperate for your eyeballs we’ve been seeing this for a while.

It’s not surprising these early articles didn’t capture the full potential of web 3.0, because the seed that was going to define that potential had only just been planted. That seed? Satoshi Nakomoto’s whitepaper for Bitcoin. And that’s because web 3.0 is defined by DIGITAL OWNERSHIP. 

And not just ownership of your finances, free from any central authority or permission, but ownership of your digital self, digital art, applications and devices. 

How does this work? Well, imagine if you had ownership of every post you made on social media and were rewarded for the engagement it generated… That data is yours, owned by you, and not some social media company. If it’s not on some mega-companies servers, where does this data live? How is it tracked? Well, on the blockchain. Where, cryptographically secured, it allows direct peer to peer transactions – with no social media giant, or middleman – to broker the process. In Episode 6 we talk about this in depth, but in the context of Web 3 vs Web 2 – just consider this a definite upgrade. 

The arrival of decentralised finance has meant that you don’t need a bank to earn interest on your money, and if you want to dabble in art, then the world of NFTs is opening up at an alarming rate too. What’s an NFT you ask? Well, it stands for non-fungible-token, and is essentially a one off digital token, whose provenance is verifiable and as such as value. How much value? Well, that depends on the market – right now – potentially quite a lot. 

But an NFT isn’t necessarily just artwork. It could be an in-game skin for a character, or your avatar, or some other digital item that can be used in multiple digital realms. Imagine the frustration of spending too much money [or, any money, really] on skins and collectibles in Fortnite or Fifa but without being able to resell or being able to use them anywhere else. In five years maybe your character in Fortnite can wear your Messi Barcelona shirt from Fifa, who knows?

So an NFT is really just a one off ‘thing’, in the same way every item you encounter in real life, bar money or liquid, is a unique item in its own right. This is the physical world made digital. 

Web 3.0 will also usher in the era of decentralized applications, or dApps. Run by the community on a peer to peer network, their open source nature completely cuts out the corporations and developers who currently furtively collect your data. 

One consequence of digital ownership is PERSONAL RESPONSIBILITY and CUSTODY. In this world you are responsible for your assets. If you send your bitcoin somewhere you shouldn’t, you can’t just call the bank. If you lose the private keys for your digital world, well, you might be in a bit of a pickle.  

So if web 1.0 was FREEDOM of INFORMATION, and web 2.0 FREEDOM of EXPRESSION – we can see web 3.0 as DIGITAL FREEDOM. You own and control your assets in the digital space the same way you wear clothes or store your car key. 

This is a movement from an Internet of INFORMATION to an Internet of VALUE – where each of us are able to control the value of our digital presence online, in whatever form we choose. The potential of this is, clearly, huge. 

And we don’t know yet just quite what the societal, technological and political impacts will be, in the same way Zuckerberg probably wasn’t thinking about his responsibility in global democracy when he was starting out stalking sororities at Harvard. 

But one thing’s for sure, your digital freedom is coming – from banks, from big tech and big… everything else… and we’re here to help you make the most of it. 

Next week, we’ll be talking about the different types of coins out there in the cryptosphere. They’re not ALL trying to be money, don’t you know.”