What is Web 3.0? What are the applications of Web 3.0

Web 3.0-Decentralized Web

In the early nineties, Netscape appeared and brought the WWW. Ten years later, the Internet has become more mature, social media and e-commerce platforms have been widely used on the Web, and Web2.0 has been launched. Social interaction brings producers and consumers closer. But there is always an intermediate platform for centralized processing. Although these platforms do a great job of creating a P2P economy and have more complex content, they also determine all the rules of the transaction and have all our data.

With the success of blockchain technology in Bitcoin, it has also successfully driven the next generation of decentralized networks and the way of Web3.0. Blockchain can bring us transactions without an intermediate platform, and Bitcoin is the first use case. Bitcoin is P2P money without banks and bank managers. It can now give us a free-rider without Uber, apartment sharing without Airbnb and social media without Facebook and Twitter.

Replace the server: redesign the data structure

The computer is connected to the computer via the Internet protocol. In the early days of personal computers, we used to save data on a floppy disk, which is the A slot. Most of the Internet data architecture adopted is still based on the client-server model. This means that our data is stored centrally on one computer and retrieved by another computer via the Internet. Although we live in a connected world, every device, whether it is a toaster or a refrigerator, is connected to the Internet, but the data is still stored centrally: stored on our USB stick or even cloud. This raises the question of trust: Can you trust the people and institutions that store the data? This centralized data structure has blind spots that cannot be solved.

From data monarch to data democracy

Since the 1990s, P2P data architectures have always existed. In these architectures, they are formed through file-sharing programs such as BitTorrent and browsers. Blockchain combines cryptography and game theory mechanisms to elevate the P2P architecture to a new level. Now we can start to move from a centralized data structure to a more decentralized or fully distributed data architecture.

In Web 3.0, data structures are being redefined, because we live in an interconnected world. The blockchain must be just one of many technologies in this distributed web stack. Although the blockchain is a good P2P way to record who did what and when it is not ideal to store large amounts of data for two reasons: (1) Scalability: the blockchain is too slow, (2) Design is not allowed: Never store private data on the Blockchain.

General Web3 stack

The transition from the client-server Internet to the decentralized network will be gradual rather than radical. As the decentralized network stack continues to mature, the transformation seems to be shifting from centralized to partially decentralized to completely decentralized. Also, it is important to point out that although decentralized architectures are more fault-tolerant and resistant to attacks, they are also slower. Although the future of the Internet may be more decentralized, this does not mean that we will completely get rid of centralized systems. Centralized systems also have advantages and may prevail, but only for specific use cases.

Application of Web 3.0

Smart contract

Sharing economy

Fundraising

Governance

By making the results completely transparent and publicly accessible, distributed database technology can provide sufficient transparency for elections or any other type of public opinion survey. Smart contracts based on Ethereum help to automate the process. The application, conference room, enables organizational decision-making to happen on the blockchain. In practice, this means that when managing digital assets, equity or information, corporate governance becomes completely transparent and verifiable.

Supply chain audit

Consumers increasingly want to know that the company’s ethical statements about its products are true. Distributed ledgers provide an easy way to prove that what we buy is authentic. Transparency comes with blockchain-based date and location timestamps-such as ethical diamonds-corresponding to product numbers. UK-based Provenance provides supply chain audits for a range of consumer products. Using the Ethereum blockchain, the Provenance pilot project ensures that the fish sold by Japanese sushi restaurants is sustainably harvested in Indonesia by its suppliers.

File storage

Distributing file storage on the Internet brings obvious benefits. Distributing data through the network can prevent files from being hacked or lost. The Internet Planet File System (IPFS) can easily conceptualize how distributed networks operate. Similar to the way BitTorrent transmits data on the Internet, IPFS does not require a centralized client-server relationship (ie the current network). The Internet consisting of completely dispersed websites has the potential to speed up file transfer and streaming time. Such improvements are not only convenient. This is a necessary upgrade to the content delivery system that is currently overloaded on the network.

Prediction market

Intellectual Property Protection

Internet of Things (IoT)

Neighbourhood microgrid

Blockchain technology can buy and sell renewable energy generated by neighbouring microgrids. When the solar panels generate excess energy, the Ethereum smart contract will automatically redistribute it. As the Internet of Things becomes a reality, similar types of smart contract automation will have many other applications.

Identity management

There is a need for better identity management on the web. The ability to verify identity is the key to financial transactions that occur online. However, the security risk remedial measures brought by online commerce are not perfect at best. Distributed ledgers provide enhanced methods to prove who you are and the possibility of digitizing personal documents. Having a secure identity is also important for online interactions – for example, in the sharing economy. After all, a good reputation is the most important condition for online transactions. The development of digital identity standards has proven to be a very complicated process. Technical challenges aside, universal online identity solutions require cooperation between private entities and governments. Also, the need to drive the legal system in different countries makes this problem extremely difficult. An E-commerce on the Internet currently relies on SSL certificates (small green locks) for secure transactions on the Internet.

AML and KYC

Anti-Money Laundering (AML) and Know Your Customer (KYC) practices have great potential to adapt to the blockchain. Currently, financial institutions must implement a labour-intensive, multi-step process for each new customer. Cross-institution client verification can reduce KYC costs while improving monitoring and analysis efficiency. The startup Polycoin has an AML/KYC solution that involves analyzing transactions. These transactions deemed suspicious will be forwarded to the compliance officer.

Data management

Today, in exchange for their personal data, people can use social media platforms such as Facebook for free. In the future, users will be able to manage and sell the data generated by their online activities. Because it can be easily distributed in small amounts, Bitcoin or something similar is likely to be the currency used for such transactions. The MIT project Enigma understands that user privacy is a key prerequisite for creating a personal data market.

Land ownership registration

As a publicly accessible ledger, blockchain can make various records more efficient. The title of property rights is an example. They are often susceptible to fraud, and management costs are high and require a lot of manpower.

Stock trading

The potential for increased efficiency in stock delivery provides a powerful use case for blockchain in stock trading. When performing peer-to-peer, transaction confirmation is almost instantaneous (instead of a three-day transaction). This may mean that intermediaries – such as settlement agencies, auditors and custodians – will be removed from the process. Numerous stock and commodity exchanges are providing prototype blockchain applications for the services they provide, including ASX (Australian Stock Exchange), Deutsche Börse (German Stock Exchange) and JPX (Japan Exchange Group). NASDAQ’s Linq is a platform for private market transactions (usually between pre-IPO startups and investors), so the most-watched is the recognized pioneer in this field. Cooperation with blockchain technology company Chain and Linq announced the completion of the first stock transaction in 2015. Recently, Nasdaq announced the development of a pilot blockchain project to conduct proxy voting on the Estonian stock market.

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