Web3 (sometimes called web 3.0) and metaverse are two terms that have recently become a constant question in the world of technology. I’m sure you’ve heard them countless times in connection with Blockchain. Sometimes both terms are confusing and mistaken, using web3 for metaverse and other way around, but are they the same? The answer is no, although they are related in several important aspects, both describe different concepts. Let’s dig deeper into what metaverse and web3 are and their potential.
Before There Was Nothing, Then There Was The Internet
The Internet has profoundly altered the world as we know it. This statement is a truth that no one doubts, or almost no one. But it is worth emphasizing because it is surprisingly underestimated: the Internet has changed everything.
Think of an issue or topic that concerns you today, be it economic, political or social and a quick Google search will show you that the Internet throws a huge amount of information at you, which unfortunately is not always at the desired quality.
Judging from the start of the Internet, it can be said that there has been an evolution, from the initial web1 to today’s web2 and looking at the future of the Internet as web3. Before I talk about what web3 is, I will review previous iterations of the Internet and compare them to web3.
Web1 is different from the web2 we partially enjoy today. This earlier version primarily supports read-only functionality. This name is due to the fact that this version consisted of basic web pages. The shortcomings of web1 led to the emergence of web2. Web1 lasted 14 years, from 1991 to 2004.
Web2 is a massive update of web1, known as the read/write web or the user generated web. It saw the rise of social networking and Internet giants, such as Google, which exerted a great deal of control over this centralized version of the web.
And now we are seeing the birth of the futuristic web3. This version of the web focuses on read-write-execute or internet 3.0. The web3 operates in a decentralized manner and is set to completely replace web2 sometime in the not-too-distant future. No user will be at the mercy of any company or corporation. In this third version of the Internet every user owns the Internet and has access to information. The ownership factor is the significant difference between Web2 and Web3.
Contrary to popular belief the rumors about the evolution of Web3 began in 2006, but it wasn’t until 2014 that the term gained some popularity. Gavin Wood, co-founder of Ethereum predicted that the Internet would run on blockchain technology.
Web3: welcome to open protocols
In a single line: it’s the next era of the Internet. Web 3.0 (commonly called Web3) is a paradigm shift towards a more democratized Internet.
In simple terms Web3 is the decentralized Internet, based on distributed technologies such as Blockchain, decentralized autonomous organizations (DAOs), cryptocurrencies, virtual and augmented reality, AI and more. Driven by new technologies the Web3 movement is spearheaded by a shift in the way we, the users, view and value the Internet. Web3 is about creating an Internet that works for people and is owned by people.
Decentralization of data is one of the most important pillars, which means that instead of keeping data on central servers and giving authority to a single entity it will be stored on a network of computers. In this case each user will have a copy of his or her information. It means that we will have absolute control over our data. Web3 is far from being a reality, but we can already see the basic elements of its foundations.
Data will continue to be used for decision making, but it will not be used against the consumer. Data ownership rights will be protected rather than trampled on for profit. Incentive and market mechanisms will help ensure that information is reliable and verifiable.
A Web3 world will prioritize the sovereign individual rather than the wealthy elite and rent-seekers of the world. The restructuring of systems and protocols will focus on democratization and decentralization.
What is Metaverse?
The metaverse at the moment can be simplified as a shorthand for virtual worlds, in which users can interact with each other and relate to applications and services in a much more immersive way. The metaverse does not talk about owning the Internet. Instead, it focuses on the unique user experience when the futuristic Internet arrives. What does this mean? Users will be able to interact with each other and shop in a more immersive way. The metaverse is a virtual space where users can perform a variety of activities. Think of the metaverse as the virtual form of the real world, where physical limitations do not exist and an economic system with social impact can be created.
The metaverse aims to change the way we communicate, work and socialize. Instead of interacting with their colleagues through Zoom, users will use approaches such as VR to move between two worlds and interact with digital avatars.
The term “metaverse” first appeared in Neal Stephenson’s science fiction novel Snow Crash, describing a virtual reality world. Since then, the concept has been generalized through books and movies such as Ready Player One and the Matrix. More broadly, the term is now used to refer to any online space that strives to create immersive environments, so games like Fortnite, which has been used as a virtual concert stage, and Roblox which offers companies the ability to build branded worlds are also considered metaverse experiences.
Why do some people think they are the same thing?
Now that you know the meaning of both terms, what are their differences and similarities? I’ll start with the similarities. One important reason for their meanings to be intertwined is that the technology used to build the web3 will influence how the virtual space is used. The blockchain is used to mint NFTs and cryptocurrencies, which play a role in the metaverse.
Another reason they are talked about as if they are the same thing is that no one knows yet what exactly the terms mean. Both terms are relatively undeveloped and mean different things to people and companies who are already imagining what they will look like when they are finished. For example, Meta said it would invest $10 billion to develop its metaverse. However, its version of the metaverse is quite different from the decentralized metaverse that people think should be outside the control of companies like Meta. It is a different metaverse.
How will web3 and metaverse come together? Cryptocurrencies and NFTs will form the basis of the economy in the metaverse. If we go by what the metaverse represents (the digital version of the real world), we will likely be able to replicate in the virtual world what we do in the physical world. That means people will buy, set up businesses and make money there.
Cryptocurrencies don’t need banks and brokers for people to transact. That’s what makes them perfect for use in the metaverse. A cloud wallet is what you need to thrive in this new world. Why would anyone buy an item in the virtual world anyway? Well, there is already a market for in-game items in video games that in 2020 was said to be worth about $54 billion. Most of these are cosmetic items that players use simply to decorate their avatars, or their in-game homes, or they just like to have them to show off.
So, we’re already seeing companies like Nike creating NFT-backed sneakers and apparel that only exist in the digital world. After all, people spend hundreds of dollars on expensive sneakers in the real world simply because they are limited edition, so why should they behave any differently in the virtual world?
Finally, and perhaps most exciting from a technologist’s point of view, web3 offers the possibility that the very foundations on which digital worlds are built are built on decentralized platforms. Decentraland, for example, is an entire world built on the Ethereum blockchain. This means that users can use the virtual currency Ether to buy parcels that belong intrinsically to them and not to a corporation that owns the servers where they are stored. Not only does this mean they could benefit as the land appreciates in value (as with real estate), but they can set rules about what can and cannot happen there. In decentralized virtual worlds, governance can be carried out through smart contracts rules embedded in the blockchain and designed to run autonomously and users can vote and exercise their democratic rights to influence how the universe works. Don’t like the laws of physics that prevent you from jumping across continents? Maybe you don’t think the terms and conditions adequately protect users against cyberbullying or hate speech? Just start a campaign and get people to vote for the changes you want. It’s a far cry from digital dictatorships, where corporations make the laws and we either like it or leave.
So, there we have it, that’s the basic overview of why web3 and the metaverse are fundamentally different concepts, but are also closely related in many ways. More importantly, both have the potential to help each other become more than they already are, and that’s why there’s so much excitement about the ways they can interact.