Web3 is the next iteration of the internet. But with endless headlines screaming about NFTs, crypto and decentralization, what do you really need to know about Web3? Let us tell you in this three-minute guide.
We all know that nothing is fun when someone is gatekeeping. So the next version of the internet may be decentralized — which means reducing dependency on the large tech companies like Google, Apple and Amazon — and having a wider power base. These companies collectively are called FAANG.
The FAANG companies...
Meanwhile, decentralization doesn’t require “permission” which means there aren’t central authorities deciding who gets to access certain services. Applications are built on blockchains and networks of peer-to-peer servers rather than controlled by the large internet companies.
So in theory, an internet for the people by the people. But will consumers want to play that big a part? The FAANG tech companies have grown because they are convenient and easy to use.
Okay, But Isn’t Crypto Involved Somewhere?
Yes, cryptocurrencies have become tied into Web3. The idea is that cryptocurrencies use the same decentralized approach as the next stage of the internet. Banks and governments shouldn’t control all monetary systems. Instead, the distributed networks can do so using the Blockchain as an unchangeable digital ledger.
Blockchain, Did You Say?
That’s right. If you aren’t going to have the big internet companies making the online world work then you’re going to need a way to make sure internet transactions and connections happen. That’s where Blockchain comes in.
Blockchain involves no actual blocks nor chains. But instead it is a system to make permanent records that cannot be altered, meaning the details of transactions or banking can be held and not altered.
Is Blockchain Also Behind NFTs?
NFTs are also digital items with some permanence. Non-fungible tokens are effectively digital tokens that are unique and can’t be replaced. You can imagine them like a digital trading card or a digital piece of art that can be embedded with various benefits.
If you want to go deeper then you can watch our AWExplains on NFTs, but NFTs can be used in multiple ways. They can be collectible like this Grimes video or this CryptoPunk image, which sold for $23.7m.
For those of us still attached to the physical world, the value of NFTs can be confusing as technically you can copy or download digital art. But the value lies in the NFTs authenticity and ownership. You can check out some of the world’s most expensive NFTs.
And that’s it! Now you know about decentralization, crypto, blockchain and NFTs. Web3 in just three minutes.