Web3

In News

• Recently, the Finance Minister was addressing the 75th Annual General Meeting of Indian Banks’ Association in Mumbai where she highlighted the use of Web3 and Artificial Intelligence (AI) technology in fraud detection and to generate early warning signs in an unforeseen event.

About Web3

• It is also called Web 3.0.
• It is a decentralised internet to be run on Blockchain technology.
  • Gavin Wood, the founder of Ethereum (a blockchain technology company) used the term Web3 first in 2014 and the past few years, many others have added to the idea of Web3. 
• It would be different from the versions in use, Web 1.0 and Web 2.0. 
• In web3, users will have ownership stakes in platforms and applications unlike now where tech giants control the platforms.

Benefits of Web3

• Web3 will deliver a “decentralized and fair internet where users control their own data”. 
• Web3 enables peer to peer (seller to buyer) transactions by eliminating the role of the intermediary.
  • Currently, if a seller has to make a business to the buyer, both the buyer and seller need to be registered on a “shop” or “platform” like Amazon or Ebay or any such e-commerce portal.
  • Platform authenticates that the buyer and seller are genuine parties for the transaction. 
  • Web3 tries to remove the role of the “platform”.
• The spirit of Web3 is Decentralized Autonomous Organization (DAO) which is that all the business rules and governing rules in any transaction are transparently available for anyone to see and software will be written conforming to these rules.  
  • With DAO, there is no need for a central authority to authenticate or validate. 

Present status of its development 

• Web3 is in its very initial days and there is no consensus if it will take off like Web 1.0 or Web 2.0 did.
• There is much scepticism from top tech brains in the industry and the academic community that Web3 does not solve the problems it purports to solve.
  • For example, Elon Musk and Jack Dorsey do not foresee a future for Web3. 

• From a technology perspective, Web3 will require deviation from the current architecture where there is a front-end, middle layer and back-end.
•  Web3’s architecture will need backend solutions for handling blockchain, persisting and indexing data in the blockchain, peer to peer communications and so forth. 
• Similarly, the middle layer, also called the business rules layer, will need to include handling blockchain-based backend. 
• It is not known yet if Web3 will become the dominant mode of handling the internet but the questions it raises are relevant.

Source: TH