Overview of WEB 3.0

In the past few months, web3, NFTs, Metaverse, Dapps … have been trending in the tech industry. But what are really these words about? What do they mean? Why is everyone excited about that web3 ecosystem?

Let’s talk about that in details.

I know you might be wondering, if we have web3 that means we had other versions of the web like web 2.5 maybe hahaha. And yeah you are right, the web has gone through some major improvements since it first appeared. The web as we know it today is at its second version or web 2.0.

So let’s talk about that for a second.

web 1.0

The first phase of the web (1.0) was read-only. This means that all you could do is to visit a website and see the content only, just like reading a magazine but using a device (computer). But since technology is always improving, we entered another phase of the internet.

web 2.0

The second phase of the web (2.0) is read-write. This means you can now read, write, update, and delete information on the internet. This phase of the internet quickly brought some new and cool innovations like social medias, e-commerce, … Again, because technology is always evolving, people started to dislike the fact that their data was misused by companies that are keeping user’s data in their databases. Also the fact that if a company’s server goes down or resources are lost by the company, a whole application and its users (sometimes millions of users) suffer from that. The fact that all data is controlled by a single entity or company, which is called “centralization” becomes a problem in the ecosystem.

web 3.0

Let’s now talk about the third phase, aka web3.0. Web3.0 is the third iteration of the web and it brings innovation like decentralization, truth over trust, ownership, clarity and anonymity. We’ll talk about all these aspects through this article.

But one question, ‘what makes web3.0 special? ` The blockchain technology. The blockchain is considered as a public database where everyone has read and write access. This database is decentralized and distributed across many nodes (computers) around the world. If we split the word blockchain in two other words, we get block and chain. This means transactions are being gathered and stored in blocks which are chained together one after another. Each transaction contains a hash of the previous transaction. Since the blockchain is distributed across many nodes, there has to be an agreement (consensus) on how to store data and keep it verifiable on different nodes. The blockchain technology uses two major ways of reaching consensus among nodes. We have proof of work (PoW) and proof of stake (PoS). Let’s go through each one of them and see how they work.

1. Proof of work (PoW)

This mechanism is older than the proof of stake (PoS) and it was first used by bitcoin. In this mechanism, miners (computers) around the world race to solve an algorithm. The first miner to solve it gets rewarded (crypto). The winner gets to update the blockchain with the latest transaction block. One of the odds of this mechanism is that it is energy-consuming and can have scaling issues to accommodate the vast number of transactions for Ethereum and EVM (Ethereum virtual machine) compatible blockchains. That is why alternatives like proof of stake (PoS) have been developed.

2. Proof of Stake (PoS)

In this mechanism, a participant of the network gets selected to add the latest block of transaction to the blockchain and gets rewarded (crypto). In simple words, validators stake their crypto for a chance of being the validator of the block, updating the blockchain and finally earn a reward. This protocol is not energy-consuming like the PoW because here miners don’t have to solve the same puzzle.

Next, let’s talk about smart contracts.

A smart contract is a piece of code (generally not too long) that lives on the blockchain and executes whenever called. These smart contracts, once deployed on the blockchain (mainnet), they live there forever. So, make sure your code is tested and working well before deploying. How are those smart contracts developed? If you are developing for Ethereum or EVM compatible blockchains, the main programming language for writing smart contracts is solidity followed by Vyper. But other blockchains like Solana use programming languages like Rust instead. Below, we have an example of a smart contract written in solidity.

Tokenization

On the blockchain, the concept of tokenization is very common. By tokenization, I mean assets are represented on the blockchain in form of tokens. We have two major groups (types) of tokens: fungible tokens and non-fungible tokens. Let’s go through each type.

--Fungible tokens

This token standard is widely used in defi (Decentralized finance). Let’s take an example on ethereum where we have ERC-20 tokens. These tokens are exchangeable one another. This means that I can trade my ETH and buy MATIC with no risk or incompatibility.

--Non-fungible tokens

On the other hand, we have non-fungible tokens. As the name indicates these are “NON” fungible which means that one token is not equal to another. One NFT can never be interchanged by another NFT. Each NFT is unique and non-interchangeable. NFTs are used widely for ownership verification. One of its use-cases is digital art which has gained popularity lately. We’re seeing platforms like opeansea where people buy and sell digital arts for millions of dollars. But as I said, this is just one use-case, we’ll see more use-cases of NFTs in the coming years (spoiler alert… METAVERSE).

DAPPs

Let’s actually talk about this term that sounds cool. Basically, a dapp means decentralized application. This term is used to talk about applications that use the blockchain. These applications use a wallet to sign in to the blockchain and pay all the fees related. One of the popular wallets used is called metamask. How do dapps (frontend) talk or interact with the smart contracts that live on the blockchain. ? In most cases, the frontend of a dapp is a web interface and it communicates with the smart contract using an API like web3.js, web3.py, ethers.js… These allow the frontend to read from the smart contract and write (send transaction) to the blockchain. Because the concept of decentralization excites most people (developers), we’re seeing a lot of dapps emerging in the space.

Well, web3.0 is revolutionary!

If you’ve made it to this point, I hope you get an overview of the web3.0 ecosystem and why this will be the future of internet. In case there is any concept that has not been well explained or has been forgotten, just reach out to me on twitter ( @KimMerdi ) and we’ll talk about it. You can also find this article in video format here
That’s it … Thank you!

Wagmi