I began discussing Web3 back in 2005 when it was generally considered to be the semantic web, predominantly concerned with data, frameworks and search. The definition has changed over the years, and now Web3 can be simply defined as decentralised networks and applications, built on blockchain technology that give the user true ownership and control over their data.

ChatGPT can tell you about the key features including decentralisation, security, interoperability and scalability. Ask it about DeFi, DAOs, NFTs and dApps and you’ll get a good idea of the overarching concepts and applications.

When I got into web production towards the end of the Web1 era in the late 90s, significant innovation was laying the foundation for Web2, the internet of interactive experiences and user generated content that we’ve known for decades. During this time we saw the rise of the big tech giants building the tools, services and platforms for us to run our businesses, create new markets, communicate, live stream, promote ourselves, and organise our lives. We sign-up, and often pay, for all the convenient applications, cloud storage, and entertainment to keep us connected and portable 24/7. We’ve become programmed to mindlessly scroll, post, follow, like, comment, and share, love is a tap away and hate is decided by an algorithm.

Every service we use, every app we download, and every transaction we make, is tracked and stored. We’ve come to accept that our privacy is compromised and all of our opinions, interactions, and preferences are captured by big tech, banks and governments. While the internet has changed the world for the better in many ways, it has also introduced a huge amount of surveillance and control, created complex social issues and ultimately, made a select few incredibly wealthy.

However, thanks to blockchain technology and ‘decentralisation first’ principles, Web3 applications promise to offer the privacy and personal data authority that many are now seeking. We are told by the experts that the current state of the industry is definitively Web3 but it's clear we are in a transformative period between Web2 and Web3. Often crypto and DeFi projects that are pitched as fully decentralised choose to use some centralised Web2 infrastructure. There are businesses like Databank.me that claim to be Web3 platforms yet store the data on corporate servers, while many Web3 payment systems are partnered with major financial institutions.

Jack Dorsey agrees that we’re not fully there yet and explains that his 'Web5' platform bridges the gap between Web2 and Web3, adding a ‘layer on top of Bitcoin that takes the best of Web2 (like ease of use and developer tools) and combines it with the best of Web3 (decentralization and ownership).’ The fact that there is a gap qualifies the conclusion that the Web3 vision has not yet been achieved. Kevin Werbach, author of The Blockchain and the New Architecture of Trust, also states that 'many so-called Web3 solutions are not as decentralised as they seem, while others have yet to show they are scalable, secure and accessible enough for the mass market’.

There are hundreds of new Web3 companies, complete with teams of developers, marketers, sales people and VPs, all launching projects every week. There's an abundance of investment capital being burned through by start-ups building NFT engines, crypto payment systems, wallets, smart contracts, exchanges, metaverse gaming, dApp platforms and DeFi applications. Many are impressive and promising, but just like the dot.com bubble, a time will come when new innovation might leave them behind. With all the hype and optics, investors need to be careful that they’re not being sold a fantasy or gimmick, and be smart enough to get out at the right time.

Millions in funding is also going to companies like Avalanche, who market themselves as ‘a decentralized, layer-1 blockchain platform that supports smart contracts and decentralized applications (dApps)'. They have raised 140M and enable a number of projects to be built on their blockchain. They claim to be the fastest, most secure and scalable, novel architecture that allows ‘for a universe of independent, but interconnected, blockchains that are all validated and kept secure by dynamic subsets of validators.’

There’s a lot of competition in the layer-1 blockchain space, with businesses such as Solana, Polkadot, Cardano and Fantom, all offering unparalleled speed, security, and reliability. But what does this mean to most people? To put it simply, these blockchain platforms and ecosystems are used to launch, store and market digital assets, accept crypto payments, and develop new social networks and digital IDs.

Digital agencies and marketers are now selling the Web3 dream to their clients who want to be seen as trailblazers and innovators in the space. They commit to using Web3 products and services to create more personalised customer experiences, develop new marketplaces and build communities in the metaverse, but what they might end up with is a stack of integrated services and plug-ins that all require payment and maintenance.

One of the many brands now launching a semi-Web3 initiative is Starbucks with it’s Odyssey rewards system. Users sign up to participate in games and activities to earn points and collectable NFTs which can unlock exclusive benefits. So while it’s just a typical loyalty programme, it’s been built using a range of Web3 technologies to enable an NFT marketplace, smart contracts and decentralised storage.

While the platform is still in Beta, it has enrolled 1.6M users and Starbucks believe it has the potential to revolutionise the way they interact with their customers. Only time will tell if the investment to build Odyssey will pay off, or whether the initial surge of users will fizzle out due to a lack of adoption and interest.

Another huge global brand developing a Web3 marketplace is Nike with their application .SWOOSH. Like Odyssey, .SWOOSH is built on the Polygon blockchain platform and Nike intends it to be the leading NFT platform for digital fashion and collectibles. Members of the community will be able to collect virtual creations, unlock exclusive offers, and have the opportunity to co-create virtual Nike products. As of now, .SWOOSH is still in development and has over 100k interested users on the waitlist.

The success of a project relies on a creative strategy with an understanding of Web3 technology, the current landscape, the market and the communities that will make or break it. At the moment buying an NFT or crypto and even creating a wallet is too much for a lot of people who can't see the point and think it's too hard. However wallets like Xverse and Magic Eden are making connecting to a marketplace, launchpad or exchange much easier. Applications will only become more intuitive and frictionless and we'll see more trading of collectable NFTs and coins as people begin to understand how they can benefit. 

Central Bank Digital Currencies (CBDCs) are being launched globally and as the adoption of these grow more demand will also be created for alternative, dentralised currencies. Trading in multiple digital assets will become more widely accepted as new applications are released that give businesses and consumers an easy and trustworthy experience. Brand NFTs and coins will soon be accepted as payment for goods and services, just like rewards points and loyalty cards have been for years. Ape Coin is currently accepted by Gucci and other premium brands are collaborating with Web3 projects that cross-over into real world products and events. 

This is a time of historical change where old structures are being replaced and exciting new concepts and systems are emerging. We are entering a digital and financial renaissance that can bring new wealth to those who seize the right opportunities. 

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