Web3 technology promises to change the way we live and interact online globally. It will revolutionize communication, business and personal finance with the potential to lift the world’s poorest people out of poverty along the way.
Web3 is far more than a new architecture. It deals with privacy and trust issues by design. This is an essential step as our world increasingly relies on digital interactions for commerce transactions and peer-to-peer communication.
The internet as we know it is old, tired and broken. We love platforms like YouTube, Amazon and Facebook, but there are so many issues with Web2 technology. Data privacy issues, excessive influence from the social media giants and a constant stream of localized laws have created barriers to entry for many accessing the modern internet. They also reinforce old problems of inclusion and keep monolithic institutions in charge with an even greater power imbalance.
Countries like the UAE have embraced Web3 by creating a regulatory environment suitable to its growth. At the Binance Blockchain Week 2024 conference in Dubai recently, Rachel Conlan, CMO of Binance, gave a talk explaining, “The UAE has rapidly emerged as a global hub for crypto, offering an ideal environment to foster growth in a region setting the standard in sustainable regulations and innovation. Conaln continued, “Events like BBW showcase how blockchain-based financial systems actively empower communities across the globe.”
It is time for a change.
What’s The Web 3 Impact?
Gavin Wood, co-founder of Ethereum, coined the term “Web3” back in 2014 as he envisioned a new decentralized internet build on the blockchain where a community run network controlled access rather than the current centralized model in which a handful of corporations preside over Web2 platforms.
Web3 tech is different because it democratizes the flow of information and resources. The very nature of the blockchain should promote social inclusion and help poorer countries around the world. It also gives the power to the users to own and fully control their own assets.
Decentralized Finance (DeFi) is one of the biggest changes we are starting to see now. DeFi platforms will give access to financial services to people around the world who could never have a bank account. These DeFi platforms offer services such as lending, borrowing, yield farming and trading without any intermediate financial institution.
The advantages are clear, and the financial services sector has invested heavily in Web3 tech, with decentralized finance exchanges already breaching the $10 billion a day mark at peak times with an increasing market size expected to reach $65.68 billion by 2032, according to Precedence Research.
“Web3 embodies a seismic shift towards a more inclusive and user-driven internet,” elucidates Sarah Garcia, a blockchain technology researcher at MIT. “By endowing users with ownership of their data and online identities, Web3 harbors the potential to forge a fairer and more fortified digital ecosystem.”
Suddenly the poorest people in the world, with just a smartphone at their disposal, can access the same financial tools as the rest of the world. Those surviving on cash and barter systems will be able to access loans, investment opportunities and savings tools.
Web3 Decentralizes Gig Work
The gig economy is a recent phenomenon, and the likes of Fiverr and Upwork have helped keep many freelancers gainfully employed for years. But even these Web2 platforms reinforce the wealth divide as they reject third world freelancers and impose fees and banking requirements that make the whole process impossible for third-world workers.
Web3 platforms will be fully decentralized, and there will be no need for Uber, Doordash, and more to take their cut. The freelancer and client will connect, a smart contract will be put in place, and the work can start.
This will open up the entire world for sometimes brilliant and yet excluded workers in developing nations who simply could not have competed in a Web2 world.
Web3 technology will also help global co-operatives of freelancers to work together in Decentralized Autonomous Organizations (DAOs). There, they can collaborate and work on multiple projects without the inherent risk of a foreigner simply not paying the bill. Again, trust, ownership, and identity are all baked into the blockchain so that individuals can work together on ambitious projects without any kind of corporate structure.
This could change the face of tech, media and the creative world, bringing workers from new countries together and driving the industries forward with fairer compensation and fewer restrictions.
Even Non-Fungible Tokens could play a major part in the future of Web3. Artists, content creators, and musicians can monetize their work without relying on a music label, a platform like Youtube, or a gallery, which often takes a huge cut of their profits. They will also provide a payment mechanism so that artists in deepest Africa can sell work to downtown New York without needing to find an agent or representation.
Asset Ownership Through Web3 Tokenization
For the majority of the world’s population the idea of owning assets like real estate isn’t a reality. Enter tokenization. Tokenization involves converting ownership of a real-world asset like real estate or art into a digital token.
“One of the big innovations of Web3 are tokens — both fungible and non-fungible assets that are inherently unique — and the ability to program them with smart contracts that track them,” said Avivah Litan, vice president and distinguished analyst at Gartner.
While Web3 allow the world’s financially underrepresented population to own assets, most of these physical assets still require centralized legal and regulatory bodies to resolve disputes and transfer ownership.
Potential Problems With Web3
Web3 technology is obviously the way forward, but there are problems and obstacles that we need to address. Cryptocurrency is volatile, and that could have devastating effects on the poor if they lose money during a financial transaction. So, there is the potential for these good intentions to go horribly wrong. Stablecoins are one answer to that particular problem.
Of course, the other big issue is regulation. Web3 technology can regulate itself, but national governments don’t always see it that way and may impose their own rules. That could really hamper progress and keep this tech from the people who need it most. So, the industry needs to protect itself from outside interference, and it’s unclear how that will happen.
The energy blockchain networks need could also turn into major issues. Proof-of-work systems like Bitcoin need massive amounts of power. A recent study showed that 2% of the energy consumption in the United States went to cryptocurrency mining in 2024. This is an environmental issue, as well as a financial problem, and the industry must find a way to address this if Web3 technology is going to work on a global scale without switching our lights off in the process.
Web3 can give us new work models, create new markets and help lift the financially excluded out of poverty. This is a new digital revolution, and it is going to change the world for the better.
Published by Zeest Media
