Recently, Chairman of the Internet of Blockchains Foundation Matteo Gianpietro wrote an important article for Medium explaining why Blockchain is the Web 3.0.
First, he describes where it all began, Web 1.0: an era of dial-up internet, AOL chat rooms, and MSN messenger, in which everything was “maddeningly slow” and the web was just a bunch of static websites with no interactive content.
Then came along Web 2.0: With an emphasis on participation rather than observation, the second wave of the internet brought social media and the massive expansion of ecommerce marketplaces. The UN estimated that that internet users increased from 738 million to 3.2 billion from 2000-2015, and this astronomical growth also led to a massive increase in personal data floating around in centralized servers.
Web 3.0, or the creation of blockchain technology and decentralized applications, was born out of the revolutionary desire to take the power, and the data, out of the hands of huge behemoths and back into the hands of rightful owners. The necessity for the Web 3.0 arose around the time of the 2008 financial crisis. Just as people grew to realize that they didn’t want to rely on third-[party verification (such as a bank) to verify their financial transactions, they also didn’t want to hand over all of their personal information to large organizations.
The implementation of the Web 3.0 has already yielded many benefits, including increased privacy and security, reduced downtime, and streamlined business transactions thanks to smart contracts. Let’s take a closer look.
Increased Privacy and Security
With blockchain technology, transactions are added to a distributed data ledger, and verified across a peer-to-peer network, eliminating the need for third-party verification as well as storing data on centralized servers, where it is more vulnerable to hacking.
With the legacy Bitcoin blockchain, each transaction is given a public wallet address, so transactions are not completely anonymous.
However, recent advancements in technology have made completely anonymous transactions possible. A breakthrough in the field of cryptography, zero-knowledge proofs are a protocol that allow one user to prove to another user that he/she knows something, without conveying any information apart from that, and then the individual or computer subsequently validating the proof. With this cutting-edge protocol, transactions have reached an unprecedented level of privacy and security.
According to the 2015 iHS Markit study, North American companies lose up to $700 billion a year related to IT outages. Centralized servers can stop working for a variety of reasons, but regardless of the underlying cause, downtime is very damaging to companies and directly correlates to a loss of revenue. Fortunately, the blockchain is decentralized and supported by a peer-to-peer network, so if any one network shuts down, it will not impact the overall functionality.
Streamlined Business Transactions
Ethereum’s platform supports decentralized applications as well as smart contracts. Smart contracts, which are a computer protocol that directly controls the transfer of digital currencies and assets under certain conditions, have already demonstrated their utility in improving the accuracy, speed, and transparency of business transactions in fields in a variety of fields, including legal services, healthcare, and real estate.
According to a recent Deloitte survey, 34 percent of business executives said that their company already had some blockchain system in production, while another 41 percent say they expect their organization to deploy a blockchain application within 12 months. So while blockchain technology still has a ways to go before it’s completely integrated into the mainstream enterprise landscape, all signs indicate that’s where it’s heading.