You’ve probably noticed the hype around Web3, the next phase of the internet that aims to focus on openness, decentralization, and better user utility. Big companies like the OpenSea NFT marketplace have utilized this upgraded phase of the internet.
But do startups also stand to benefit from Web3? If so, how can they benefit from it? Read on to find out.
What Is Web3 Technology?
Web 3.0 was initially called Semantic Web by the Wide World Web (www) inventor Tim Berners-Lee. This is the next upgraded generation of the internet, where data will be decentralized, unlike the current internet Web 2.0, where data is stored in centralized storage systems.
With this version of the internet, websites and apps will operate in a more human-like way through technologies like Artificial Intelligence (AI), machine learning (ML), decentralized ledger technology, and so on.
How Does Web 3.0 Work?
The main difference between Web 3.0 and its predecessors (Web 2.0 and 1.0) is how it connects to data sources and where they reside.
Most websites and apps in Web 2.0 rely on centralized data sources to deliver information and function perfectly. However, with Web3, applications and websites use decentralized data sources, making the internet more open and inclusive.
Many features define this version of the internet. Some of them include:
- Decentralization: As mentioned earlier, Web3 mainly relies on decentralization, where centralized entities don’t control websites and apps.
- Artificial Intelligence (AI): Web 3.0 incorporates Artificial Intelligence more to single out fraudulent data.
- Blockchain: Blockchain technology is considered the foundation of Web 3.0, which enables it to be more open and decentralized.
Other features include edge computing, semantic web technology, 3D graphics, and more.
Web3 And Startups
Web3 presents many opportunities for startups to improve their business operations and grow their businesses. Here’s how this next generation of the internet can positively impact startups.
It Simplifies Many Business Procedures
Since Web3 mainly operates on a blockchain, it can simplify many startup procedures, thanks to decentralized technologies like smart contracts. Typically, when a smart contract is drafted, it is converted into code and stored on a blockchain.
The contract is automatically executed when all the terms and conditions stated in it are met by both parties involved. This eliminates the need for third parties like lawyers, enabling startups to save time and money.
Enhances Digital Marketing Strategies
Web3 will change the way startups market their brands. For starters, it enables business owners to access real-time analytics that allow them to make more informed decisions on whether or not their marketing campaigns are working much quicker.
This phase of the internet also features advanced search engines that enable the understanding of every web page uniquely. Startups may then ensure that the right target audiences see their websites.
Enhances Data Security
Online security continues to be a concern as the internet evolves. So, websites implement different safety protocols to ensure their audience’s confidential data is safe from hackers.
Web 3.0 is decentralized, making it more secure than Web 2.0 and 1.0. This is because a network of storage systems, not a central computer, stores data on Web 3.0.
So, even if malicious users hack one storage source, the others will remain intact, making it challenging for hackers to access complete data. This is a breath of fresh air for startups as they can be confident that their client’s information is safe on their websites.
Startups Utilizing Web3
Here are some startups that have incorporated Web3 into their businesses.
Polygon(MATIC)
Polygon is a cryptocurrency and a technology platform that works to enable blockchain networks to connect. It operates using the Ethereum blockchain and connects Ethereum-based projects.
Polygon platform increases scalability, sovereignty, and the flexibility of blockchain projects while still being able to afford the structural benefits and security of the Ethereum blockchain.
Recently, Polygon announced that it was partnering with Nothing, the inventor of Phone(1), to integrate Polygon into Nothing’s first smartphone, giving it access to Web3 functionality.
Terra
Despite the controversy concerning the collapse of their cryptocurrency, Terra is an open-source blockchain payment platform and protocol used for algorithmic stablecoins. An algorithmic stablecoin is a cryptocurrency that tracks the price of other currencies and assets. So, TERRA allows users to exchange, save, and spend algorithmic stablecoins.
The platform recently announced that it was partnering with Near Protocol to promote the change for Web3 through different collaborations and deeper integrations.
Decenternet
This Hong Kong-based startup offers a Web3 browser. It utilizes blockchain technology to provide an efficient and seamless user experience. Decenternet’s core mission is to create a decentralized, hyper-speed, net-neutral, and value-driven digital network.
Its browser offers a much quicker browsing speed, does away with intrusive ads, and does not track the user’s browsing activities across the web.
Disadvantages of Semantic Web (Web 3.0)
While Web3 has many advantages, it has its fair share of downsides.
Less Advanced Devices Will Most Likely Not Benefit From Web3
As we mentioned earlier, Web3 utilizes several technologies like Artificial Intelligence (AI) and Machine Learning (ML), to name a few. Less advanced devices may not support these technologies, making it challenging for them to benefit from Web3.
Web3 Has a Complex Functionality
As you may have noticed, Web3 has quite a complicated functionality. It has many ins and outs, and startups must figure out to utilize it to its full potential. With the many things to learn about Web3, some startup owners may be hesitant to use it.
There’s Still A Lot of Work to Be Done On Web3
Web3 still has a lot of work to be done on it to make it fully functional across the globe. This includes privacy laws and technological advancements, to mention a few.
Conclusion
So, is Web3 the future for startups? Absolutely. Web3 offers startups opportunities to simplify business procedures, reduce costs in various business areas, and create better client experiences.
However, it’s advisable for startup owners to carefully study this new version of the internet, from how it works, its strengths, and its weaknesses. Doing so will help them make a more informed decision on whether they should dip their toes into this new phase of the internet.