Recently, a16z, the leading Blockchian VC, released “Introducing the 2022 State of Crypto Report”, which describes the importance of Web3 in detail, and how it has changed the status of users by giving users part of the ownership of the Internet. At the same time, it also represents that the potential of Web3 has just begun, and there is still huge room for growth in the future.
Leading venture investors such as Sequoia, SoftBank, Temasek and Coinbase Ventures stepped up their deployment of Web3 track. The rise of Web3 has triggered debates in many institutions. Musk, who appears as the spokesperson of the Silicon Valley encryption field, said on social media that Web3 is only an over-packaged marketing term at present. Jack Dorsey, founder of twitter, a strong supporter of blockchain technology, is also angry that Web3 is controlled by venture capital institutions currently.
Ray Dalio, one of the most famous hedge fund managers of our time, proposed the concept of “paradigm shift“ in 2020, and he revisited it at the beginning of 2022.
“The world order is changing in important ways that have happened many times before in history, though not in our lifetimes. How the world order is changing has created the paradigm that people are in. by”paradigm,” I mean the environment that people are in. Paradigms typically last about 10 years, with occasional big corrections within them. They are driven by a persistent set of conditions that takes those conditions in a swing from one extreme to an opposite extreme. ”
Dalio is adept in studying the impact of past changes on the contemporary economic environment from the historical perspective of global macro political and economic development, which is one of the secrets why he becomes an excellent hedge fund manager. The paradigm shift proposed by him is also applicable to the still young Internet industry. When people are immersed in the infinite vision of the next-generation Internet, people also need to seriously consider whether this Web3 is a brand new “paradigm”.
The logic behind the popularity of Web3
Web3 is discussed as much as last year’s big hit topic “metaverse” in terms of popularity since you’d hear people talk about it at any crypto gathering. It is with web3 that the history of the Internet has been defined as web1 and web2. The Internet has evolved from only “readable” at first to “read+write” of web2 and finally to “read+write+own” or “earn” of Web3.
The popularity of Web3 is due to the improvement of valuation brought by the development of the blockchain industry, but it is still a competition for ventures in essence.
The increase in the yield of early venture capital has driven more traditional institutions into Web3, including many private equity funds, hedge funds and even pension plans. The total amount of global venture capital in 2021 exceeded $550 billion, 50% higher than that in 2020.
The influx of funds naturally leads to the improvement of the valuation of those start-ups, which will promote the investment of the fund to continue to advance and constantly look for early venture capital projects in the industry. It is inevitable that the blockchain industry and Web3 concept both burst out.
The needs behind Web3
The outbreak of Web3 has a very clear external driving force, but similarly, the demand behind it is also quite obvious.
In an era like this where lots of meaningless competition is going on more people are eager to see a change in way of cooperation, or,a change in way of thinking.
In the web2 era, the centralized organization platform is the absolute core and the master of profit distribution; however, from the perspective of Web3, every business activity can be divided into creators, developers and users. Anyone involved in this business division can have a finger in the pie and become the beneficiaries of business activities.
For large centralized organizations, Web3 is a change in the way of thinking. In the Web3 era, the boundaries of traditional enterprises are slowly fading, Users are becoming more fluid. It will be an important challenge to seek a free and open self-organized structure for every large centralized enterprise the new era. From this perspective, Web3 can indeed be called a real paradigm shift.
The migration to Web3
In the era of web1 and web2, the emergence of large-scale centralized organizational structure enriches and facilitates people’s lives on the one hand. However, when people begin to rely more and more on the services of these large institutions, the disadvantages of centralized organizational structure in data privacy and user personalized services are gradually revealed. The emergence of Web3 is just to use the decentralized mechanism to solve the problems under the centralized organization.
If anyone else can represent the most forward-looking vision of this era, it is undoubtedly the investors in the financial industry.While Web3 may still not be able to escape the realm of pioneering concepts on many levels, that still doesn’t stop the head funds from going crazy about this emerging industry.
A16z is a typical representation. As a star venture capitalist that invested in American tech giants such as Facebook, Groupon, Skype and Twitter in the early stages, it began to put the layout on Web3 in 2019 or even earlier. Now a16z openly declares it’s all in crypto. Looking at the investment portfolio of its encryption industry, its determination to layout Web3 track is evident.
With the favor of well known ventures, the Web3 industry is growing savagely at an unprecedented speed. What people see is the gradual migration of web2 ecology to Web3.
The so-called ecological migration refers to the influx of a large number of industry veterans from traditional web2 companies to start the pioneering work of Web3 era.
Decentralized PayPal: MetaMask(Unissued)
Decentralized KEEP: STEPN(GMT)
Decentralized Spotify: Audius(AUDIO)
Decentralized GMAIL: Dmail Network(Unissued)
Decentralized domain name service: ENS (ENS)
Decentralized content platform: Mirror(Mirror)
Decentralized Reddit: Steemit(Steem)
Decentralized e-commerce: Opensea(Unissued)
Decentralized Youtube: Glass(Unissued)
Decentralized game platform: Decentraland(MANA)
Decentralized cloud storage service: Filecoin(FIL)
Decentralized Whatsapp: Status(SNT)
Encrypted Sneaker Store: RTFKT(Unissued)
Decentralized social graph: CyberConnect(Unissued)
Decentralized Twitter: Bitclout(Bitclout)
Decentralized Tiktok: Cancan(Unissued)
From Web3 payment, sports and music to email, domain name and e-commerce, various applications of Web3 are still developing, and this list continues…
These names give a clue that among the DApps currently constructing the Web3 world, the ones that are getting the most attention to begin with are the ones that can construct the infrastructure. MetaMask solves the payment channel for web3, ENS. Filecoin and Mirror help people build the channel for identity, storage and content creation. Therefore, these names are also known to people in the crypto industry, and when people are looking for the next application that might be world-known, people should never overlook the one with comprehensive functionality – Mailbox.
Mailbox is the most fundamental component on the Internet. people need it every day from the perspective of communication (daily or commercial) or identity authentication. In the world of Web3, such a role is inevitably indispensable. Dmail, which focuses on Web3 email, has appeared in the list above.
Judging from the test network function it has just launched, Dmail has realized the communication function between Web3 mailbox and traditional mailboxes. One of the main features of this project is the privacy protection of user information and decentralized storage of information. In addition, it has an embedded wallet and can send encrypted assets via email. In terms of user login mode, users can log in either through the traditional email name or by binding a wallet, which helps web2 users enter the world of Web3 much faster. Besides, e-mail，which has the role of Internet identity in the web2 era,naturally has the function of decentralized identity (DID)in the Web3 world.It can be said that Dmail is an application that integrates multiple functions such as payment, DID, communications and decentralized storage.Maybe one day it may really become an application that people can’t live without, like Gmail.
One of the major challenges for Web3 development is how to increase user traffic. Traditional web2 users often lack confidence in web3 applications because of their user habits or lack of knowledge of the product. However, mailbox has application scenarios that run through from web2 to Web3 era. The emergence of Dmail may encourage traditional users to make new attempts, thus bringing new traffic to the whole Web3 world.
Of course, the assumptions above all are based on the current situation. In the end, people will wait and see which product can run through web2 and Web3.
What problem is Web3 solving？
Finally, what fundamental problems can Web3 solve to attract the tech veterans and IT newcomers to migrate from web2 to Web3?
In short, privacy protection and data storage. Although this is a cliché, it is the basis for people to completely enter the Web3 world.
About privacy
One of the problems centralized organizations get criticized by the most in the web2 era is that users’ information, even privacy is often leaked. Whether Facebook, Twitter or Yahoo, there have been very serious user information disclosure incidents. Web3 applications will realize the peer-to-peer connection between users through on-chain technology, which will reduce the risk of the centralized organization leaking users’ privacy.
For example, in the list of Web3 applications in the previous section, Dmail, which aims to become the Gmail of Web3 world provides such a service. It sets three levels of encryption for users to fit different scenarios When users adopt normal levels, the protection strength of canisters on the Dfinity chain determines the security of the mailbox. When users use encryption methods above intermediate level, they must use their own private key to decrypt the encrypted content in the email, so as to ensure that the email content will not be stolen or accessed by a third party.
About decentralized storage
Today, even in the encrypted world,most applications still use centralized cloud storage. But when it comes to ownership, we actually don’t really own it. In the Web3 era, however， users’ data will be distributed and stored in any corner of the Internet world. Decentralized storage is the only way to achieve true ownership of data by anyone and to retain information forever. In the above list of Web3 applications, Filecoin itself is a star project of decentralized storage. For example, Audius, Dmail, Mirror, Glass, etc. all save their users’ information through decentralized storage. On the one hand, these ensure the security of users’ information, and on the other hand, users’ information will be permanently saved on the chain without being affected by any third-party organization.
Conclusion
Many people think that the current Web3 is like the tech industry in the 2000s; while also many people think that people who do not believe in Web3 may miss investment opportunities in the next 10 years. A lot of new concepts of the new era may only float in the air in the end How do you know what will stay despite the pass of time? The most important thing people can dois to keep learning and keep thinking, at the same time people can progress with the times.
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