We live in a world where the lives of the common man are heavily influenced by the Internet.
Imagine waking up at 6 am in the morning and your Mobile notifications pop up the daily weather report since you always check it to plan your day accordingly.
As you step out of the house your Uber app might already know it’s office time and may pop up some good deals for a quick ride to the office. As you approach lunch hour, your food apps might have read your heart and flooded your notifications feed with exciting offers. You might be scrolling through social media and you see ads for products that you have previously searched about, or that you are interested in.
This happens because the Internet of today collects data about our activities and is collected by companies through their apps. This constant interaction between the User and the Web is what we call Web 3.0, but we’ll talk about more of this later.
Background of the Web
The evolution of the Web can be classified into 3 Stages:
- Web 1.0
- Web 2.0
- Web 3.0
Web 1.0 (1991 – 2002)
To simplify, Web 1.0 is a Read-only version of the Internet. It basically consists of a bunch of Websites with some information. Users only search the web to find and consume information. That is why in Web 1.0, the users were also called Consumers.
There wasn’t any logging in, Posting Content on any platform, or viewing analytics. The early web was not even profitable for advertisers.
Another way to look at Web 1.0 is a one big Wikipedia with each page hyperlinked together.
Web 2.0 (2004 onwards)
From 2004 onwards, the internet had evolved a lot, but perhaps one of the biggest changes was the interactivity of the Internet (I would use words like Internet and Web interchangeably).
This means that not only just Users consume data from the Web, but the Web also receives data about us.
Whenever the users are surfing through the net, centralised companies who control most of the Web like Google, Youtube and Facebook, collect our activity data and use it to show us content that will enable us to spend more time on their platforms.
This makes them money. But they soon realised that they can sell this data to advertisers who can use it to optimise their advertising strategy, thus making them more money.
In a Summary,
Web 2.0 is the Age of targeted advertising and the lack of Privacy!
However, to be fair, we do willingly give up this information, as people really don’t care, as long as they are getting information and content to their liking and interest.
So in Web 2.0, the You and Me browsing Facebook.com would see very different feeds, because Facebook uses our activity data i.e, Likes, Video views, shares and other forms of engagement to scoop up content according to our liking.
But if you look at the Ads they show you, then the data utilised behind it comes from data you didn’t know you shared.
For example, if you went to eat burgers at an Eatery, or you drop off your children at school every day of the week except Friday, the Web may know it. The Machine Learning algorithms of these platforms can extrapolate this information based on your activities on the web at any specific time.
There was even this one article which claims that a person was served some parenting ads since the Machine Learning algorithm already knew he was going to become a parent even before he knew himself!
Even if it is not machine learning, it was probably because his girlfriend might have made a search on the web on how to detect the symptoms, from which the AI made conclusions that she might be ovulating.
Whatever may be the case, allowing big corporations to have control of all these user data is definitely scary and a cause of concern.
Introducing Web 3.0
Web 3.0 is the next evolution of the Web, probably using Blockchain Technology and the tools of decentralisation.
But before diving into that, let’s talk about what a Blockchain is.
Blockchain and how does it work
Blockchain is a technique to control data in a decentralised manner. What that essentially means is that there is no centralised hub or server; instead data is stored in thousands of computers or nodes connected to a network called the Blockchain network.
Essentially the fundamental element of a Blockchain network is a block which contains the following things.
- Hash of the previous blog.
Let us understand each of these:
Hash of Previous Block
This makes the block interlinked with each other.
So here’s an example of what a Block Chain looks like:
This also serves gives additional security since the data cannot be tampered with as changing one data point changes the hash of the current and previous block eventually leading to a chain of changes that would ultimately destroy the Blockchain.
So one a data block is added to the Blockchain, it technically cannot be tampered with.
Some Points about BlockChain
- The entire blockchain resides as a copy in a network of computers or nodes making them decentralised. Some of these nodes are also miners.
- These nodes, verify the data each time it is added to the Blockchain.
What about Privacy?
Since all data resides in a network of computers or nodes, one might wonder how is data kept secure, in other words, What about Privacy?
Privacy is achieved by the use of public-key cryptography. Every node contains its individual private and public keys, Just like an email address and its password.
So any transaction or activity done by the user on the blockchain is accessed by the nodes using the public key of the user. Hence only the action is registered, not the identity of the user which is stored in the private key.
How does Data get Processed in a BlockChain?
Any activity on the Blockchain network is considered a transaction. Let’s say A is sending an amount of Rs 50 to B in the network.
This transaction is carried out only when the majority of the nodes in the network verify the transaction.
In case a particular node gives a false signal, in that case, the transaction is carried out by the simple majority of the consensus of all the responses received from all the nodes.
This exposes a weakness in the blockchain, since if somehow 51% of all the nodes in a Blockchain network are hacked then a particular transaction can be stopped or altered.
This so-called “weakness” is also a strong factor since, provided there are sufficient nodes in a large enough blockchain in different locations, it is impossible to hack 51% of all the nodes at the same time. Hence only a mass hacking event can only defraud a blockchain, although that is extremely difficult and almost impossible to carry out.
Back to Web 3.0
Now that you have received a fairly good idea about a Blockchain and a decentralised network, we can continue with Web 3.0.
In Web 2.0, you the user were the Product, since you are consuming content produced by the Web and the centralised owners of the Web earn money from that.
In Web 3.0 many believe you will be the owner of your Web content. This is kind of true. So if you want to post stuff online, that is still fine, but if your stuff is to be taken down, then you kinda can control that.
Here’s a real-world example of how this work.
In a platform called Odyssey, users get to watch videos and earn library tokens which are used as currency to perform a variety of tasks on the platform. If someone wants to share a video, they technically need to download the video content and let others watch it. Kind of like a torrent for social media.
Odyssey can’t stop a video as it is in thousands of servers in the world that are controlling the blockchain social network.
This actually poses a threat as this may lead to many hateful things being posted on the network. To take down a video a consensus would have to reach among all these nodes to take the video down.
Less Power to Corporates, Rise Of DAOs
In Web 3.0, experts speculate we will reach a state of the internet where institutions, shops and businesses will be administered by groups called Decentralised Autonomous Organisations or DAOs.
These are basically people or nodes in the network with the most tokens or Network Currency. For example, the token for the bitcoin network is bitcoin itself.
This however means that there will be No CEOs or Presidents to impress, instead decisions would be made purely on consensus.
Important Features of Web 3.0
- In Web 3.0 there will be no censorship like on Facebook and Twitter. No central authority can take or even influence major decisions. Changes will be made only through voting.
- Also, your Digital Identity is not 100% connected to your Real-world identity. This means you can post pictures, make trades or sell anything completely anonymously.
- Lastly, you can own your own Web Content in the form of Tokens called Non-Fungible Tokens or NFTs. Here we will be elaborating on that concept.
What are NFTs? How do they Work
A Non-Fungible token or NFT is like a digital token or asset. A common analogy is to think of these as digital trading cards or digital paintings. Whenever you are buying an NFT you are buying the rights to that specific asset.
Non-Fungible means, it cannot be changed when it is created and it should be distinguishable and unique. Unlike a coin such as bitcoin, 1 bitcoin = another bitcoin.
But all NFTs are unique and are always different, and the token is a small piece of data that you own. Together, an NFT is a token that you own that doesn’t change throughout time.
Now we have had an overview of the nature of NFTs, let’s understand what is an NFT technically is.
Technical Aspect of NFT
NFTs are just a piece of data that is owned by an address. And whoever has the password to that address, owns that piece of data. That data can be bought and sold to different addresses and that data is verified in a blockchain and the cool thing is that the owner’s history can also be tracked in the network.
Let’s take this kitty example:
This kitty sells for $600,000.
So What happens when you buy NFTs?
Whenever you buy NFTs, you only own a piece of data that points to a server which hosts that image. However whoever owns that server can change the image, so mostly NFTs are hosted on blockchains which is owned by a collective of nodes.
That is why it is important to know what you are buying. As buying an NFT means owning only a piece of data that points to something on the internet. Owning an NFT doesn’t really give you anything.
Why buy an NFT?
The only reason right now people buy NFTs is that they can be sold as collectables in the investment category. Here are 4 reasons why people would buy an NFT:
- Being the First of its Kind
- Utility or Real-World Benefits
- Unique or Rare
- Ownership History
Being the First of its Kind
For example, Pokemon Cards have great value and the most expensive card is probably the first card. Similarly, the first NFT minted by someone or belongs to a popular category may be more valuable than they seem.
Utility or Real-World Benefits
Imagine the World Class Chef Gordon Ramsay, minting only 50 nfts in his lifetime. And if you own any of those nfts, you would get one free dinner at any Gordon Ramsay restaurant and 30% off henceforth.
This alone will instantly shoot the price of these NFTs. Hence the real-world benefits of an NFT can change its value.
Unique or Rare
Imagine Stephen Hawkings only ever minting three nfts. Those NFTs, even if they are a glimpse of space, would be really valuable, since they are rare.
If a particular NFT was owned by a popular person before, for example, Robert Downey Junior, then that alone might shoot up the price of that NFT.
Types of NFTs
- Domain Names
- Trading Cards
- Virtual Worlds.
How to Buy, Set Up and Sell and NFT?
In this example, we will talk about how to own and mint a domain name NFT and how to list it on NFT marketplaces like opensea.io.
Step 1: Buy a Domain
- Go to unstoppable Domains(https://unstoppabledomains.com/)
- Type a domain name and see if it’s available
- Create an account with email and connect your Crypto Wallet.
- Checkout with your Favourite Domain Name. You can pay through credit card, Crypto or Paypal.
Step 2: Mint your Domain
You can use the Free Mint option which uses Polygon Matic to mint your new domain. After minting your domain will be assigned to the particular wallet connected to Unstoppable Domain.
Step 3: Manage your Domain
- Finally, it’s time to manage your domain
There are 3 Ways in which you can design your website:
- Using a Template.
- Copy the Source Files of another Website.
- Link to an existing Domain.
Clearly, the easiest way to set up a Domain (if your goal is to sell it as an NFT) would be to use a template.
Here’s what we did for ThatWare.
How to List your Domains as an NFT on OpenSea?
Step 1: Open opensea.io and create an account by connecting your Wallet.
Step 2: Tap on create and give the necessary info to create your NFT.
Step 3: Minting the NFT on Ethereum will take some fees. So if you want to avoid that you can mint on Polygon.
Finally, your NFT is ready for Sale on the OpenSea platform.