What is Web3? Why Are Elon Musk and Jack Dorsey Scared of It?

We've seen concepts like decentralized finance (DeFi) and non-fungible tokens (NFTs) take the world by storm. As 2021 winds to a close, many in the crypto market wonder what trends will be prevalent next year.

What is Web3? Why Are Elon Musk and Jack Dorsey Scared of It?

Much talk among tech moguls and CEOs surrounds Web3. Block's chief exec Jack Dorsey and Tesla CEO Elon Musk recently weighed in, and their opinions weren't necessarily flattering.

So, what opportunities does Web3 offer? And why are some so skeptical?

An Introduction to Web3

Web3 is seen by many as the next evolution of the internet.

For example, Web1 is essentially the start of the internet age. With Web1, people could own websites and display their hobbies, passions, businesses, etc.

But Web 1 was limited. All these websites could really do was display pages for visitors. Webpages could barely display images, and visitor interaction was low.

The 21st century introduced Web2 - a new internet evolution with greater capabilities. Web2 offered interactive web pages and online services. Advances brought email scheduling, social media, blogs, and more. With webpages able to handle higher loads, video and image content was encouraged.

Roughly two decades since the introduction of Web2, the world is now talking about Web3. While there are many iterations of this concept, one primary rule maintains - Web3 will bring about greater data interconnection and decentralization.

Decentralization means the internet will move away from single location data storage. Decentralizing data from large companies like Apple, Meta, Twitter, and Amazon should decrease hacking, identity theft, and other vices.

As you would expect, blockchain technology underpins this shift towards decentralization. Blockchain already enables the function of cryptocurrencies, but can be applied to just about any other field.

The idea is for people to still be able to conduct their activities on the internet - social media, shopping, content consumption. But, Web3 will introduce greater data privacy and allow you to control what happens with your data.

What Will Power Web3?

As many experts believe, Web3 will rest on four pillars:

  • Data Ubiquity: Makes the internet available to everyone at any time. Thanks to the Internet of Things (IoT), internet-connected devices will no longer be concentrated on specific devices.
  • Semantic Web: By infusing semantics into the internet, services can better decode the meanings of specific data. This enhanced data connectivity will allow internet users to enjoy better experiences.
  • Artificial Intelligence: AI is already here. However, it is expected to become even better with Web3. Integrating AI into a platform will help filter experiences and tailor them to specific users.
  • Spatial Web and 3D Graphics: By revolutionizing graphics, Web3 is expected to remove - or, at the very least, reduce - the barriers between the physical and digital worlds.

With these pillars in place, humanity will enter into a new relationship with the internet - one where everyone controls their data, and online services work to deliver the best possible experience to anyone who logs on to their domains.

Criticisms About the Future of Web3

The arrival of Web3 is exciting for many people. However, some tech billionaires aren't without concerns.

Recently, Elon Musk shared a TikTok video showing an interview between David Letterman and Bill Gates back in 1995. Gates is seen saying in the video:

"I'm not suggesting Web3 is real — seems more like a marketing buzzword than reality right now — just wondering what the future will be like in 10, 20, or 30 years. 2051 sounds crazy futuristic!"

Musk followed up with a simple request to find Web3, adding that he can't seem to see it.

Jacob Dorsey, the former Twitter chief executive and current CEO of payments service Block, suggested big venture capitalist firms are part of the problem in a tweet.

Dorsey hinted that famed venture capitalist firm Andreessen Horowitz already controls Web3.

Andreessen Horowitz is an early backer of companies like Facebook, GitHub, Asana, and so many more. The company is the poster child for venture capitalists and everything people criticize about them.

Musk's criticism seems to stem from the fact that most people who use Web3 as a concept just want to profit from it. There have been cases where companies use concepts like blockchain and artificial; intelligence to woo investors and make money without actually using these concepts in their operations.

As for Dorsey, he believes companies working on Web3 technology will eventually turn into for-profit organizations and leave the concept behind due to pressure from investors.

Both criticisms are valid. Only time will tell if, and how, Web3 will change our virtual world.

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