What Is Web 3.0?

By Michael Flannelly · August 03, 2022 · 8 minute read

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What Is Web 3.0?

Web 3.0, sometimes called Web3 or Web 3, is an umbrella term for the next phase of the internet and world wide web. Web 3.0 is still in its early stages, and there is much debate about what it is. Some say that Web 3.0 is the next stage of the internet that may change society. Others say that Web 3.0 is simply a marketing term used to describe the latest trends in web development, such as the rise of social media, mobile applications, and cloud computing.

However, it’s not debatable to say that money is pouring into Web 3.0. Whatever Web 3.0 is, it’s becoming an important area for investments. As such, it’s wise to learn more about what Web 3.0 is and how you can invest in this space.

Web 3.0 Definition

Web 3.0 is the name for the next iteration of the web, where blockchain technology will allow users to interact with the web in a more secure and personal way. Rather than be run in a top-down, centralized way by large corporations, Web 3.0 will theoretically be decentralized and run on a bottom-up basis, with users as the focus.

Relatively new technologies, like cryptocurrencies and blockchain, make the vision of Web 3.0 possible. These new technologies also include the semantic web, an idea of the future internet where information is more easily accessible and understandable by computers because of artificial intelligence.

Nonetheless, everyone has a different definition of what Web 3.0 is and what it could be. Web 3.0 is still in its early stages, but proponents claim that it has the potential to change the way we use the internet.

💡 Looking for more Web 3.0 info? Check out our Web 3.0 guide for beginners.

History of the Web

The history of the web can be traced back to 1989 when Tim Berners-Lee created the World Wide Web (often shortened to “the web”) as a way for users to share information through the internet easily.

Web 1.0

Berners-Lee’s creation of the World Wide Web kicked off the first generation of the web, now known as Web 1.0. This early phase of the web, which existed in the 1990s and early 2000s, primarily focused on providing information to users through static web pages connected by hyperlinks.

Users of Web 1.0 were essentially consumers of content on these static web pages, often accessed through portals like America Online (AOL) and CompuServe. Sometimes called the “read” internet, users could only view and download content in the early stages of the web; users didn’t have much interactivity with what they were reading and viewing.

However, the code that the web was built on was often open source, so computer programmers could go under the hood and figure out how things work. This crucial factor allowed tech-savvy programmers to build upon existing technologies to create the next generation of the web.

Web 2.0

The next phase of the web, Web 2.0, began in the early to mid-2000s. This period ushered in an era of more dynamic and interactive internet experiences, like social networks and user-generated content.

Platforms like MySpace, Facebook, Twitter, and Youtube allowed users to not only passively consume content but actively participate in the web by creating and sharing content with others.

However, one criticism of this period is that the companies that benefited from Web 2.0 technologies, like Facebook (now known as Meta) and Alphabet (parent company of Google and YouTube), controlled user data in highly centralized databases. They were able to monetize the dynamic internet of Web 2.0 to become some of the world’s largest and most influential companies.

Web 3.0

Web 3.0 represents the latest stage of the web, replacing the need for large corporations to run the web in a highly centralized way. Proponents of Web 3.0 claim that, by using distributed ledger technology and artificial intelligence, technologists can create a decentralized web that still allows for the dynamic and interactive experiences of Web 2.0. Web 3.0 may enable users to control their data and content without risking privacy or relying on intermediaries.

Unique Features of Web 3.0

Because Web 3.0 is in its infancy, there is no standard definition of what it is or what it could be in the future. However, Web 3.0 has several unique features that make it different from previous generations of the web.


A critical feature of Web 3.0 is decentralization, meaning that no one entity will theoretically control all data and content. Instead, data will be stored across multiple locations simultaneously, rather than in a centralized database or server. Decentralization will help users maintain ownership of data and content.


We currently access the internet primarily through smartphones and computers, limiting how often we connect with the web. With Web 3.0, users may be able to access internet content anywhere at any time due to an increasing number of connected devices. We will experience this ubiquity mainly due to the Internet of Things (IoT), where everyday devices — like refrigerators and thermostats — are connected to the web.

Blockchain Technology

Decentralization of data will be enabled by blockchain technology. With blockchains, the data and connection across services are distributed differently from the centralized database infrastructure currently in use. Blockchain can also allow an immutable ledger of transactions and activity, helping to provide verifiable authenticity within Web 3.0.

Artificial Intelligence

Artificial intelligence and its offshoots — machine learning and natural language processing — will enable computers to understand and process information similarly to humans. This allows for more personalized and tailored experiences for users in Web 3.0. Additionally, artificial intelligence can help to automate tasks and processes, making it easier for users to get what they need from the web.

Web 3.0 Uses

Developers are increasingly using blockchain technology and artificial intelligence for several Web 3.0 applications that may change how we use the internet.


DeFi (Decentralized Finance) is a blanket term referring to trustless and transparent financial protocols that don’t require intermediaries to operate. Traditionally, financial services and products have relied on centralized authorities such as banks, brokerages, and clearinghouses. DeFi has shifted this power dynamic, providing the same financial services without a central authority, thus reducing fees and making financial services and products more accessible to more people everywhere. DeFi can operate without centralized management because of blockchain technology.


DAOs, or decentralized autonomous organizations, are a type of organizational structure built with blockchain technology. DAOs are run by their members, usually with crypto tokens providing voting rights like how stock gives shareholders power in a traditional corporation. DAOs may become the organizing entities for Web 3.0 services, providing some structure and governance in a decentralized approach.


A dApp (decentralized application) is, for the most part, similar to any other software application you may use today. What makes dApps different is how they function behind the scenes, with the app being powered by transactions taking place on a decentralized network rather than a centralized server. Most of the backend programming happens on a blockchain.


The metaverse refers to digital and virtual worlds where people can collaborate, socialize, shop, and even work and learn in 3D spaces. The metaverse may lead to a more immersive way of experiencing life on the internet.

Many of the experiences on the metaverse will involve various Web 3.0 applications. For example, if you try to buy a house in the metaverse, you may take out a mortgage through a DeFi lender.

💡 Interested in other metaverse investments? Learn how to start investing in the metaverse.

Pros and Cons of Web 3.0

There are many potential advantages of Web 3.0 compared to the current state of the web and the internet. For example, it could lead to a more personalized and interactive internet experience, especially in the metaverse, where users can connect more meaningfully. It could also lead to a more efficient, private, and effective way of sharing information and conducting business online due to DeFi and DAOs.

However, there are also some potential disadvantages of Web 3.0, especially considering that it is in its infancy and there is a lot we don’t know about how it will achieve its proponents’ lofty ambitions. For example, it could lead to a more fragmented internet, where users are less likely to see the same information or have the same experience as others. It could also lead to a more complex and challenging user experience on the internet, as the range of features, devices, and available applications increases.

Only time will tell whether Web 3.0 is a positive or negative development for the internet. However, it has the potential to revolutionize the way we use the internet and the way we interact with each other online.

Investment Opportunities for Web 3.0

Many people want to get at the forefront of Web 3.0 because of its novelty. This includes investors; many venture capitalists and individual investors have been getting involved in the space, hoping to profit from the rise of new technologies.

If you’re interested in investing in Web 3.0, there are several ways you can go about it:

•   Crypto: A common way investors can invest in Web 3.0 technologies is through cryptocurrencies, specifically crypto tokens of Web 3.0 projects.

•   NFTs: NFTs, or non-fungible tokens, are unique crypto assets that play a role in Web 3.0. NFTs can be used to show proof of ownership in the metaverse or as avatars in the metaverse.

•   Stocks: You can invest in the stocks of publicly-traded companies that are developing or using Web 3.0 technologies, like Alphabet, Block, Meta Platforms, Microsoft, and Roblox.

•   Exchange-traded funds: Investors can invest their money in a growing number of ETFs focused on Web 3.0 and related strategies.

The Takeaway

You’ll likely keep hearing about Web 3.0 in the coming years. And though we don’t know exactly how the use cases for Web 3.0 will shape up, it’s still important to be informed of this significant technological development.

Photo credit: iStock/Charday Penn

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