Will Web3 be the key to mass cryptocurrency adoption?
Web3 is one of the hottest buzzwords in the tech sphere right now, especially within the world of cryptocurrencies.
If you too follow the news, you will know that this imminent blockchain-based internet upgrade will be what moves cryptocurrencies, NFTs, DeFi and virtual reality from isolated environments within the network to being embraced en masse.
It’s no longer just forward-thinking startups supporting Web3, but also tech giants like Meta.
Although it is still in its conceptual phase, the participation of important participants only confirms that something big is cooking in this area.
What exactly is Web3, and why will it be the foundational crypto space?
What is Web3?
The Internet that we know today, or Web2, presents certain problems, especially in terms of privacy and the excessive influence of huge and practically monopolies.
It is a far cry from those early days of anarchy in which the technological concept was developed when it acted as a vehicle for the free and anonymous sharing of information and content created by the user (so that users could create their own web pages, communities and platforms, rather than providing content for existing platforms and social networks).
Today, a large part of the Internet is in the hands of platforms that derive economic benefits from the data and content that their users create.
We could understand Web3 as an attempt to put an end to the control exercised by these mega-platforms and transfer power to the individual user, as well as to communities as a whole.
In practice, it would be a matter of creating a decentralized Internet-based on privacy, peer-to-peer sharing and democratic governance, leaving aside intermediaries or platforms with great power. Does it ring a bell?
What role would cryptocurrencies play?
The crypto sphere already offers solutions for this type of organization, thanks to blockchain technology.
This would happen, for example, through the use of crypto tokens for governance used in DeFi and DAO projects, smart contracts for collaborations and encrypted but publicly accessible blockchains to guarantee security and privacy.
Blockchain technology provides the necessary tools to establish fair and direct peer-to-peer collaboration and democratic control of platforms.
This would make it impossible for a single organization, even a large one, to gain control.
If we add to this the fact that Web3 also includes the development of 3D digital environments and VR/AR interaction, we will see that the crypto sphere is even more useful for Web3.
NFTs will be able to track ownership and rights over digital objects, thus making it possible for users to use them to do business.
In a truly free Internet, even the use of cryptocurrency tokens as a currency could limit the influence of governments and banks, making the Internet less exposed to sanctions and repressive measures.
This assumption is perfectly consistent with the philosophy that gave rise to the appearance of Bitcoin (BTC): create a digital medium between individuals for exchange outside institutional control.
With the move to Web3, the use of cryptocurrencies will extend far beyond the limited capabilities of Bitcoin today.
Almost 5 billion people use the internet every day so in the 10+ years it would take to implement Web3, this would mean billions of people using blockchain and the crypto sphere in their lifetimes.
In this way, cryptocurrencies could be used as a form of payment between users around the world, for the administration of online platforms or as NFTs for avatars and lands in the metaverse.
Some cryptocurrencies already playing an active role within Web3 include Filecoin (FIL), Chainlink (LNK), and of course Ethereum (ETH).
All these and more than 40 crypto instruments are at your disposal at Binance.
Could cryptocurrencies be widely adopted without Web3?
The crypto sphere has ridden a new wave of popularity in the wake of the COVID-19 pandemic, but the number of people interested in cryptocurrencies solely for speculative purposes is not too high, and there will come a time when this interest will peak.
In order to be truly accepted in all spheres of our lives, cryptocurrencies must offer the masses possibilities of use that go beyond trading for profit.
In its current format, the crypto world suffers from serious scalability problems, an aspect that most blockchain projects raise as one of the main issues they aspire to solve.
It will be necessary to employ a large number of resources, both financial and human, if we intend to solve the problems of widespread adoption and scale, and this will only be possible if there is a desirable purpose such as Web3.
We are still in its early stages, and we will no doubt see many approaches competing for the development of Web3, including projects from Meta and other major technology platforms that those in the crypto community most concerned about privacy they will be cautious.
Likewise, the role played by governments that want to promote the development of the technology sector in their own countries, and that will have to find a way to regulate operations with cryptocurrencies, will also be important.
Regardless of the end result, all players agree that both blockchains and cryptocurrencies will be an essential part of this project.
How to prepare for Web3
Long-term investors should ask themselves, “what will the crypto ecosystem look like in the next decade?
Which projects are most likely to survive and develop future-use applications?” In order to be able to assess the constantly changing situation and to be able to adapt our trading strategy, it will be important not to lose sight of the crypto market, the news about the technological sector and the regulations adopted by the different governments.
Binance offers you the best conditions for trading crypto pairs in both rising and falling markets, with cumulative loyalty rewards, analytics, and even a free Bitcoin cloud miner on its easy and intuitive platform.
Whether you want to bet directly on the future of Web3 or build your own crypto wallet to profit from, give Binance a try today and see what the best cryptocurrency trading platform can do for you.