Web3, blockchain, NFT, and Metaverse are the hottest topics of discussion in recent times. These are undoubtedly the high-profile tech concepts that can potentially grow to be the new future. In addition to this, technological developments are a wide array of opportunities for businesses. So, let us waste no more time and delve a bit deeper into the topics to gain a detailed understanding.
Web3 also referred to as Web 3.0, is actually an idea for a new iteration of the World Wide Web based on blockchain technology. It incorporates the concepts of decentralization and token-based economics. There are a few technologists and journalists who have contrasted Web 3.0 with Web 2.0, where they have stated that the data and content are centralized in a small group of companies which are sometimes referred to as “Big Tech.” Gavin Wood, the co-founder of Ethereum, first coined the term in the year 2014. However, the idea started gaining interest in the year 2021 from large technology companies, cryptocurrency enthusiasts, and venture capital firms.
Web3 is still largely in the theoretical stage at this point in time and has an extremely steep learning curve. It is very rightly termed as the next generation of the web, where the internet services and mobile apps are rebuilt on the decentralized blockchain technology. Web3 advocates such as Chris Dixon from venture capital firm a16z state that building on blockchain technology will propel companies to be interoperable and provide the users with property rights, that is, the ability to own a piece of the internet.
Web3’s primary idea is about the even distribution of online power, thereby helping to create a decentralized web. One conference speaker mentioned how with the help of Web3, we would get a chance to go back to the root of the internet before companies such as Google, Facebook (now Meta), Apple, & Amazon took over and captured all the value. It is this idealized form of the internet that creates a sense of excitement among the users with Web3’s concept. We have to wait and see what the future holds for Web3.
Understanding Blockchain and Its Role
Blockchain is essentially a database that plays a vital role in keeping a decentralized as well as a secure record of transactions. Blockchain structures data into small blocks of data that are woven together in the form of a chain, unlike a database that structures data into tables. At the time when a block is completed, it gets a timestamp and becomes a permanent part of the chain. This, in turn, results in a data timeline that is irreversible in nature. The innovation of blockchain is that it maintains the fidelity as well as security of a data record, hence establishing trust without the involvement of any intermediaries or third parties. It is precisely the reason why blockchain presently plays a significant role in cryptocurrency systems like Bitcoin.
Blockchain happens to be an excellent major source of vehicle for the purpose of delivering information. Hence, they are appropriately designed for the use of a business. It is because of the fact that with the receipt of faster and more accurate information, the better it is for business. Blockchains have the potential to deliver immediate, shareable, and completely transparent information that is kept on an immutable ledger that allows only permissioned network users to view.
Blockchain allows managing as well as trading both tangible and intangible assets of any value. Tangible assets can be property, land, car, cash, etc., whereas non-tangible or intangible assets can be copyrights, patents, branding, etc. For instance, in business, we can consider orders, payments, accounts, production, and a number of others, all of which can be easily tracked with the help of a blockchain network. The users have greater confidence along with additional efficiencies and opportunities as a result of the transparency of transaction information.
Non-Fungible Tokens or NFT, and Why Do We Care About Them?
NFT or Non-fungible token is a blockchain-based digital file that permits collectors to own one-of-a-kind, limited-quantity artifacts which appreciate in value during the result of an auctioning process. These tokens are non-interchangeable and unique cryptographic assets that permit users to tokenize different items such as collectibles, art, and even real estate. It is to be kept in mind that NFTs can only have one official owner at a time, and no other person can alter the record of ownership or copy a new NFT into existence. A few examples of NFTs are unique digital artworks, tickets that provide entry to an event such as a virtual concert or in-game collectibles. NFT games are all the rage at the moment. NFT gaming allows gamers to have ownership with options to swap, create, and implement NFTs within a game. While gaming NFT Marketplace developers create smart contracts that make up the rules for the NFTs used.
NFTs use unique identification codes as well as metadata for differentiating from one another. This, in turn, makes these items truly one of a kind since it is not possible for one NFT to be equal to another. Here lies the point of difference between NFTs and cryptocurrencies like Bitcoin that are fungible assets. DappRadar, a digital analytics firm that tracks NFT data on different platforms, brought to light that the total market volume generated by the NFTs in the year 2020 was about 95 million dollars which increased to 2.5 billion dollars by the end of Q2 of 2021.
The non-fungible tokens hold a very strong market efficiency since they have the ability to streamline processes by eliminating intermediaries or involvement of any third party, simplify transactions, and create new markets. This, in turn, helps them become a perfect vehicle for businesses to digitally represent a range of physical assets like property, artwork, etc., as non-interchangeable items. non-fungible tokens function as legally binding contracts that are traded on the blockchain. They authenticate both digitals as well as physical assets, thereby permitting artists, musicians, writers, photographers & other owners of intellectual property to protect and sell their work. This, in turn, provides the content creators with digital protection and a platform from which they are able to earn profit from their work.
These tokens also create an extremely interesting opportunity for social networking. There are some conference speakers who state that buying specific NFTs provides the users with access to valuable communities where they get an opportunity to learn and connect with other enthusiasts and even find mentors. While a few others were of the viewpoint that NFTs could be the future of social networking, where people can build communities based on the non-fungible tokens they own.
Brands, on the other hand, might use non-fungible tokens to generate unique experiences, memorable marketing campaigns, partnerships, iconic imagery, luxury designs, and a number of others. This, in turn, opens up an entirely new market by injecting funds within a short span of time. Moreover, NFTs allow companies to keep possession of their original assets without any kind of worry regarding manipulation, modifications, or knockoffs. This new method of encouraging consumer interaction empowers businesses to create their own tokens where they are able to provide new as well as existing customers with the ability to buy goods & services uniquely and timely. NFTs will not be going away any time soon, and these tokens are now proving to be an extremely lucrative opportunity for entrepreneurs.
Checking Out the Metaverse
The Metaverse happens to be an immersive digital world with virtual avatars as the population that represents actual people. They exist in real-time as a place that is continuously active. The Metaverse is seen as a self-contained and fully functioning world containing content generated by the users. The Metaverse is considered more as a wide shift in how we interact with technology rather than a new type of technology. Understanding the Metaverse can be a bewildering experience since it is still in the building phase, and no one has a very clear idea about how this will run or come into existence.
The Metaverse is a virtual reality world that continues to exist even at a time when you are not in it. It combines the aspects of both digital as well as physical worlds and is expected to be a huge asset for the purpose of the development of businesses. This, in turn, follows through into a digital economy inside of the Metaverse, where users are able to create, buy, and sell goods. It is possible to attend virtual events with one’s personal avatar and interact with others. It is expected to continue developing into a large interactive and widely promoted alternate reality. Users can shop, easily attend virtual conventions and test products that too from the comfort of their own home. Now, when one moves the experience online, the size of the audience grows at an exponential rate.
After going through, the readers have gained a clear understanding of these new and evolving technological terms. Each of these concepts is new to the market, and to gain a deeper understanding, a sufficient amount of time is required. Blockchain and NFTs are still older as compared to the other two. Blockchain and NFTs have been widely used in an array of industries to enjoy the benefits offered by them. Thus, we need to wait and see what the future has on hold for Web3, Blockchain, NFTs, and the Metaverse.