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Innovation is at the heart of all disruptive ideas and technologies that have seen mass adoption on a global scale. The advancement of the Internet represents a relationship between such innovation and persistent commitment to a seemingly unfathomable future. To truly define the world of tomorrow and prepare businesses, applications and organizations to start scaling the so-called Web3, we must first understand the history of the internet and the web and its natural evolution towards a future built on verifiability and Trust-free based services and decentralized protocols.
A short story
For decades, the Internet served as an “abstract” concept of limited utility for government organizations and universities, allowing multiple computers to communicate with each other on a single network. It was not until the early 1980s that the advent of communications protocols (TCP) and normalized systems (DNS) laid the foundation for the Internet as we know it today.
Almost a decade later, the online world took a more recognizable form with the advent of transmission protocols (HTTP) that power the World Wide Web – an invention credited to several scientists, engineers, and programmers dedicated to providing an “information superhighway.” “ have prescribed for users.
In its original form, the web-enabled public use of access to data provided over the Internet. Web1, or the read-only web, is characterized by clickable hyperlinks that link content and information with limited interaction. Technologies powered by Web1.0, such as Google and Yahoo, still serve critical use cases for the global Internet as we know it today.
In the early 2000s, the emergence of various web protocols enabled read and write interactions that could be used to associate programs with content. In its current iteration, and probably the version of the web most familiar to readers, Web2 allows users to both consume and produce their own content. Blogs, internet forums and marketplaces emerged after the autonomy in content creation that also ushered in the age of social networks.
While Web2 has undoubtedly brought tremendous benefits to users, rent-focused centralized entities have taken advantage of this free flow of information to monetize user data and behavior. A breach of trust, user exploitation, and data lockdown have led to the need for a web that truly belongs to the creators and users.
The hope for a decentralized future
Web3 aims to do what the internet has failed to do: promote open services powered by decentralized protocols rather than centralized applications controlled by tech giants. Web3 can be viewed as the “read/write/home” version of the Internet – users can link programs and content directly, bypassing central intermediaries. Open services built on Web3 promote permissionless access, optimize value and ensure auditability. These services are far more resilient, fair, and ethical.
Instead of accessing technical platforms in exchange for monthly fees and personal data, users themselves participate in the management and operation of the protocols. The participants are real network actors and not just customers or products that are being exploited through economic pressure.
In this environment, tokens or cryptocurrencies represent accessibility, governance and ownership of decentralized networks. While in Web2 you are the product, in Web3 you are the owner.
The future landscape of Web3: DAOs
Many mainstream giants in both technology and payments are moving to a variety of Web3 programs. NFTs (non-fungible tokens) are at the forefront of this adoption, and DAOs (decentralized autonomous organizations) will drive the next wave of user adoption in Web3, collective ownership and accessibility.
Broadly speaking, DAOs are organizations run by a group of individuals who establish their own governance and make decisions that are executed through smart contracts on the blockchain. DAOs eliminate the need for a central entity or point of control—with the core goal of bringing together a community of users with similar interests to work together towards a common goal. Being set up on an open blockchain supports the principles of Web3 as all contracts, decisions and transactions are publicly viewable and auditable – and individuals remain the owners.
In the context of NFTs, DAOs can be used to support collective ownership. Built-in vaults are only accessible with member consent, and decisions are made through group voting during specific time periods. AS NFT prices have skyrocketed, a negative consequence is that many collections have become relatively inaccessible to individual users. DAOs like PleasrDAO allow members to share the cost and ownership of individual NFTs together, creating a level playing field and reinforcing the decentralization ethos of accessibility and inclusion.
From social media DAOs like Friends with Benefits to governance DAOs in play-to-earn gaming, DAOs also provide a governance structure for Web3 that encourages participation and reduces the risk of corruption or censorship. DAOs will continue to thrive as they become more popular and penetrate nonprofits, decentralized finance, and NFT collections. Moreover, rather than being held back by hierarchical structures, DAOs enable instant decisions to be made once consensus is reached among all members involved.
Charities are a prime example of businesses that will benefit greatly from the DAO structure. Oftentimes, the money and time spent on administrative tasks and resource allocation decisions exceeds the time spent on charitable activities. DAO implementations can quickly and effectively distribute funds to the right channels. The result: charities that achieve greater impact from their goals.
DAOs can also serve as a direct route for investment and accelerated DeFi (decentralized finance) adoption. DAOs using cryptocurrencies enable low cost and near-instantaneous peer-to-peer transactions that are not subject to the regulations of traditional financial institutions. Through lending or transaction fees, members can earn better returns than if they had held assets in a traditional financial institution. This area is growing rapidly with no signs of slowing down in the near future.
With this generation’s strong focus on social media and content creation, NFTs and the advent of DAOs to purchase and store these digital assets further enable the creator economy. Creators benefit directly from their artwork as the value of their product is tied to their brand, fan base and organization.
In the future we can expect that DAOs will allow users to easily jump into Web3 like so many large organizations and companies do.
Anthony Georgiades is co-founder of Pastel Network.
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