What Exactly Is Web3 And Why Should We Care?

Your most pressing questions about the future of the internet, answered

If you’re like us, you have a whole list of questions about Web3, one of which may be: is Web3 a revolutionary opportunity that will allow every one of us to contribute to creating a better version of the internet or is it a hotbed for scams?

At this point in time, it’s difficult to say which one it’ll be—if either at all—as Web3 is still a nascent idea that has yet to fully materialise. But what advocates have been saying about the proposed successor of Web2—the version of the internet we’re in now—is no less intriguing.

When Ethereum co-founder Gavin Wood coined the term “Web 3.0” in 2014, he described the next era of the internet then as a “peer-to-peer web that lets you do everything you can now”, without the need for servers like Amazon Web Services or authorities like Google or Facebook to manage the flow of information. In an opinion piece from 2018, he further explains it in a rather poetic manner, "Consider Web 3.0 to be an executable Magna Carta—the foundation of the freedom of the individual against the arbitrary authority of the despot."

To better understand the basics of Web3 further, we speak to entrepreneur Ivan Yeo for his insights. The co-founder and chairman of Evos Esports, which manages professional esports players across Southeast Asia, is currently working on expanding his portfolio into Web3, focusing on the gaming industry.

Above Ivan Yeo, co-founder and chairman of Evos Esports. (Photo: Darren Gabriel Leow)

In simple terms, how can we differentiate Web3 from Web1 and Web2?
American entrepreneur and investor Chris Dixon summarises this the best in one of his tweets:

Web 1: Read
Web 2: Read / Write
Web 3: Read / Write / Own

Web1 was about static web pages like Craigslist, where users enter the site to view and read. Web2 is about interactive web pages like Facebook and YouTube, where users are able to do more than just read. They can communicate, share or view videos and photos. It also marked the rise of user-generated content, where users are now able to contribute content to web pages. Web3 marks a new era of the internet, where users become participants in networks and have ownership over their content, data and digital assets.

Some say Web3 is a hotbed for scams, others say it's a life-changing opportunity. Is it one of them, both or neither?
As with all new technologies, the early days are always filled with scams and doubters. In the 1980s, the internet was thought to be a fad. In the 2000s, mobile apps were thought to be a fad.

Naturally, at the dawn of new technologies, a gold rush ensues, as we’ve seen with e-commerce in the 1990s and social media in the early 2000s. But history has taught us that majority of companies will fail once the dust has settled and the hype subsides. So it is important for entrepreneurs and creators to look past the biased opinions and view matters objectively, to understand the core technology and figure out its implications on our careers.

Communities are said to be the lifeblood of Web3. What does this mean for creators and entrepreneurs looking for new opportunities?
With Web3, people become the most important metric to focus on, instead of the usual metrics like daily active users, impressions or revenue run rate (though they are still important). This is because of the issuance of NFTs or tokens that will align the interests of the entrepreneur or creator and the community.

Entrepreneurs and creators in Web3 are rewarded for delivering value to their community, which gives back to the project through participation via promoting, engaging or contributing to it. This creates an attractive flywheel effect, where value creation encourages community engagement and growth, which in turn increases the value of a project’s NFTs or tokens, which ultimately attracts more people to join the community.

What are its biggest potential pitfalls, problems or dangers?
The biggest problem with Web3 right now is the lack of education. It is hard to discern who is an expert in the field and who to listen to, mostly because Web3 is still in its experimental phase. It can also be intimidating for people to enter the space as the jargon used can be complicated at times. Without guidance, it can be a steep learning curve.

Web3 marks a new era of the internet, where users become participants in networks and have ownership over their content, data and digital assets

- Ivan Yeo -

In the context of gaming and esports, how can blockchain technology better enable these industries?
For the longest time, gamers have spent billions of dollars on in-game assets only to have it all go to waste when they switch over to another game. We spend money on in-game skins and currencies but in reality, we don’t own them. The rise of NFTs marks the beginning of the ownership economy, where gamers can own as well as potentially earn from the time they spend playing these games.

In terms of the esports industry, there has always been an obsession with big numbers. The industry revolves around standard social media metrics of views, engagement and impressions, which are highly sought after by brands looking to market their products to the younger generation. This, however, creates a misaligned relationship where more views do not equate to better experiences for the fans. This relationship pushes esports teams to sacrifice their fans to chase revenue, as they focus on trying to monetise their fanbase through merchandise and hard-selling.

With blockchain and NFTs, esports teams can identify their community of die-hard fans, which will allow them to provide more value in the form of airdropping NFTs and exclusive experiences for their NFT holders. This re-aligns the relationship between teams and fans, as both parties are incentivised to do the best for one another.

This leads to a similar flywheel effect I mentioned earlier, where the brand equity and influence of esports teams grows, allowing them to attract more meaningful partnerships and sponsorships, and in turn, provide even better community benefits, which increases community support even more and the cycle continues.

What other Web3 opportunities are you excited to see?
As Web3 entrepreneurs look for new use cases to speed up the adoption of blockchain technology, I’m excited for the Web3 evolution of creator platforms, gaming and social networks over the next three years.

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Topics

web3 nft technology future esports gaming ivan yeo

Tatler Asia

What Exactly Is Web3 And Why Should We Care?