Which Web 3 Sectors Are The Most Investable?
In recent years, many have championed web3 sectors as the next phase of the internet's evolution, but since the word spans so much ground, discussions may get a little hazy.
Author:Gordon DickersonReviewer:James PierceMar 18, 202242.4K Shares597.3K Views
In recent years, many have championed web3 sectorsas the next phase of the internet's evolution, but since the word spans in a wide ground, discussions may get a little hazy.
What Is Web 3.0?
A data-driven and Semantic Web will be the emphasis of Web 3.0, which is the third generation of internet services for websites and apps that will use machine-based comprehension of data to deliver a data-driven and Semantic Web. The ultimate objective of Web 3.0 is to develop websites that are more intelligent, more connected, and more open.
Because Web 3.0 has not yet been deployed, there is no definitive definition of the term. More than 10 years passed between the introduction of Web 1.0 and the introduction of Web 2.0; it is predicted to take at least as long, if not longer, to completely deploy and transform the web with Web 3.0.
In contrast, the technologies believed by some to constitute the foundation of and eventually characterize Web 3.0 are now in the development stage of the process. Internet of Things (IoT) devices and smart home appliances that use wireless networks are just two examples of how Web 3.0 is already having an influence on technology.
After following the evolution of the Web from Web 1.0, which was an information provider where people read websites but rarely interacted with them, to Web 2.0, which is a collaborative, interactive, and social web that allows users to collaborate with one another, it can be assumed that Web 3.0 will change both the way websites are created and the way people interact with them.
What Is So Special About Web 3.0?
Web 3.0 may be built with AI, semantic web, and omnipresent qualities in mind. The purpose of adopting AI is to provide quicker, more relevant data to end-users. A website utilizing AI should be able to filter data and give it to a particular user.
Because the results include websites that people have voted on, social bookmarking may deliver better results than Google. Humans may, however, alter the outcomes. AI might sort authentic results from faked, akin to social bookmarking and social networking, but without the negative feedback.
The artificially intelligent web will also include virtual assistants, which are already developing as built-in features or third-party applications.
The semantic web's goal is to educate a computer on what certain data means. For improved content generation and sharing, websites should be able to recognize human-like search query phrases. The semantic web will educate a computer on what the data means, and the AI will utilize that knowledge.
Ubiquitous computing refers to embedded processing in ordinary things that facilitates device intercommunication. Web 3.0 is also expected to have this characteristic. It's like the Internet of Things.
These qualities will include microformats, data mining, natural language search, and machine learning. Web 3.0 will also emphasize P2P technology like blockchain. Web3 projectsapps may also leverage open APIs, data formats, and software.
Web 2.0 Vs. Web 3.0
The majority of people have only had direct contact with the internet via Web 2.0: online apps, the social web, and software as a service have become an integral part of our daily lives.
However, despite the fast advancement of other technologies, the fundamental web architecture has stayed substantially intact since the turn of the century.
Although web3 has yet to capture a significant part of the market, there are legitimate fears that its complexity will intimidate customers and authorities alike in the future.
However, our study revealed that the investment environment is becoming more competitive as venture capitalists become more informed and less suspicious as a result of the expanding number of venture capitalists.
Why Is Web3 The Future?
Web3, the next web version, focuses on decentralization, giving users more power. Web3 services are decentralized programs that operate on the blockchain network. The most famous of these networks is Ethereum.
What Is The Most Investible Sector Of Web 3.0?
In terms of reward/risk ratio, the following web3 sectors are ranked from low to high.
Web 3 Social Community, DeFi, And NFT
Web3 allows artists and producers to own not just what they create on a platform, but also the platform itself. Web3 is a new internet patron model. Web3 facilitates the establishment of cooperative ownership and governance systems. Web3 is not yet completely decentralized.
It's still much too early.
-Tascha(Twitter)
Decentralized finance (DeFi) is a new financial system that is built on secure distributed ledgers, similar to those used by cryptocurrencies. The system eliminates banks' and institutions' control over money, financial goods, and financial services.
People who lend money via DeFi networks generally get substantially higher interest rates than conventional banking institutions. Transparency and security are improved because smart contracts recorded on a blockchain, as well as all records of completed transactions, are accessible for anyone to examine.
continues to be restricted in its range
-Tascha(Twitter)
An NFT is a digital asset that symbolizes physical things such as art, music, in-game goods, and films. They are purchased and traded online, usually using cryptocurrency, and are typically encoded with the same underlying software as many cryptos.
Blockchains are used to buy, sell, and store NFTs. They can't be traded like bitcoin or other cryptocurrencies. NFTs may gain value or lose value. The future of NFTs is uncertain.
Many similar ventures, expensive investment research costs, illiquidity, and in a greater bubble than other areas.
-Tascha(Twitter)
Gaming/P2E And Storage
E. P. (Earn to Play gaming) refers to video games and virtual worlds that players participate in exchange for cryptocurrency token prizes. Some games demand players to make an initial investment in tokens or NFTs, while others enable them to earn cryptocurrency just by participating. As of 2022, Axie Infinity, Zedd Run, and Gods Unchained are among the most popular player-versus-environment games.
BLOCKCHAIN-BASED GAMING has piqued the curiosity of investors, with US$4.8 billion invested last year. The tremendous success of Axie Infinity has also ushered in a new age of non-fungible tokens (NFTs) and play-to-earn (P2E) games in 2021. Such blockchain-based games, in my opinion, are part of the next great wave in the crypto industry.
Similar to Defi, space is so competitive that the majority of the benefits accrue to the underlying L1/L2 levels.
-Tascha(Twitter)
A service that stores data redundantly among various Filecoin miners and the public IPFS network, gives information about where the data is kept, and retrieves data using the CID of the data it has received. An HTTP endpoint, a JavaScript client library, and a web-based user interface (UI) are provided for interacting with the service.
It is dependent on whether or not the project has promise beyond AWS S3 replacement. If the answer is no, it's not interesting. If so, it's comparable to L1/L2 in terms of structure.
-Tascha(Twitter)
Bridge/Cross-Chain Swap
When two blockchains are linked together via a blockchain bridge, also known as a cross-chain bridge, it enables users to transmit bitcoin from one chain to the other.
Essentially, if you have bitcoin but wish to spend it like Ethereum, you may do so by using the bridge to do this.
Currently, the industry is dominated by Layer 2 scale-out cross-chain bridges developed on Ethereum for improved interoperability.
By October 26, Footprint estimated the TVL of cross-chain bridges at $16.2 billion, up 72.25 percent in just 30 days. The four major cross-chain bridges, Avalanche, Polygon, Arbitrum, and Fantom Anyswap, account for 95.61 percent of the total cross-chain bridge, with a 401.23 percent rise last month.
It is expanding quickly, its moat is greater than its Defi, but its potential network impact is lower than that of L1/L2.
-Tascha(Twitter)
Alt L1/L2
A blockchain is referred to as a Layer-1 network in the decentralized ecosystem, but a Layer-2 protocol is a third-party integration that may be used in combination with a Layer-1 blockchain is referred to as Layer-2 protocol. Layer-1 blockchains, such as those used by Bitcoin, Litecoin, and Ethereum, are examples.
Investors looking to diversify their portfolios might consider altcoins. While some, like Ethereum's ether, are well-known, most of the over 10,000 altcoins have yet to build a reputation for themselves.
The greatest reward-to-risk ratio available in cryptocurrency. Why? Although less volatile than specialist sectors, they have a bigger potential return than Bitcoin or Ethereum. Because of the high liquidity and volume, it is simple to trade with a lower spread. If the project is successful, it has the greatest potential for network impact. The potential upside is significant.
-Tascha(Twitter)
Conclusion
Web3 (or Web 3.0) and web3 sectors is a notion for a new version of the World Wide Web-based on blockchain technology, including decentralization and token-based economy.
Gordon Dickerson
Author
Gordon Dickerson, a visionary in Crypto, NFT, and Web3, brings over 10 years of expertise in blockchain technology.
With a Bachelor's in Computer Science from MIT and a Master's from Stanford, Gordon's strategic leadership has been instrumental in shaping global blockchain adoption. His commitment to inclusivity fosters a diverse ecosystem.
In his spare time, Gordon enjoys gourmet cooking, cycling, stargazing as an amateur astronomer, and exploring non-fiction literature.
His blend of expertise, credibility, and genuine passion for innovation makes him a trusted authority in decentralized technologies, driving impactful change with a personal touch.
James Pierce
Reviewer
James Pierce, a Finance and Crypto expert, brings over 15 years of experience to his writing. With a Master's degree in Finance from Harvard University, James's insightful articles and research papers have earned him recognition in the industry.
His expertise spans financial markets and digital currencies, making him a trusted source for analysis and commentary. James seamlessly integrates his passion for travel into his work, providing readers with a unique perspective on global finance and the digital economy.
Outside of writing, James enjoys photography, hiking, and exploring local cuisines during his travels.
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