What Is the Decentralized Internet and Why It Matters for the Future

The decentralized internet, or Web3, is a new kind of online experience that distributes ownership and control of data over its user base. The internet most people use today, or Web2, runs on a corporate-owned infrastructure that uses centralized servers to store, transmit, and protect data. Users pay corporations to use Web2 services, like cloud storage, Amazon and Meta accounts, and Google Search by making tradeoffs, like ceding control of their privacy, consuming targeted ads, and/or paying fees. They may also have less control and choice over the information they consume as algorithms feed them content based on their digital identity.

Web3 seeks to provide users with an experience that is both transparent and secure. It is designed to loosen the hold of corporate power by helping users control and protect their identities and navigate the internet more freely. As people become more aware of the dangers of surveillance, cyberattacks, and more, the idea of reclaiming individual digital sovereignty is gaining traction.

Below, we’ll explore the core concepts of the decentralized internet as an alternative to the Web2 paradigm.

The Decentralized Internet

Web3 is a decentralized internet based on the idea of a community that exchanges information using public blockchains. Unlike centralized Web2 platforms, which companies like Google, Meta, and Amazon use to control online transactions, content, and data, Web3 blockchains empower individual users to own and govern parts of its infrastructure. It also means that two parties can engage in Web3 transactions without oversight of a central authority.

Web2 transactions usually require two parties who trust each other, plus a third party like a bank or a cloud storage provider, to facilitate any exchange of money or information. By contrast, Web3 puts data through a “zero-trust” verification process that eliminates the need for a middleman and allows two parties to make direct transactions. As a result, parties can exchange information privately with less risk of government or corporate pushback.

How Blockchain Shapes the Web3 Vision

The decentralized internet is built on blockchain technology. A blockchain is a distributed digital ledger that enables users to record and verify transactions across a network of computers instead of storing the information in a single location, like a server bank. As new entries are added to the ledger, new blocks are created and added to the chain. Every node on the blockchain is updated to reflect these changes, which cannot be reversed. Since these updates are redundant across nodes, the system is less vulnerable to control or attack from a single source.

Before social media and e-commerce platforms grew to dominate the internet, exchanging information online was a more free and egalitarian endeavor, but it was also less secure. When Web2 gained prominence in the mid-2000s, organizations like Facebook and Wikipedia began to monetize their users’ content, activity, and personal data by selling it to advertisers. As a result, the internet became less communal, and large companies took control over how the web functions. Web3 seeks to give power, privacy, and sovereignty back to its users using technologies like cryptocurrency wallets and private keys that eliminate the need for centralized oversight and control.

Other technologies that allow Web3 to function include:

Decentralized Storage Platforms

Decentralized data storage platforms are blockchain-based storage solutions that distribute data across nodes in a network instead of hoarding it in a server. These platforms allow users to store, access, and share data in a more private, secure, and scalable fashion. Storing data across several networked nodes reduces the risk of a security breach because a single vulnerability would only compromise the data at that node. On the flip side, since no single user or entity can gain complete access to a cache of data, it would be difficult or impossible for them to share that data with a third party without the original owner’s consent.

To maintain their reliability, decentralized storage systems have a built-in redundancy that makes them resilient to data loss. This means that if one node fails, users can retrieve the data they need from other nodes. These systems can also be designed to optimize the efficiency of retrieving data, which can make them fast and inexpensive to use.

Self-Sovereign Identity Systems

Another key Web3 component is the concept of Self-Sovereign Identity (SSI). SSI systems give users ownership and agency over their persistent accounts, or digital identities, by eliminating the need to use a third party like Google Sign-In or Meta Verified that controls their user profile. Users who have a self-sovereign identity can control who sees their data and choose which information they will share with websites, services, and applications across the web. SSI users can also revoke access to their data at will.

The SSI system is based on three pillars, which include:

• Verifiable Credentials (VCs): VCs are cryptographically secure digital credentials that users can present to verify their identities.

• Blockchain: The decentralized blockchain networks as the foundation of SSI are difficult to change, hack, or attack, which makes fraud less likely.

• Decentralized Identifiers (DIDs): DIDs allow users to identify themselves online without third-party verification.

The SSI system operates using a “trust triangle” between the holder of verifiable credentials, the issuer of the VCs, and a verifier. When a verifier asks for a holder’s VCs, the holder can choose whether they want to provide access to their data.

Challenges Slowing Widespread Adoption

Web3 is an exciting development in the evolution of the internet, but there are practical challenges to widespread use and interoperability that are slowing widespread adoption.

These include:

Scalability

Web3 architecture has several layers that facilitate its operation. The execution layer that deals with transaction processing, data maintenance, and security must be able to function efficiently, even when traffic is high. Unfortunately, executing multiple transactions that vary in complexity can lower the performance of the network. Scalability, which refers to how many computations per second a blockchain can process and validate, defines a network’s capacity to grow with its user base.

To scale effectively, a blockchain must be able to process several transactions at once without drastically increasing the amount of hardware it needs to do the job.

Unfortunately, the same design features that enhance security can create latency and throughput bottlenecks. Processing transactions one at a time and tracking and recording each operation creates overhead that can slow down validation. As more people use Web3, more hardware and nodes are needed to accommodate growing blockchains. Since it can take longer to access information that is spread across a greater number of nodes, the network can slow down as demand increases, making it less user-friendly.

User-Friendliness

When several people use a Web3 network at once, it can become congested. Users will compete by paying higher fees to process their transactions more quickly, which makes the network expensive to use. This can make it difficult for new users with limited funds to access, navigate, and use the network. In many cases, Web3 requires people to use a crypto wallet and understand the basics of blockchain to participate. Managing private keys, a decentralized identity, and multiple Web3 wallets can seem intimidating, tiresome, and overly complex to new users who are accustomed to using relatively simple Web2 accounts and e-commerce interfaces online.

Network Infrastructure

Although decentralization is essential to the Web3 philosophy, in reality, many networks rely on a centralized infrastructure to operate effectively. Large cryptocurrency wallets and NFT marketplaces with tens of millions of users tend to use IaaS providers that are incorporated as single companies. Smart contracts, Web3 protocols, and DeFi networks may run on a centralized system of servers. Furthermore, individual users of digital exchange companies may trust their providers to store their private keys for the sake of convenience. Without using centralized systems, Web3 networks could quickly become less secure, reliable, and usable.

The dominant internet protocols in use today were designed for Web2 networks. A predominantly decentralized internet needs a new kind of infrastructure to become fully functional. New protocols, plus network architectures like decentralized physical infrastructure networks (DePINs) and physical and digital resource networks, allow users to collectively operate utilities like WiFi, 5G, and IoT and manage computing power and bandwidth. DePIN networks can also include server, sensor, and energy networks that store data and provide geolocation and power services.

As people join networks and make their hardware available for use, they build the infrastructure of Web3 as they build their communities, without ceding control or ownership to a corporation. This empowers them to create services like decentralized wireless hotspots and free hotspots and make them available to anyone who uses their blockchain technology.

Quantinium Is Leading the Shift to Web3 with Next-Gen Wireless Solutions

As a leader in next-gen computing, Quantinium is invested in the success of the Web3 paradigm. We're contributing to this shift by developing Quantum Wi-Fi - an advanced wireless connectivity solution designed to support the future of decentralized systems. Our mission is to build infrastructure that empowers users with faster, more secure, and more autonomous connections in an increasingly decentralized world.