What is the relationship between blockchain and Web3?
Cryptocurrencies and blockchain are the building blocks of Web3. However, the decentralized web also relies on technologies such as AR, VR, IoT and others unrelated to blockchain or digital currencies.
The third generation of the internet, known as Web3, is based on blockchain technology. However, technologies such as machine learning, big data, artificial intelligence (AI), the Internet of Things (IoT), augmented reality (AR), virtual reality (VR) and other decentralized apps (DApps) allow for analyzing information in a sophisticated human-like way in a Web3 environment.
For example, virtual reality headsets will create an exceptional shopping experience, allowing customers to interact with the products before making a purchase. However, these technologies are not based on cryptocurrencies or distributed ledger technology, but aim to increase the efficiency of blockchain technology.
Furthermore, blockchain plays a significant role in building the infrastructure of Web3 by allowing organizations to decentralize Web2 services, including cloud computing, social networking sites, and databases. Therefore, a combination of AI and blockchain technology will undoubtedly provide organizations with a better way to manage confidential data sets.
By validating the supplied data, AI technology can quickly complete the process request and the smart algorithm will help make quick decisions regarding the issuance of funds or approval of credit. The data sets can also be effectively protected via the blockchain. Likewise, other technologies such as AR and VR are crucial to defining the metaverse, exploring new ideas and elevating virtual experiences.
Also, cryptocurrencies eliminate the need for a trusted middleman by allowing Web3 users to use tokens such as Ether (ETH) to send and receive money. That said, cryptocurrencies support peer-to-peer payments and can serve as a digital native payment method. Blockchains would lack the incentive system for network involvement without cryptocurrencies. Users would also have no place to store their cryptocurrency without crypto wallets.
In addition, Web3 is intended to be permissionless, trustless and open to all, as it embraces the crypto ethos. Similarly, non-fungible tokens (NFTs) allow users to transparently demonstrate proof of ownership for items such as in-game assets, digital art, personal data, and others.
