The world of blockchain and cryptocurrency has been a mainstay in tech conversations for the past several years. Once seen as highly speculative and merely a trend, blockchain has since proved it is here to stay. This is due to a growing adoption from everyday people, techies, investors, businesses, etc.
One of the main drivers of blockchain technology adoption is the emergence of cryptocurrencies. Some of the most popular crypto coins include Bitcoin, Ethereum, Dogecoin, and Litecoin. As of March 2022, there are more than 18 thousand cryptocurrencies available to consumers worldwide. It’s safe to say, the crypto market has exploded.
One of the main benefits of blockchain and crypto is their countless use-cases. These include making peer-to-peer transactions, smart contracts, supply chain management, real estate, and more. Additionally, new use-cases continue to appear as people research how to apply the emerging tech. Discovering new and viable use-cases will be essential for blockchain’s evolution and will help ensure it becomes a mainstay in our everyday lives.
There is also the potential emergence of Web3. Web3 is the next iteration of the internet. Web3 uses blockchain technology to create a decentralized internet. Additionally, Web3 will help support other emerging technologies such as the metaverse.
A blockchain is a growing list of records or ledgers stored across a peer-to-peer network, joined by strong cryptography. Each block contains a cryptographic hash of the previous block (this is how two blocks are connected), a time-stamp of the transaction that the block represents, and additional transaction data. Instead of the traditional way of storing transaction data in a single, central computer, blockchains store replicas of a particular database across various computers in a network. These computers and devices in a network are called nodes.
Cryptocurrency, also known as crypto, is a form of digital currency that is primarily decentralized. Cryptocurrencies are decentralized, which means they do not have a governing or regulatory body like banks or governments to control access to them. On the other hand, traditional fiat currencies like the Dollar, Euro, and Yen are typically backed and regulated by governments.
The digital-only nature of cryptocurrencies means that they are generated and exchanged exclusively online. This process happens via a distributed peer-to-peer network. Values for most cryptos are also not pegged to fiat currencies as a result, and they are also immune to precious metal price fluctuations.
To understand Web3, we first need to cover Web1 and Web 2. Web1 was primarily read-only and composed of static websites. Web 1 was in effect from 1991 to 2004. Web2 is the internet that we currently know and use. It revolutionized the idea of the internet as a platform and was built on several key tech innovations, such as full-featured web apps, dynamic HTML, and relational/non-relational databases. In addition, anyone can create and monetize content on Web2. As a result, a plethora of custom content has given rise to blogging, social, e-commerce, and video-sharing websites.
Web3 is the internet of the future. One that is entirely decentralized, permissionless, and driven by peer-to-peer technologies like blockchain. This means that data transmission between two peers does not need a central authority to be ‘verified’. Instead, authentication happens at the user level. Additionally, in Web3, the internet is not overseen by a governing body. The benefits of decentralized service providers include having millisecond latency and removing gatekeepers, enabling a faster, more secure method of monetary transaction.
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