Is Web3 Dead? What You Need to Know (2024)

The term Web3 refers to the future decentralized internet, and there is currently a lot of debate around its potential. While some argue that Web3 has lost its momentum and is declining, others believe it still has significant potential. Many are now asking: Is Web3 dead? Has the bubble burst, or is the revolution still on the horizon?

This article sheds light on the state of Web3 today and its place in the digital landscape.

The Web3 hype of 2022

The initial hype of Web3 – Image via Freepik

Web3 is the new version of the internet. It aims to make the internet more equal and fair. Web3 uses special technologies to do this, like tokens and cryptocurrencies. The initial hype for Web3 was based on:

The NFT boom: The year 2022 saw a meteoric rise in the popularity and valuation of NFTs. Luxury brands like Gucci sold virtual items, even eclipsing their physical counterparts in price.

Brand engagement: Numerous significant brands, from Miller Lite to Google, were eager to use Web3 technology. Whether it was building virtual bars or signing deals with crypto platforms, the interest was palpable.

However, with all highs come eventual lows, and Web3 has faced numerous challenges that have questioned its viability.

Also Read: Beginner’s Guide – How to Invest in Web 3.0 – 3 Tips and Strategies

The cryptocurrency crash

One of the major setbacks for Web3 has been the crash of cryptocurrencies, which form the backbone of this new paradigm. The flagship cryptocurrency, Bitcoin, has experienced a significant decline, with its value plummeting by 66% from its all-time high. Ethereum, another prominent cryptocurrency, has also faced a steep drop in value.

Cryptocurrencies are essential for many Web3 applications, and the decline in their value has made it more difficult for these applications to attract users and investment. Additionally, the volatility and instability of the cryptocurrency market have made it difficult for businesses to adopt Web3 technologies.

Scalability and sustainability issues

Another challenge that Web3 has faced is the issue of scalability. The blockchain technology that underpins Web3 has struggled to handle large volumes of transactions efficiently. High gas fees and the costs incurred for executing trades on the blockchain have made even basic transactions on Web3 platforms unsustainable for many users.

Additionally, concerns about the environmental impact of blockchain technology have emerged. The energy-intensive process of mining cryptocurrencies, coupled with the carbon footprint associated with blockchain networks, has raised questions about the sustainability of Web3.

Lack of real-world use cases

Web3 has also been criticized for needing tangible, real-world use cases. While there are some successful Web3 applications, such as Bitcoin and Ethereum, many other Web3 projects still need to deliver on their promises.

The proliferation of low-quality projects and the prevalence of “shitcoins” and speculative investments have further tarnished the image of Web3. Additionally, the focus on NFTs and the hype surrounding them has overshadowed the potential of Web3 to revolutionize various industries and sectors.

Also Read: What is Web3 Wallet and How Does It Work?

The optimistic outlook

Leveraging the power of Web3 – Image via Freepik

Despite the challenges and criticisms, some still maintain an optimistic outlook on Web 3. They believe that the current setbacks are temporary and that the underlying principles of decentralization and user empowerment will prevail in the long run.

• Continued brand interest: Even in this seemingly dormant phase, some significant brands quietly yet consistently invest in Web3 technologies. They believe that public sentiment will swing back in favor of decentralized technology.
• Shift in marketing tactics: Web3 campaigns now have a more grounded approach, moving away from the sensationalism of early 2022 and adopting a cautiously optimistic stance.

Evidence of this continued interest can be seen in big-name brands still investing in blockchain-based endeavors:

• Mastercard: Through its Artist Accelerator program, Mastercard is allowing emerging musicians to harness blockchain for their benefit, bridging the gap between art and technology.
• Nike: Demonstrating its pioneering spirit, Nike has ventured into the Web3 space with its Swoosh platform, allowing fans to dive into the design process and earn from their efforts.
• Deloitte: In partnership with Vatom, Deloitte has launched a platform aiming to create immersive, virtual experiences, banking on the idea that the metaverse and Web3 will still shape the future of online interactions.

The continued interest from the above-mentioned brands is significant because it suggests that Web3 is not dead or just a speculative investment but a technology with real potential to impact businesses and consumers in the long term.

Developers’ enthusiasm for Web3

A report from consulting firm McKinsey suggests that developers remain enthusiastic about Web3 despite the decline in the crypto market. The number of monthly commits to open-source Web3 projects has doubled over the past few years, signaling continued interest and involvement in developing Web3 technologies.

This sustained engagement from developers indicates that there is still faith in the potential of Web3 to reshape the digital landscape. The steady increase in active developers further demonstrates the commitment to advancing Web3 technologies despite the challenges faced by the industry.

Also Read: How to become a Web3 developer — A Comprehensive Guide [2024]

The emergence of Web5

As the Web3 narrative undergoes scrutiny and reassessment, a new contender has emerged to save the future of the internet: Web5. Jack Dorsey, a prominent figure in the tech industry, has expressed skepticism about Web3 and revealed his plans for Web5.

According to Dorsey, Web3 has yet to fulfill its promises and has become controlled by venture capitalists prioritizing speculative investments over valuable innovation. To address these issues, he proposes Web5, which prioritizes decentralization, privacy, and user empowerment. This solution aims to overcome the limitations of Web3.

Navigating the future of Web3 and beyond

The future of Web3 – Image via Freepik

It is important to note that Web3 is still in its early stages of development. It is taking time for the technology to mature and for real-world use cases to emerge. However, the fact that major brands and developers are still investing in Web3 suggests that there is still significant interest in the technology.

The digital landscape revolves around more than just Web3. Other promising and challenging emerging technologies like artificial intelligence, cybersecurity, and sustainable solutions exist. It’s essential to have a comprehensive awareness of the technological landscape and be flexible enough to adapt to changing trends and opportunities.

Lastly, the question of whether Web3 is dead or alive is a subjective one. Even though it has faced problems and criticism, people still believe it can bring change. The future of Web3 might depend on developers, innovators, and users trying new things with blockchain technology. It’s vital to be open to new technology and trends as the digital world changes.