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2 - The First Principles of Web3

from Part I - Foundations of Web3

Published online by Cambridge University Press:  21 November 2024

Ken Huang ,
Youwei Yang ,
Fan Zhang ,
Xi Chen  and
Feng Zhu
Ken Huang
Affiliation:
DistributedApps.ai
Youwei Yang
Affiliation:
Bit Mining Limited
Fan Zhang
Affiliation:
Yale University, Connecticut
Xi Chen
Affiliation:
New York University
Feng Zhu
Affiliation:
Harvard Business School
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Summary

Chapter 2 leverages first principles thinking to reveal the seismic shift enabled by Web3’s self-sovereign Internet and decentralized economic architecture. Opportunities emerge in infrastructure, access, efficiency, accountability, and empowerment. On-chain data sharing and self-sovereign identity allow efficient bootstrapping in an open ecosystem. Decentralized finance increases financial access, while blockchain ID could facilitate inclusive programs such as universal basic income. By automating manual workflows, smart contracts and traceability boost efficiency. Immutable blockchain ledgers enhance transparency via innovations such as triple-entry accounting. The creator economy shifts power by enabling direct content monetization and ownership through NFT marketplaces, decentralized social platforms, and games. Despite adoption hurdles, Web3 fundamentally reshapes incentives around user control over identity, data, and value creation in a decentralized economy. Capturing the full potential requires reimagining economic systems, not just optimizing current models. This epochal shift promises to unlock tremendous value by aligning technology with empowerment in an open, user-centric Internet.

Type
Chapter
Information
Web3
Blockchain, the New Economy, and the Self-Sovereign Internet
 , pp. 41 - 70
Publisher: Cambridge University Press
Print publication year: 2024

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