Web3 Infrastructure
Note: Data in this section last updated September 12th, 2022
To understand how Web3 would work, we first need to understand how the internet works today.
Although the terms are often used interchangeably, the internet and web aren’t the same thing.
The internet is the physical infrastructure of computers and cables that powers the world wide web – a digital collection of webpages and apps that lives on this network.
In 2006, the late Sen. Ted Stevens was relentlessly mocked for saying that “the internet is a series of tubes”.
Ironically, Stevens was kind of right. At its core, the internet is nothing more than a collection of computers that are connected to each other through a global network of “tubes” (aka “wires”). In fact, that’s where the word comes from – interconnected networks.
These connections allow computers to “talk” to each other to do things such as 1) send an email, 2) get a website or 3) buy goods and services.
To understand how a decentralized internet works, let’s take a journey though the evolution of these computers and wires.
Pre-Web
The internet was originally created by the United States Department of Defense as a messaging system that could withstand a first-strike nuclear attack.
The first versions, known as ARPANET, were decentralized – they were little more than groups of computers (fewer than 100 for most of the 70s) directly connected to one another through telephone lines.
The Internet in 1972 Connected a Handful of Computers Through Telephone Lines
While telephone lines proved sufficient for the early internet, they soon ran into problems.
Because computers think and communicate in 1s and 0s – a language called “binary” – all information is sent across the internet in this format. Each one or zero is called a “bit”, and 8 bits make up a “byte”. For example, in computer language the word “cat” translates to “01100011 01100001 01110100”, while a picture of a cat could contain millions of 1s and 0s.
These 1s and 0s can be transferred over a standard telephone line by transmitting alternating electrical pulses (1 if the pulse is on and 0 if it is off), but it’s not very efficient. Commonly known as “Dial-Up”, these networks were limited to 56 kilobytes per second (at that rate it would take over a minute to download a modern iPhone photo and 8 days to download a 4K movie).
As such, the infrastructure eventually expanded into new mediums with much faster speeds, including:
DSL (100 Mbps): DSL also transmits electrical pulses through existing copper phone wires, but it travels over previously unused frequency ranges, making it much faster than Dial-Up
Cable (1 Gbps): Cable companies can transmit electrical pulses through the same coaxial cables used to provide TV services
Fiber Optic (5 Gbps): Fiber optic cables use alternating pulses of light to represent 1s and 0s (light on for 1; light off for 0). They are the preferred medium for long-distance transmission, and 99% of international traffic is carried over fiber optic cables (most of them undersea)
Wi-Fi (100 Mbs – 1 Gbps): The internet also uses “Wi-Fi”, a wireless network that uses radio waves. By adjusting the frequency of these waves, networks also use the binary formula, sending one type of wave to represent a “1” and another to represent a “0”. Your smart phone is actually a radio!
Satellite (100 Mbps): Radio waves can also be used to send data to and from existing satellites
These evolutions increased the efficiency of the network and allowed for the creation of new paradigms such as the world wide web.
Web 1.0
For decades, the internet was primarily used as a messaging device. From the time the first email was sent in 1971 until the early 1990s, the vast majority of the internet’s traffic was text based and largely used for academic purposes.
This all changed when Tim Berners-Lee’s invented the world wide web.
As the name suggests, the world wide web introduced the first websites to the internet in 1991. Over the next few years, thousands of pages were created that provided users with an alluring medium that allowed for the transmission of pictures, videos and audio. This effectively opened up the internet to everyday users, ushering in a new era of global communication and knowledge sharing.
Netscape Navigator was one of the First Web Browsers
The web functioned by linking an interconnected system of webpages through a communication protocol known as the HyperText Transfer Protocol (or HTTP). HTTP creates a set of rules that allow individual computers to request and receive information from websites through a schema known as the client-server-database architecture.
HTTP Allows Individual Computers to Talk to Websites
As the name suggests, there are three key players in this system:
Clients: Clients are individually owned devices, such as personal computers, laptops, tablets or smart phones. Although they do have limited computing power, their primary function is to receive data and present it in a graphically pleasing format to the user (such as a website). Most websites are viewed through browsers (e.g. Google Chrome, Firefox or Safari) which are responsible for sending data requests to servers (and also responsible for receiving the data that is sent back).
Servers: Servers are large computers that have two primary functions: 1) they route data from client requests to the applicable database (and back again) and 2) they perform the complex logical operations that determine what data to show you on YouTube or Facebook.
Databases: Databases store data, which can be anything from photos on Facebook, to credit card number, to health records, to bank account information, to your personal shopping history on Amazon.
So when you want to access a website: your computer sends a request to a server to get information, the server forwards that request to a database, the database gathers the applicable content (e.g. text, videos, photos, comments, posts, tags, likes, etc..) and sends it back to the server, the server transfers it to your browser, and then your browser organizes everything into a visually pleasing format on your device. While this may seem complicated, it frequently happens in a fraction of a second (often literally at the speed of light).
Although revolutionary, the major problem with Web 1.0 was that the pages were “static” – like a newspaper or magazine, users could do little more than passively read what was displayed on the site.
Web 2.0
The next major innovation in the web occurred in the early 2000s with the introduction of interactive webpages.
These sites provided a richer experience, allowed users to interact through social media and encouraged user-generated content. Popular Web 2.0 sites include social networks (Facebook), video sharing sites (YouTube), blogs (Medium), wikis (Wikipedia), microblogging sites (Twitter), and web applications (Google Docs).
Web 2.0 – the “Interactive Web” – Evolved in the Early 2000s
This new breed of website required a lot more storage and computing power to be successful and, as a result, we soon started to see the leaders in each of these categories – such as Facebook for social networking, Amazon for e-commerce, and Google’s YouTube for user-generated video – leverage economies of scale to break away from the pack and grab extraordinary market share.
Indeed, today it is estimated that four companies – Amazon, Microsoft, Google and Alibaba – own 67% of all major cloud servers and databases, and they hold many of them in a handful of locations known as hyperscale data centers (multi-hectare facilities designed to host thousands of “room-size” computers).
Map of Microsoft, Amazon and Google’s Data Centers
So in reality, the modern internet isn’t all that “global” as most of it is effectively stored in a few dozen locations owned by a small handful of companies.
Given that our modern economy runs off of data – we produce 28 trillion bytes every second – this should be a major cause for concern…
Web3
The next version of the internet will likely upend this structure. Instead of hosting most of the world’s data and computing power in centralized data centers, Web3 intends to “cut out the middleman” with two recent inventions:
Blockchains – decentralized databases which can replace traditional databases
Smart contracts – computer programs that can replace centralized servers
When combined, these two technologies are often referred to as “smart contract platforms” (for a much deeper dive on how smart contract platforms work, feel free to visit my writeup here: “The Complete Beginner's Guide to Smart Contract Platforms”)
This is revolutionary – for the first time in history, smart contract platforms give users full ownership and control of their data, content and assets. This means that no one can censor users, seize their assets, block their access, charge them outrageous prices for selling goods online or monetize their data without permission.
To borrow a phrase used by Messari’s Eshita Nandini – if Web 1.0 was the “read-only” web, and Web 2.0 was the “read-write” web, then Web3 is the “read-write-own” web.
Web3 Gives Users Full Ownership and Control of their Data, Content and Assets
While the use of smart contract platforms is groundbreaking, they are not enough on their own to create truly a decentralized internet as they: i) need additional pieces of infrastructure such as wallets and node providers, ii) require the replacement of the traditional “wires” of the internet with a decentralized alternative and iii) still need databases, albeit in a slightly different way.
Although we are probably still some time off from realizing the vision of a fully decentralized web, we’ve made a lot of headway and are starting to get a sense of what the final product may shape up to look like:
Key Components of Web3 Infrastructure
Although the user experience of a decentralized internet will likely stay more or less the same (i.e. users will still visit a website, click a few buttons and get the data they want), what’s going on in the background will be very different. In the next version of the internet, when a user wants to access data, she will likely follow the below roadmap:
Browser: The first step in the user journey will likely remain largely the same, with consumers accessing the internet through a browser (technically, we may all soon access it through virtual or augmented reality devices, but we’ll get to that in a second)
Wallet: Perhaps the biggest noticeable change for the user will be the addition of a digital wallet, which will replace emails and passwords as the primary means to sign into a website
Decentralized Internet: Once signed in, information could travel through the network over a decentralized internet service provider (ISP) such as Helium
Node Providers: In order to access a smart contract platform, users need to run a “node”. We’ll define what that means in a bit, but the key takeaway here is that running a node is challenging and, as such, most users will rely on third-party services known as node providers
Smart Contract Platforms: Smart contract platforms such as Ethereum will replace traditional servers and databases
Data Storage: There will still be a need for databases, but decentralized databases such as IFPS or Arweave will work a bit differently than databases today, connecting directly into the “front-end” and assuming more of a support role
In addition to the above, Web3 will require several tools designed exclusively for blockchains such as decentralized domain name servers, Layer 2 solutions, querying tools, oracles, bridges and decentralized computers.
In the interest of clarity, we won’t expand on these here but will instead dive deeper into them in the next section… 👉
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