Web 3.0 — The Convergence of AI, Decentralization, and Social Dynamics

This article was written by chatGPT from rough notes.

Over the past 6–7 years, my keen interest has revolved around AI, decentralization, and the social aspects that underlie various products. Through active observation, I am increasingly confident that the convergence of these three elements will pave the way for the evolution of the next generation of the internet — commonly referred to as Web 3.0.

In any industry disruption, two key components come into play: how value is created and how that value is distributed. Often, a successful disruption involves both new value creation and novel distribution channels, resulting in product-market fit and exponential growth.

While the current internet ecosystem is in a quasi-stable state, it is ripe for disruption. Numerous attempts at disruption have been made, but the majority of these solutions lack sufficient value or effective distribution mechanisms to truly revolutionize the ecosystem.

Let’s delve into the present ecosystem and examine how AI, Social, and Decentralization contribute to value creation and distribution today.

AI:

AI’s role in value distribution is evident, particularly in the past two decades. Algorithms designed to curate content for specific audiences have become pivotal, from search engines to content platforms.

Value creation through AI has evolved with the advent of generative AI. This technology has captured widespread imagination, especially in augmenting human efforts in content creation. However, challenges remain, as generative AI’s customization to specific use cases is limited, and reliance on central agencies for algorithm updates persists.

Social Dynamics:

Social media exemplifies how individuals can create substantial value through the right platforms. Beyond these platforms, the broader audience plays a vital role in generating core content. While search engines provide results, the underlying content is often contributed by a distributed community.

The impact of influencers on various decisions, from purchasing items to planning trips, has grown significantly. User reviews have influenced choices for over a decade, revealing the sway of social dynamics on value distribution.

Decentralization:

The origins of the internet were marked by decentralization, with connections forming between individuals. Protocols like torrents and FTP enabled content access without reliance on centralized entities. The resurgence of Direct-to-Consumer (D2C) models has allowed brands to go independent of centralized platforms like Amazon.

Blockchain has recently led to new innovations in how value can be better distributed across a large network of users. Making a lot of new business models now possible.

Why isn’t Web 3.0 here yet?

Despite the promise of this convergence, its transformative impact has been slower to materialize. AI’s accessibility was constrained by data requirements, favoring large corporations. Generative AI broadened accessibility, but challenges remain, like tailoring AI to specific cases. Similarly, while social platforms empower users, their control over consumed content raises concerns.

Decentralization, despite being present for a decade, hasn’t revolutionized the internet as anticipated. It has restricted accessibility, hasn’t substantially transformed value creation. The value gained from decentralized platforms often pales in comparison to centralized counterparts.

Envisioning Web 3.0: Overcoming Challenges

Creating Web 3.0 necessitates an approach beyond replicating Web 2.0 in a decentralized manner. To succeed, we must target the 20% of use cases where the current model falls short, instead of vying for the remaining 80%.

In the search engine realm, Google’s dominance remains unchallenged due to its vast database. GPT-3-based alternatives offer promise but can be absorbed or outcompeted. Focusing on niches where traditional search engines falter is key. For ex: medical advisory as a use case.