A simple guide to the Web3 stack

2 years ago

Web3 is the latest buzzword to spot an uptick successful involvement successful caller months — What does it really mean?

Around the Block from Coinbase Ventures sheds airy connected cardinal trends successful crypto. Written by Connor Dempsey, Angie Wang & Justin Mart.

A batch of definitions person been thrown around, but astatine Coinbase, we mostly deliberation of Web3 arsenic a trustless, permissionless, and decentralized net that leverages blockchain technology.

Web3’s defining diagnostic is ownership. Whereas the archetypal iteration of the commercialized net (Web1) was read-only for astir users, and Web2 allowed users to some read & constitute on centralized platforms (Twitter, Facebook, YouTube, etc), Web3 gives users afloat ownership implicit their content, data, and assets via blockchains. It empowers users to read-write-own.

Where a 3rd enactment similar Facebook owns your individuality and information successful Web2, your individuality successful Web3 tin determination fluidly betwixt platforms without your information being captured and monetized by work providers. While Web2 apps are centrally controlled, tokens successful Web3 assistance users the close to assistance govern the services they use, representing a signifier of ownership successful the platforms themselves.

With that framing successful mind, what does the Web3 stack look like?

The Web3 stack is inactive nascent and fragmented, but with overmuch innovation implicit the years, it’s opening to travel into focus. What follows is not a mutually exclusive nor wholly exhaustive laic of the land. Rather, it’s a model for reasoning astir this scenery arsenic it continues to evolve.

Let’s commencement from the bottommost up.

Protocol Layer

At the bottommost of the stack, we person the protocol layer. This is made up of the underlying blockchain architecture connected apical of which everything other gets built.

Bitcoin is the granddaddy of them all, and portion it doesn’t play a large relation successful Web3 today, it pioneered the quality for idiosyncratic to ain a scarce integer plus done the usage of public-private cardinal cryptography. Following Bitcoin, came a scope of furniture 1 astute declaration platforms similar Ethereum, Solana, Avalanche, Cosmos, etc, that service arsenic the instauration for galore of the Web3 applications presently successful production.

Bitcoin and Ethereum each person further protocols built connected apical of them. Bitcoin has networks similar the Lightning Network (for accelerated and inexpensive payments) and Stacks (for astute contracts), among others. To alleviate its capableness limitations, aggregate layer 2 scaling protocols person been built connected apical of Ethereum.

With the emergence of galore furniture 1 and furniture 2 networks came the request to span worth betwixt them. Enter cross-chain bridges that service arsenic highways that fto users determination worth from 1 concatenation to different (useful cross-chain dashboards tin beryllium recovered here and here).

Infrastructure / Category Primitives

The infrastructure furniture sits connected apical of the protocol furniture and is composed of interoperable gathering blocks (what we’re calling “category primitives”) that are highly reliable astatine doing a circumstantial task.

This is simply a dense and divers layer, with projects gathering everything from astute declaration auditing software, information storage, connection protocols, information analytics platforms, DAO governance tooling, individuality solutions, fiscal primitives, and more.

For example, Uniswap enables the swapping of 1 plus for another. Arweave enables information to beryllium stored successful a decentralized manner. ENS domain names tin service arsenic a user’s individuality successful the satellite of Web3. A idiosyncratic can’t bash overmuch with each standalone application. However, erstwhile combined, these class primitives enactment similar lego bricks that a Web3 developer tin usage to conception an app.

Use Case Layer

Atop the protocol and infrastructure layers beryllium the usage lawsuit layer, wherever it each comes together.

Take a blockchain based crippled similar Axie Infinity, which uses Ethereum tokens and NFTs that tin beryllium bridged to a low-cost/high throughput sidechain called Ronin. Players often usage Uniswap to swap ETH for the tokens needed to play the game. Similarly, decentralized blogging level Mirror uses the retention protocol Arweave to store data. Meanwhile, it leverages Ethereum to fto publishers get paid successful crypto, often by directing tokens to their ENS address.

You’ll announcement that Uniswap appears some successful our infrastructure and usage lawsuit sections. This is because, portion astatine its halfway Uniswap is simply a bid of astute contracts, it besides provides a frontend that users tin interact with directly. Put differently, it simultaneously serves arsenic a standalone user-facing app arsenic good arsenic infrastructure for different Web3 apps similar Axie Infinity.

Access Layer

At the tippy apical of the stack sits the entree furniture — applications that service arsenic the introduction constituent for each mode of Web3 activities.

Want to play Axie Infinity oregon get paid for your contented connected Mirror? First happening you’ll request is simply a wallet, which serves arsenic the main constituent of introduction for astir Web3 applications. Fiat onramps similar Moonpay, Wyre, oregon exchanges similar Coinbase assistance users commercialized their fiat wealth for crypto successful bid to get started.

With immoderate crypto successful a wallet, users tin caput to an aggregator similar DappRadar to browse done and link to each kinds of Web3 applications successful 1 place. Other projects similar Rabbithole assistance users observe and larn however to usage assorted Web3 applications. There are besides aggregators similar Zapper, Zerion, and Debank that assistance users way each of their activities and assets crossed assorted apps.

Lastly, we’re adjacent to a aboriginal successful which Web2 platforms wherever cryptonative communities already gather, similar Reddit and Twitter, service arsenic an introduction constituent for Web3. Reddit’s long-awaited crypto inaugural volition fto definite communities tokenize, rewarding users with tokens and apt NFTs for progressive participation. Twitter already boasts an integration with Bitcoin’s Lightning Network to fto users extremity others successful BTC.

The ever-evolving stack

The protocols, infrastructure, idiosyncratic applications, and entree points named supra marque up the nascent, yet evolving satellite of Web3: an net owned by its users. Beyond ownership, the powerfulness of Web3 lies successful its modularity and interoperability. Essentially, this means that determination are endless ways that the supra stack tin beryllium combined to make caller and absorbing usage cases — a diagnostic that we expect volition pb to a Cambrian detonation of new, world-changing applications.

While the model and layers we highlighted volition apt enactment unchanged, we expect the projects and opportunities wrong them to germinate dramatically successful the coming years.

Web3 Reads

A thoughtful critique connected Web3, by Moxie Marlinspike
A rebuttal to Moxie, from Vitalik Buterin
Are we doomed to repetition web2 history? by Sarah Guo
The Architecture of a Web 3.0 application, by Preethi Kasireddy
Web3 successful a nutshell, by Eshita
The Web3 World, by Grace Isford
The Web3 Renaissance: a Golden Age for Content, by Li Jin & Katie Parrott

Web3 Tweets

What is Web3, from Luke Youngblood
A usher to making the leap from Web2 to Web3, from obheda12
The lone web3 stack that volition past the trial of time, from The Graph
Why everyone volition request Web3, from Balaji Srinivasan
What is Web3? from Dan Khomenko

Previous editions of Around The Block

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