The Web3 movement is not an established community. It is a loose association of people and groups with very different motivations and beliefs. There are certain ideal overlaps that form the basis of the technical architecture and implementation. The ideal nucleus of the Web3 movement is formed by the following values, which the Web3 approach tries to maximize as much as possible:
- decentralized finance(DeFi)
- no restrictions
Decentralization is intended to ensure that monopolies are not able to develop– as is the case on the current web . There is no state interference an intervention.
Transparency is the basis for digital coexistence on Web3. All relevant information about artefact transactions must be transparent and controllable for all participants in order to enable trust in the overall system: Fraud should also be impossible because it cannot be hidden.
Freedom from restrictions means the negative freedom of individuals from censorship or control by others, in particular states or, for example, platform operators.
Due to the heterogeneity of the Web3 movement, not all of these values are equally important to everyone in the field, but they describe quite well the mental framework from which the problems of the Web are to be solved and which integrally influence technical designs.
Web3, sometimes called the “distributed web” or the “decentralized web”, is a primarily blockchain-based backend and infrastructure layer that builds on existing network technologies and aims to transform the Internet in a radically decentralized and ownership-individualized way .
Decentralized finance (DeFi) is a future financial technology having different and secure ledgers as compare to present system of finance. In this system, there are no banks and other financial institutions and presently , it is used in cryptocurrencies. The system removes the control banks and institutions have on money, financial products, and financial services. Image source- Pexels
But why is blockchain poised to give the real estate industry such a significant leg up? First and foremost, by leveraging Distributed Ledger Technology (DLT), increases trust, transparency and Blockchain also speedup contract processes, saves time and reduces costs. Image source- Pexels
A fungible item is one that can be replaced by an identical item while a non-fungible item, on the other hand, is unique and can’t be copied or substituted. The Statue of Liberty, the Mona Lisa, and a ticket for a seat at the Super Bowl are all non-fungible items. Rare Arts which can’t be copied and are created through smart contract, is a computer program stored on the blockchain that runs when certain conditions are met. This means that every time the NFT is sold, a percentage of that sale is sent to the original creator’s wallet. This a concept called provenance, Image Source _pixabay
Blockchain participants are rewarded with cryptocurrency rewards awarded for mining a block or including transactions. As a side effect, this means that operations on the Ethereum blockchain in particular are unusually expensive: For example, a simple transfer of ether from one account to another account in a phase of moderate use of the chain can incur fees worth three-digit euro amounts. A blockchain is a set of blocks tied together by chain. These blocks are called nodes of computer networks and the information is stored digitally. The best and practical use of blockchains are in cryptocurrency systems. It was used in Bitcoin to maintain a safe and secure decentralized data. It is not controlled by one but a shared network .A blockchain consists of essentially three concepts blocks, nodes, and miners.
Immutable cash books and smart contract
In the Web3, blockchains , the records are stored in unchangeable ledgers and are called decentralized cash books . Everything on Web3 is based on the idea of accounts and transactions, because within this model ownership and trading of the digital artefacts can be mapped fairly easily. But even if Web3 uses the native cryptocurrencies of the widespread blockchains – above all, of course, Ethereum’s ether – as a currency, it’s about much more than just digital money.
At the heart of the Web3’s function, on which the hope for a better web rests, is the idea of the “smart contract”. Smart contracts were popularized by the Ethereum blockchain, but can now be found in all modern blockchains. The idea is that a program can be written directly into a blockchain, which will then be executed under certain conditions – a bit like a drilled version of database triggers in classic databases.
All blockchains basically come with a built-in smart contract that defines the cryptocurrency of the blockchain. For example, you could use smart contracts to implement a type of transfer that only works if both the sender and the recipient agree. But it goes much further than that.
Smart contracts can create their own digital artifacts, commonly called “tokens”. A contract is then responsible for managing the tokens that it generates and, for example, defines the rules according to which the tokens can be transferred. For example, a typical scenario is that the person running the smart contract not only earns on the first sale of a token, but collects a percentage of each resale. This rule is then firmly stored in the code and cannot be changed by an agreement between the trading partners: The associated mantra is “Code is law” and is intended to mean that the rules of the contract are final and incontestable. There should be no corrective measures such as a jurisdiction that can declare clauses or entire contracts invalid.