By Pete Harris, Executive Director, Austin Blockchain Collective
It’s too late for 2020 predictions so here is one for the decade ahead … read this blog to the very end …
Web 3.0 describes the next phase of the internet where control and privacy, and hence power, will be restored back to individuals and away from big tech companies that millions of people and businesses have come to rely on (to their benefit for sure, but at potentially great cost).
Blockchain technology — specifically public blockchain — is a key enabler of Web 3.0. So too is decentralized storage and query mechanisms, decentralized telecommunications, tools to build decentralized applications. And integration gateways with other public blockchains, private blockchains and non-blockchain applications and databases.
The Web 3.0 term was coined in 2014 by Gavin Wood, a Brit computer scientist who was the first CTO of Ethereum. He went on to found Parity Technologies and the Web3 Foundation, which is now rolling out its first public blockchain projects, known as Substrate and Polkadot.
Flash back: It was February 10, 2016 when I hosted The Blockchain Conference. Over the previous couple of years I had attended a few bitcoin-come-blockchain events that suffered from poor focus and amateur organization and (given my background producing fintech events) I knew I could do better because the business world deserved it.
The Blockchain Conference at the Mission Bay Conference Center in San Francisco was my first foray into the blockchain event space for the business community — and I was lucky to have IBM’s John Wolpert presenting the keynote. The timing could not have been better. Just the day before, the Linux Foundation had announced that IBM was a founding member of its Hyperledger blockchain initiative and John was IBM’s first Global Blockchain Offering Director. To be honest, he didn’t give a lot of detail about Big Blue’s plans, but he did set out the company’s intentions. A year later, it introduced its Hyperledger Fabric-based IBM Blockchain cloud service, which has arguably become the private blockchain platform of choice for business enterprises.
[As an aside, other presenters at the conference included: Jae Kwon, Founder and CEO of Tendermint, which now underpins the decentralized Cosmos platform; Bruce Pon, who was launching his towards-decentralized BigchainDB, and who since created the Ocean Protocol; and Sergey Nazarov, who discussed his new smart contracts oracle startup, now going from strength to strength as ChainLink.]
At the end of 2017, John quit IBM and joined ConsenSys, the Brooklyn-based Ethereum powerhouse. I wasn’t that surprised since I knew that he was at heart an entrepreneur but I expected John to focus mainly on rolling out private Ethereum networks for its enterprise customers.
He may indeed have been doing some of that. But publicly John has become a proponent of public blockchains for business uses, Ethereum in particular. Within the world of Ethereum he is not the only one championing the public Ethereum ‘Mainnet’ as the way forward, even though it needs a substantial technical upgrade to make it fit for purpose for that role. What’s clear is that there is now a real common purpose and commitment from key stakeholders across the Ethereum space to do the work required to make the platform business ready.
One of those stakeholders is top management consulting firm Ernst & Young. Its global blockchain head Paul Brody (another former IBMer) reckons that the current technical shortcomings of public blockchains can be solved in the soon-to-be future, and that the associated challenges outweigh drawbacks of private blockchains, such as the difficulty in recruiting members to join them. That’s a fundamental obstacle given that decentralized governance and consensus are key design elements for blockchains. The more centralized a blockchain is, the more reason there is to simply use a database instead.
Among other contributions that EY (as it likes to be known) has made to the Ethereum community is Nightfall, a privacy mechanism that leverages zero knowledge proofs. Read about it in this great article from Ben Jessel.
The POV of Brody, Wolpert and the Ethereum community is clearly gaining some traction. Recent research commissioned by EY and conducted by analyst firm Forrester Research found that 75% of enterprise businesses expected public blockchains to be in their future. Indeed Forrester Principal Analyst Martha Bennett suggests in her 2020 distributed ledger predictions that “the public vs. private/permissioned blockchain debate will reach executive teams.”
While it has much mindshare and significant backers, Ethereum is not the only player in the world of Web 3.0. Far from it. As well as platforms like Polkadot, Cosmos, Kadena and Near, there are other components that form what Austin’s Multicoin Capital term the ‘Web3 Stack’. It recently updated its vision for that stack in this excellent research essay.
So my prediction for the decade is: “Web 3.0 platforms will emerge to become technically credible options for at least certain business applications. The key challenge for existing businesses will be how to leverage Web 3.0 and not be bypassed by it.” I have added a calendar item for January 2030 to check back on whether I am right. If I am not, I won’t be alone.
About the Author
Pete Harris is Principal of Lighthouse Partners. He has 40+ years of business and technology experience, focusing in recent years on business applications of blockchain and distributed ledger technologies.