Before getting to the main point, there are two small questions: Do you remember when the use of dial-up Internet access started during the time when the Internet entered the mass market? How much time did it take to download a two-hour movie at that time’s Internet speed?
Even though it feels like dial-up Internet access is something of the past, it is only about 30 years since its introduction. If we were using the Internet speed at that time downloading. It would take decades to download a 2-hour movie of average picture quality. Today, we generally refer to this period of Internet development as the Web1.0 era. Looking back on the past 30 years, we cannot help but be shocked at the rapid development of the Internet industry and its deep impact on the real world. Today, most millennials that are born into households with high-speed Internet probably have never heard of the old “dial-up internet” and are enjoying the convenience as well as the rich and colorful content in Web2.0 directly. Moreover, they are also involved in the exploration of Web3, albeit unknowingly.
We are now moving on to the main point. Recently, we have noticed that Andreessen Horowitz (a16z), a well-known venture capital company in the crypto industry, has officially issued its own recommendations for Web3 regulation, offering the following ten suggestions to “world leaders,” including governments, multinational companies, and globally influential civil society groups.
1. Establish a clear vision to foster decentralized digital infrastructure; 2. Embrace multi-stakeholder approaches to governance and regulation; 3. Create targeted, risk-calibrated oversight regimes for different web3 activities; 4. Foster innovation with composability, open-source code, and the power of open communities; 5. Broaden access to the economic benefits of the innovation economy; 6. Unlock the potential of DAOs; 7. Deploy web3 to further sustainability goals. 8. Embrace the role of well-regulated stablecoins in financial inclusion and innovation; 9. Collaborate with other nations to harmonize standards and regulatory frameworks; 10. Provide clear, fair tax rules for the reporting of digital assets, and leverage technical solutions for tax compliance
In fact, not only a16z but also many well-known crypto companies, including MEXC Global, Coinbase, FTX, and Binance, have put forward their own regulatory visions. Take MEXC Global, for example. Although it is less than four years old, it has already obtained the compliance licenses of five countries, including the United States, Canada, Australia, and so on. MEXC Global has also developed into a leading global compliance trading platform by providing in-depth public chain ecosystem projects such as Ethereum, Polkadot, Solana, and conceptual projects such as DeFi, NFT, Web3, Metacosmic, GameFi, DAO.
From the recent ten suggestions put forward by a16z and the in-depth projects of MEXC Global, we can’t help but ask: After the DeFi Summer in 2020, the NFT+ Chain Game boom in 2021, why will Web3 also become an industry hotspot alongside the metaverse in 2022? To answer this question, let’s look for an answer from the development of the Internet.
Although there is no consensus on the definition of Web3 in the industry at present, generally speaking, it is the typical name for the third generation of the Internet. A general understanding is that it will be a new generation of the Internet that is more user-friendly, safer, more private, and with more value realization. So, this means that Web3 is not only the latest step in Internet technology but also the first step towards a virtual world for human civilization.
If you divide the evolution of the Internet into several stages, the first stage is Web10, which probably lasts from the day the Internet was born to the first half of the first decade of the 21st century.
In this period, from the perspective of low-level technology, most of them use the mode of technology innovation to promote business development. The change and use of information technology have played a decisive role in the growth and development of websites. However, from the perspective of user experience, it shows a clear unidirectional feature. Early Internet companies provided platforms and content for people to read, but there was little interaction. Users could only get information from websites in one direction, and only a few content creators could edit and create content. Generally speaking, this is a typical PGC era. In a more vivid analogy, the Web 1.0 model is like moving a library over the web, where users are more likely to be consumers in the sellers’ market and do not have much or even zero bargaining rights. Moreover, both in terms of the number of websites and data transmission speed, they are in a very primitive stage.
The second stage is Web2.0. In 2004, at a brainstorming session between O’Reilly and MediaLive International, the world’s leading publisher, the concept of Web2.0 was first introduced. Thus, from around 2004 until now, the Internet has been at the Web2.0 phase.
After nearly 20 years of development, we can clearly see that compared to the Web1.0 era, the Internet has undergone a fairly comprehensive upgrade of concepts and ideological systems. While the underlying technologies have continued to iterate and progress during this period, they have moved from a decisive position to a supportive position in driving Web2.0 forward, replacing it with the idea of respecting “personal values.” This concept is reflected in the rapid progress of interactive experience in the Web2.0 era. Gradually from the original top-down Internet system dominated by a few resource controllers to a bottom-up Internet system dominated by the collective wisdom and strength of a broad number of users.
However, from the point of view of respecting the concept of “individual value,” Web 2.0 is just a good starting point. Generally speaking, Web 2.0 provides every user with equal channels to express their views, links everyone together, and makes the flow of information and the amount of information increase exponentially. But at the same time, we should also see that the price behind this is largely at the expense of user privacy and the value of consumer information.
In other words, Web 2.0 is more like a transitional stage for Internet enterprises to further obtain more commercial benefits by transferring part of the participation rights to users. With the development of Web 2.0 in the past 20 years, user data has become the most important asset of each company. However, the owner of this portion of assets, which are the users, do not have any control. From this perspective, there is still great room for improvement in respect to individuals. Therefore, it has become an opportunity for Web3.0 to deepen the concept of respecting individual values. Leading the future trend of the Internet, pushing the Internet information age to the Internet experience age, and ultimately attributing the rights and interests to the users, will be important problems to be solved by Web3.
It is against this background that a16z put forward the above ten regulatory recommendations on the future development of Web3. In a comprehensive view, it essentially points to the challenges faced by the current crypto industry and the development of Web3. As a16z mentioned in its recommendation, Web3 is not a single project but an overall set of technological advances, including crypto assets, DeFi (Decentralized Finance), blockchains, smart contracts, Token, and DAOs (Decentralized Autonomous Organizations), and so on. Together, these tools enable a new form of human collaboration. They can break many deadlocks in life and help communities make better collective decisions on key issues such as how networks will develop, what behaviors will be allowed, and how economic benefits will be distributed.
When compared to Web2. 0, it looks like Web3.0 is not only an upgrade to the available functions but also extends the development concept of the Internet. When comparing Web2.0 and Web3.0, it’s clear that Web3.0 websites will be more immersive and easy to use, and more importantly, it will maximize the security and privacy of personal user data.
On the other hand, according to a survey conducted by a consulting firm commissioned by a16z, about 45% of the cryptocurrency owners are millennials born between 1980 and 1996. And it is predicted that at least 1 billion new users will be flooded into Web3 in the next five years, most of which will be of new generations born after 1980. Millennials are more optimistic about an investment philosophy that enriches themselves and the world around them, and they are more inclined towards crypto investment opportunities in the market than in the gradual, consolidating real estate and stock markets.
From this point of view, the crypto market versus the Web3 race has become a mental battle for the millennials. That is, whoever can win these young people will get the upper hand. As mentioned above, MEXC Global has been on the globally compliant operation route since 2020. MEXC Global is well-known for its fast and progressive crypto sectors, and in two years, it has reached the top 3 in terms of global trading volume.
Guy Hirsch, USA Managing Director of eToro, has a similar view of this. “The market is seeing the beginning of a generational shift in trust from traditional stock exchanges to crypto exchanges.” Once this transformation process starts, we can turn our stock into a Token based on blockchain technology in the Web3 world for more convenient, safe, and efficient trading. The size of the market will grow hundreds or even thousands of times larger. A new market that may reach billions of dollars may already be on the way.