I recently watched some of the recent Congressional hearings on cryptocurrency, and, boy, if there’s anything funnier than watching experts try to educate most members of Congress on anything crypto-related, it’s probably me trying to explain it. I don’t own any digital assets, still don’t see the point of NFTs, and am not going to buy any real estate in the metaverse.
Credit: Colin Evran/Protocol Labs
All that being said, there’s something about Web3 that
fascinates me). Knowledgeable people are
talking about Web3 “reinventing the internet,” “democratizing” it, giving
people more ownership of/control over what they do on it. It’s a counterbalance to the how the internet
– both the traffic and the infrastructure -- has increasingly grown dominated
by a few very large firms, such as Google, Facebook, or Amazon.
As the Web3
Foundation declares, Web3 is an internet where:
- Users own their own data, not corporations
- Global digital transactions are secure
- Online exchanges of information and value are
- decentralized
All that sounds very intriguing to me, especially as
someone who has dim views of how healthcare likes to silo information, has placed
too little value on patient ownership of their own data, and is rushing to
centralize.
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Credit: Euromoney Learning 2020
If I’ve got this right, the heart of Web3 is the
concept of distributed ledgers – a.k.a., blockchain. Information is not stored in
one place, controlled by one entity, but across these distributed ledgers. Activity – transactions, changes to the
source information, etc. – updates the blockchain, preserving the history and verifying
the activity across the distributed ledgers. Someone wanting to change or use your
information without your permission faces a large challenge because of its
distributed nature.
On the distributed ledgers, you can do transactions (e.g., buy/sell), use “smart contracts,” participate in social networks, and many other interesting activities. If trying to do anything quickly across a distributed network sounds daunting, Bloomberg reported:
Operating through a distributed network can be clunky, but the user experience is getting better. “It’s still early, but it’s been transformed in the last six months,” says Jonathan Dotan, founding director of the Starling Lab.
To assist, there’s a related concept of a “distributed
app,” which is, I suppose, to Web3 as apps have been to Web 2.0. There’s even a “dapp store” called DappRadar that claims to allow you to “discover,
track & trade everything DeFi, NFI and Gaming.”
We are already seeing DAOs – decentralized autonomous
organizations – to help create /run Web3. “I think DAOs will be as ubiquitous as companies, clubs, nonprofits, and
different kinds of ‘official’ organizations today,” says Maria Shen, a partner
at venture capital firm Electric
Capital told
Bloomberg.
There is an explosion of funding in blockchain-based startups; CB Insights reports $15b in 2021, up 384% from 2020. In The Wall Street Journal, Christopher Mims notes:
Almost every company with “Web3” or “blockchain” in its pitch deck describes its mission as a user-centered quest to empower—and just as often, enrich—its users, making them owners and investors as much as customers.
That. Is. Intriguing.
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Cryptopedia says:
“Tokens — which can also be referred to as crypto tokens — are units of value
that blockchain-based organizations or projects develop on top of existing
blockchain networks.” It goes on to
clarify:
- “Typically, crypto tokens are programmable, permissionless, trustless, and transparent.
- While crypto tokens, like cryptocurrency, can hold value and be exchanged, they can also be designed to represent physical assets or more traditional digital assets, or a certain utility or service.”
Tokens can be used, for example, like “voting shares”
that help govern dapps or other structures.
This leads to something that Mr. Mims also
discussed as one of the “inspired weirdness that is Web3”:
If money can become code,
then money can be way more than a means of exchange; it can also do anything
that other software can do.
This core insight, a sort
of E = mc equivalence between money and software,
is why true believers in Web3 think it could have a huge impact. Suddenly every
activity humans engage in, from buying and selling a house to liking a post on
social media, can be made part of a token-based financial system of a scale and
complexity that makes today’s look like an antique.
I love the “E = mc²
equivalence between money and software;” no wonder people are excited
about Web3.
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Not everyone is a fan. For one thing, generating
some blockchain takes tremendous
computing power, which has a host of environmental impacts. For another, it
can be a way for evading
regulation, which could be a concern for fields like finance or healthcare.
Even more troubling, as Cornell professor
James Grimmelmann told
NPR:
"Web3 is vaporware… It
doesn't make any sense. The vision says
the problem with the internet is too many centralized intermediaries. Instead
of having lots of different applications and sites, we'll put it all on
blockchains, which puts it all in one place.
Web3 has to be bigger than blockchain.
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I don’t know what a Web3 for healthcare would be, but
I have some ideas. Of course, the idea that we own and control our health
records, storing them on blockchain and giving permission for them to be
viewed/added to, should be tempting to anyone who has had to fight or access to
their own records. That’d be a necessary but not sufficient component of a healthcare
Web3.
Imagine, if you will, a future where
anytime you interact with the healthcare system, that interaction is not only
stored in a blockchain record that you control, but also earn tokens for that
interaction. Imagine all the data from
your fitness or other trackers also going into that blockchain record, and
earning more tokens. Image all those tokens giving you voting rights in the
governance of that healthcare system. Credit: Aïda Amer/Axios
We’re not at Web3, and we’re not going to be there Credit: anytime soon. Moreover, experts predict,
it’s less about Web3 supplanting Web 2.0 as becoming incorporated into it. Still, as Esther Crawford, a project manager who is helping
Twitter orient towards Web3, told
NPR: “For a long time, Web3 has
been very theoretical. But now there is a surge of momentum to build." Ignore it at your own risk
I can’t wait to see who is going to
build what Web3 for healthcare.
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