Web3

Concept#

Web History#

Decentralized#

Take Discord and Matrix as an example. Matrix is the decentralized alternative of Discord. Data are stored decentralized among different users. A use can choose which server to store their data, but the hosting server can access the data. With Discord, you have no choice. One of the downside of using decentralized service is poorer network performance, less efficiency.

Blockchain#

Blockchain is a distributed, trustless, transparent, append-only database. A block has it’s own data, hash and previous block hash. A hash is derived from it’s data. Once a block is appended, it cannot be edit or deleted. A full node in the network keeps a copy of the entire blockchain. The data lives across many computers in the network for validation, all full node have to verifies the blockchain.

Bitcoin creates a block every 10 minute to slowdown the transaction for security.

Smart Contract#

Once a smart contract is created, it can’t be changed and the code lives forever on the chain. It ensure the creation and validation of blocks in a blockchain.

Wallet#

Crypto wallet stores your private and public (address) keys. When you do a cryptocurrency transaction, you digitally sign a transaction using your private key in the blockchain records, and every full node verifies the signature.

Hot wallets like MetaMask are always connected to the internet, suitable for daily use. Cold wallets are offline, safer but inconvenient, suitable for long-term use.

Decentralized App#

dApp includes interaction with a blockchain smart contracts, validators, wallets, and users through frontend UI.

Mining#

Use of computing power to validate and create new blocks.

In BitCoin, Proof of Work is done by a miner that calculates a hard math problem through brute-force method to get a rare for a new block. The reward of transaction fee and newly minted bitcoin of 3.125 BTC as of now is paid to the miner and halves roughly every 4 years.

The worth of BTC is floating around $60000 USD per BTC as of today (5/10/2025).

Non-Fungible Tokens#

NFT (Non-Fungible Tokens) are unique token that represent ownership of a digital item and lives on a blockchain. They are not tradeable, but can be transferred. They are commonly used in games, art, music, certificate, membership and many more as a reliable proof.

Decentralized Autonomous Organization#

DAO (Decentralized Autonomous Organization) is a smart-contract-powered organization with rules and governance encoded into code. No manager, just token holders who vote. Treasury is managed by proposals and on-chain voting.