Abstract

This paper explores Web3, the next phase of internet evolution driven by decentralization and blockchain technology, contrasting it with Web1 and Web2. It examines Web3’s transformative potential in industries such as finance, art, gaming, and governance, with a focus on Decentralized Finance (DeFi), Non-Fungible Tokens (NFTs), Metaverses, and Decentralized Autonomous Organizations (DAOs). While Web3 offers significant promise, it faces challenges like scalability, security, regulatory uncertainty, and user experience issues. The paper also addresses the SEC’s investigation of OpenSea, the largest NFT marketplace, as a critical obstacle for Web3’s future. Finally, it discusses Web3’s trajectory and highlights areas for future research.

Keywords: Web3, Blockchain technology, Decentralized finance, Non-fungible tokens, Metaverses, Decentralized autonomous organizations