Why Web3.0 Blockchain Technology Is Powering a $6 Trillion Market

Black diagonal chain, a blockchain concept, double
Image: denisismagilov/Adobe Stock

By 2023, the Web3.0 blockchain technology sector will be worth over $6 trillion, according to Market Research Future, and Web3.0 will continue to grow at a CAGR of 44.6% between 2023 and 2030.

Because Web3.0 relies heavily on the blockchain, many mistakenly believe that its fate is inevitably tied to the volatile cryptocurrency market. However, cryptocurrencies are only part of the new sector. Gartner explains that while cryptocurrencies crashed in the first half of 2022, decision makers should not assume that the value of Web3.0 technology is affected. According to the research and consulting firm, Web3.0 technology will soon reach its adoption tipping point and industries from aircraft maintenance to food safety will tokenize their applications.

What drives the growth of Web3.0?

The Web3.0 Blockchain Market research report reveals the commercial, technical, and security reasons driving the growth of Web3.0. While the COVID-19 pandemic devastated industries such as hospitality, automotive, aviation, and retail, IT industry revenues have been steadily increasing. IT also saw new market opportunities as users demanded 5G technology, virtual and augmented reality, blockchain applications, AI and machine learning. These technologies are the pillars on which Web3.0 is built.

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“Blockchain has been a proven technology that has taken cryptocurrency and NFT security to the next level, and now, it is poised to ultimately transform the next generation of web technologies,” Aarti Dhapte, senior research analyst at Market, told TechRepublic. ResearchFuture. “Web3 blockchain will completely transform the existing conventional processes of the different sectors.”

From financial services to retail and e-commerce, media and entertainment, healthcare, IT, government and energy – almost every industry is expected to adopt the Web3.0 blockchain.

Senior executives and decision makers see potential in the highly transparent nature of a decentralized Web 3.0, where all transactions are logged and recorded and can be easily traced. On the other hand, developers and IT teams invest in Web3.0 due to its rapidly developing technology strengths.

The benefits of the blockchain are attractive. It improves customer adoption by being easily accessible to anyone, its costs are extremely low, and its speed far exceeds that of traditional centralized operations. The cybersecurity industry also praises decentralized networks for being more secure, since in order to breach a blockchain operation, an attacker must synchronize multiple attacks at once. Blockchain is also being integrated with IoT for logistics, supply chains, and factory line operations, attracting the industrial sector.

“Web 3.0 has helped change the way humans and machines interact and enables data transfer, cryptocurrency-based payments, and easy transfer of ownership,” the report says.

Leading companies driving the growth of Web3.0 include Binance, Polkadot (Web3 Foundation), Helium Systems Inc., Decentraland, Alchemy Insights, and Antier Solutions.

The weight of the financial world in Web3.0

One of the biggest drivers of Web3.0 blockchain technology is the banking, financial services, and insurance industry. As new technology is expected to revolutionize traditional financial systems, the weight of the global economy is pushing Web3.0 into a new era.

“Decentralized finance will play a much bigger role than it does now,” Dhapte said.

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The unique features of a decentralized network will also increase security. For example, the insurance industry will see reduced fraud, and insurance buyers can expect premium prices to drop as processes become more secure and error-free. Similarly, all digital financial sectors will benefit. Governments are also considering the use of blockchain to store land records, for electoral digital voting systems, supply chains, and military and defense applications.

User-Centric: What is Web 3.0 Blockchain Technology?

The concept of Web3.0 implies data ownership and decentralized control. The first version of the Internet, Web1.0, was based solely on content produced by governments, organizations, and businesses. This website was primarily information-oriented and slowly but gradually changed to a consumer-driven space. Few users of this web version were content creators.

Forbes explains that with Web 2.0, users became creators and turned to social media, blogs, and websites. However, they relied on centralized web services owned mostly by big tech companies. Content creation became a business that required audience building, and advertising became the main revenue stream for web technology companies.

Dhapte explains that the appeal of Web3 is that instead of accessing the Internet through services mediated by companies like Google, Apple or Facebook, people own and govern sections of the Internet. Unlike the data, content or art that is hosted on the traditional internet, in Web3.0 when the content is verified through the blockchain it has a creator, an owner and a value.

Decentralized infrastructure and application platforms will displace centralized tech giants, and people will be able to legitimately own their data.

The Internet has always been about connecting users, and billions are expected to actively use Web3.0 technology on decentralized social media platforms.

“Content creators in a decentralized social media equivalent can retain more control of their digital identity while also being rewarded for the activity and value they create on the network,” Dhapte said.

Different industries, different blockchain applications

E-commerce and the retail sector are expected to be the massive end users of this new technology. They will benefit from more secure transactions, new apps and services, and new ways to buy and sell. Blockchain is also being presented as a solution to privacy issues, a big trend among global users who no longer want to give their personal data to big tech companies.

Other industries are using blockchain in different ways. For example, healthcare is reinventing the storage and management of electronic medical records.

“Currently, patient records exist in large, siled, centralized IT systems, making it incredibly difficult to share data between different healthcare teams and services,” explained Dhapte.

The risk of storing sensitive patient data in centralized systems, where it only takes one breach attack for it to be compromised, contrasts sharply with the security benefits that decentralized networks can provide.

“Blockchain will enable the sharing of accurate data between health care providers, which simply means diagnostic accuracy and increased treatment effectiveness,” Dhapte said.

In the pharmaceutical industry, the Web3.0 blockchain is poised to deliver more efficiency in supply chains, transform data management in clinical trials, and quality management in the pharmaceutical sector. Supply chain management, IoT, and other digital systems that operate with multiple endpoints can be more resilient to disruption when managed through decentralized networks.

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Web3.0 Challenges: Power and Regulations

The blockchain has been criticized for its massive use of energy. Bitcoin is estimated to use 707 kilowatt-hours of electricity per transaction. Although this consumption is significantly higher than other digital and centralized transactions, the problem of crypto energy has become a global concern.

Projects like Bitcoin Green, which use highly efficient proof-of-stake consensus and renewable energy sources, have emerged as a solution. These are part of a movement to build a free, equitable and carbon-neutral blockchain, as TechRepublic reported in July.

But Dhapte cautions that much remains to be done to address this challenge.

“The reality is that there is not enough renewable energy production to cover all activities, and if miners switch entirely to renewable sources, there will be an excessive burden on non-renewables,” he said.

Another challenge with no immediate resolution in sight is blockchain regulation. The global legal landscape for blockchain is complex, diverse, and often confusing or completely non-existent. Should top executives worry about regulations?

According to Dhapte, they shouldn’t. Dhapte explains that coins may be banned in some countries, but blockchain technology is not. Around 40 countries have completely banned or restricted the use of cryptocurrencies, including China, Egypt, Qatar, Kuwait, and Vietnam.

“This ban will not have much effect on the developments in the Web3.0 blockchain market as other major countries are actively promoting and supporting the next Web3.0 era,” Dhapte said.

China may have banned cryptocurrencies, but they still use blockchain technology to build a stronger economy. By 2020, the Asian country had approved more than 220 blockchain projects and was accelerating the launch of the digital Yuan, International Finance reported.

“Other countries where digital currencies are banned will also want to use the true potential of Web3 technology,” adds Dhapte.

Web3.0 Innovations: What Leaders Need to Consider

The Web3.0 developer industry is hitting an all-time high, with 2021 marking historic growth for Web3.0 development. Given the maturing Web3 ecosystem, industry experts believe that the requirement for Web3 developers will continue to grow over time.

In cybersecurity and app development, a big advance is bounty programs, often run by ethical hackers grouped in organizations like HackerOne.

“In addition to discovering new talent and solutions, online challenges are also a great way to find blockchain developers who can help catch bugs and develop Web3.0 code by participating in bounties,” explained Dhapte.

Web3.0 developers are rewarded with cryptocurrency tokens for completing a bounty. This is a good way for vendors who don’t have developers on their team, or who don’t want to allocate additional resources, but need to fix bugs in their existing or future Web3.0 applications.

From the widespread adoption of NFTs and crypto to the proliferation of decentralized autonomous organizations and blockchain-based infrastructure and storage, rapid Web3.0 innovations are happening across the board.

According to the report, IT leaders, decision makers, and executives should look at the metaverse, the decentralized application industry, AI, gaming, and machine learning. These technologies will further accelerate the growth of Web3.0.

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