The next World Wide Web with Blockchain

The Internet, despite its vastness, continuously evolved towards centralization ever since its creation 30 years ago. This is how we ended with just a handful of tech giants controlling much of the data running through the global network: Google, Apple, Facebook and Amazon form a true oligopoly collecting unprecedented amounts of data  and turning it into products and services. But a new revolutionary technology promises to change the status quo: it is the blockchain technology with its numerous applications, including smart contracts and cryptocurrencies.

It is for the first time in the history of internet when a new technology vows to completely reverse the trend of centralization. Blockchain is by its nature a decentralized publicly distributed ledger that eliminates the need for intermediaries and the hubs (like tech giants) that are currently thriving due to users’ data and are often responsible for privacy breaches and censorship. Blockchain not only decentralizes the control by giving back to users their own data, but also enables them to monetize their data.

User data probably became the most important “commodity” of the 21st century, generating revenues of hundreds of billions of dollars for tech giants: they offer free services to collect information which they then leverage to become middlemen between businesses and customers. But the increasing awareness regarding the value of user data, combined with an increasing wave of critics regarding privacy breaches (see the recent Cambridge Analytica scandal), created a fertile ground for a new business model to emerge.

Where does blockchain fit into all of this?

The decentralized apps built on the blockchain can remove the necessity for third party, data storing and data analyzing tech companies. And this is not only a dream for the future, it is already starting to happen. Because people were happy to use services like search, email or social networks without having to pay for them, but when they started to realize how much money these service providers are making from their data, they stopped and started to reconsider the situation. As opposition to big tech’s power intensifies, the idea of building a new backbone for the internet is taking hold.

Of course, third-party platforms such as YouTube and Facebook are still incredibly popular and influential, but the decentralized apps based on blockchain are also starting to show their capabilities. Take for example YouTube: competing with it still poses many challenges, but those trying to disrupt it still have one major advantage: the creators create the platform and value. And because the creators’ ability to earn from YouTube advertising is limited and the competition is fierce, it would make sense for at least some of them to move on new blockchain based video platforms, where would be less competition and thus they would get more attention.

A blockchain is made up of two primary components: a decentralized network facilitating and verifying transactions, and the immutable ledger that network maintains. Everyone in the network can see this shared transaction ledger, but there is no single point of failure from which records or digital assets can be hacked or corrupted. Because of that decentralized trust, there’s also no need for an organization (like a tech giant) that serves as a gatekeepers and controls the data. With blockchain, people can possess unique and immutable identities. Thus, they can capture their own data and monetize them, while protecting their privacy.
Google, for example, dominates the global searches with a 77% market share, mainly helped by the network effects of big data. For long time, worries regarding the role played by tech giants, especially as it relates to selling users’ personal data, found no solution. It is not the case anymore: now it is clear that a blockchain based browser/search engine could solve the problem of misaligned incentives. Such a search engine could use data and user preferences, without ever owning them, to display better search results. And users would benefit from advertising, too: they would earn tokenized fees in exchange for seeing the ads, thus removing the unbalanced relationship that exists today between consumers and tech giants.

More and more of our daily activities are now carried out digitally. And there is no better example than e-commerce, which is grabbing a larger and larger piece of the traditional retail. The problem here is also the centralization: For example, Amazon, the most monopolistic and well-positioned marketplace in the Western world, is expanding by two digits from one year to another, thus strengthening its position as a costly intermediary between sellers and buyers. And the matter is not only the high cost of doing business through Amazon, but also the control such a giant has on the sellers: as a seller on a marketplace you always risk to have your product copied by the marketplace’s owner or to be cut out of the platform.

Blockchain can enable sellers to overcome their constant fear to lose access to customers. Blockchain is the key to creating decentralized marketplaces, through which seller can control their company’s destiny. Tokenized discounts or bonuses could be used to lure buyers to the platform. Therefore, blockchain becomes more and more relevant in the ecommerce world and it could mean a better future for both businesses and individuals.

There was no single revolutionary technology that emerged in the last two decades without being enthusiastically adopted by big techs – from cloud, to augmented reality and artificial intelligence. However, they didn’t seem to be interested too much to invest in blockchain so far.

Could this be a sign that they are afraid of its potential to disrupt their business models? We will find out soon as we see a glittering future for blockchain.