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What You Need to Know About Web3, Crypto’s Attempt to Reinvent the Internet

Enthusiasts say tokens can change computing. Is this the real deal or vaporware?
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Illustration: Harry Bhalerao for Bloomberg Businessweek
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If you follow the world of cryptocurrency even casually, you know it produces a constant supply of jargon. There’s NFT, dapp, DeFi, and tokenomics, to name a few. Brace yourself for a new one: Web3. The idea is that crypto isn’t just for sending money or speculating with, but could be used to build a whole new web. If the believers are right, this is one bit of cryptospeak worth getting familiar with, even if you never touch Bitcoin.

Of course, the software behind the internet is changing all the time. What makes Web3 different—and more than a little weird—is that it would build financial assets, in the form of tokens, into the inner workings of almost anything you do online. And by doing so, its boosters say it could supplant corporations with decentralized, internet-based organizations governed by software protocols and the votes of token holders. “It’s the first real consumer penetration” for crypto, says Jeff Dorman, chief investment officer of crypto fund Arca. “Over time, every company became an internet company. I think it will happen here in digital assets.”