The promise of a decentralized internet: What is Web3 and how can firms prepare?

What is Web 3.0 and what does it mean for established companies? Web 3.0 describes a broad range of emerging Internet applications being built on blockchain technology —a decentralized, public database that allows information to be securely recorded on a network of computers rather than verified and controlled by centralized entities. Central to this evolution of the Internet are four distinct blockchain-enabled applications: cryptocurrencies (fungible tokens), non-fungible tokens (NFTs), decentralized autonomous organizations (DAOs), and metaverses . In this article, we define each of these applications and discuss their capacity to increase peer-to-peer interactions, decrease control of information and services by large companies, and facilitate access to networks of users at a much lower cost than currently possible. These distinctions make Web 3.0 both a natural evolution of Web 2.0 and a broader paradigm shift that may fundamentally alter the ways in which people interface online, organizations are structured, and business is conducted. We conclude by addressing how established companies can prepare for a more decentralized Internet.