Web3: The future of e-commerce

December 29, 2021 by
Frank Calviño
Photo by Shubham-Dhage for Unsplash

Seems like everybody is talking about the so-called Web3. But, pretty much as it happened before with the Multiverse, the whole concept of what it truly is the Web3 is mostly misunderstood. 

And in this particular case, understanding what is the Web3 and it how will completely change the rules of the internet as we know it, is vital. Especially for e-commerce. 

Truth be told, the whole idea of Web3 has one of its main pillars to provide a far more secure, faster, and efficient ecosystem to guarantee e-commerce at a global scale, without the current security or currency conversion problems. 

To put it simply: Web3 capabilities could provide lasting and efficient solutions to many of the current Internet issues concerning e-commerce. But, what is exactly the Web3? 

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How will Web3 work? 

The Web3 idea is that of creating an umbrella term for an online ecosystem that cuts out the big middlemen on the Internet. So, platforms on Web3 are not owned by central gatekeepers and you wouldn’t navigate the Internet through search engines such as Google. 

???? This means that there won’t be a filtered vision of the internet, defined by the criteria of a private company. ???? 

And yes… before you even start asking about it… let us be absolutely clear with this next statement: most likely your internet is defined and to an extent, controlled by Google. 

And if you don’t use Google as a search engine, then your vision of the internet is filtered by Bing, Duck Duck Go, Baidu, Yandex, or whatever the search engine you use might be. 

???? Search engines filter and control the way we access sites on the web. ????

The whole idea behind Web3 is to use blockchain, the same system used by cryptocurrencies and non-fungible tokens (NFTs) so the users will become participants and shareholders by earning tokens on the blockchain system, allowing them to define and have a saying on the way the network behaves. 

The concept is complex to grasp if you do not have a basic - or even mid-level - understanding of computer coding and network engineering. To put it simply: it’s an internet in which websites will not be filtered by a private company algorithm, will not be hosted on a single database or physical server, and were tokens will be used as a form of payment and validation of all the data hosted in multiple blockchain ledgers all around the world, at the same time. 

The technical explanation: 

???? Web3 is a collection of JS libraries that lets you interact with an Ethereum node remotely or locally. Simply, it provides us with an API to use so we can easily work with the blockchain. Web3 works as a wrapper for JSON RPC to connect to a remote or local Ethereum node with either an HTTP or IPC connection. Web3 is basically a connection between the Ethereum blockchain and your smart contract. ????

How will Web3 affect e-commerce? 

Long story short: at all levels. But to be more precise, it will impact e-commerce in the following fields: 

  • SEO Ranking and online marketing 
  • Payments and Security
  • Accessibility and Logistics

Let us try to explain the possible changes that Web3 will bring to each one of these categories. 

Will Web3 be the end of SEO? 

Yes, at least the way we understand it. Web3 aims at removing the centralized search engines and this will, of course, vaporize Google or any other current search engines. 

Does this mean that Web3 will remove the search engines? No, search engines are needed for the entirety of the web to be accessible. But Web3 will transform - entirely - the way search engines work. Obviously, this will render absolutely ineffective the current SEO techniques, because the ranking criteria will change. 

The best way we have to explain this will be to say that currently all of Google’s decisions to rank a page are based on Google’s own algorithm. Web3 proposes that this will not be handled by a single “source” or database, but instead, by a “collective” decision-making process. 

Imagine multiple “mini-googles” that will literally plague the Web3 collecting data in multiple ledgers - this is the blockchain architecture - to later produce a sampling - a prorate - of the results. This will be the new ranking system. 

How much of this new system could be impacted by the current SEO techniques? No one knows for sure. But it is kind of a global consensus, that it will change so much, that current SEO will mean nothing. 

???? This means that your e-commerce could and probably will, change its ranking. With all the implications this has for the traffic and conversion. ????

What will happen to my online marketing? 

Another major issue will be the effect of Web3 from an online marketing perspective. Will it modify the prices for pay-per-click campaigns? It seems only logical to think that the prices of pop-up advertising and banners will rise under a decentralized environment like the one proposed by Web3.  

The new search engine results will be more varied than current search engines results, like Google. Henceforth, the amount of traffic will diminish and banners that are on sites with traffic will most likely increase their price. 

Unfortunately, until we start seeing firsthand the way the new search systems behave, no one will be able to answer these questions. The only thing we can say is that it most likely will transform the way online marketing is currently done. 

When will Web3 be active? 

And when will this happen? We do not know how - it will depend on the Web3 implementation rate and scalability - and acceptance. Currently, it seems that the whole idea is gaining strength and many companies are starting to openly support the concept of an internet-based on blockchain architecture. 

It could even happen that both, the current Internet and pioneering Web3 environments, could coexist for long periods of time. 

Is Web3 more secure? 

The first major impact for e-commerce that Web3 implementation will bring, is the fact that it is a far more secure environment for any kind of transaction. 

Web3 is constantly kept on track by multiple ledgers, held by many different and unrelated databases at the same time. This makes it almost impossible to be hacked or manipulated. 

In plain English? A buyer inside Web3 - obviously using Web3 payment methods - will have its money accounted for without mistakes possible and in real-time. And the e-commerce will get its payment without discussion and in real-time also because the transaction will be marked in ledgers from all over the world, the moment it’s made. 

???? This means that there is no reason, to distrust a buyer or a seller: if a payment is processed, it’s valid. ????

Ethereum and other tokens will be the economy of Web3

Another key advantage will be the payments with cryptocurrency. The Web3 will have a base architecture that will be native for the crypto world - in fact, is based on Ethereum, a cryptocurrency - and all payments made inside the Web3 environment will produce tokens that later could be used to buy physical items: food, clothing, anything that e-commerce can sell and deliver, which nowadays, is pretty much absolutely anything legal.

Also, if the transaction is done using Ethereum tokens, it would be native to the blockchain technology behind Web3. This means that there is no reason for it not to be instantaneous and absolutely secure, without the need for a banking authority to check and confirm the monetary exchange. 

Tokens can also  - and will be for sure - “self-generated” by the system. This is programable and allows Ethereum to create incentives for the programers or developers  - anyone helping to sustain the ledger accountability system or the data systems - involved with Web3 to receive a token for their efforts. 

???? These tokens could easily become the first and most efficient way of payment in a Multiverse future. ????

Web3 will change the way e-commerce companies are operated 

Also, the fact that everything will be held accounted for online at the same time in multiple records - the blockchain technology - will make absolutely possible to work any industry inside the Web3 - even the ones that require physical processes - to be worked remotely. 

Drone factories and even drone farms will be far more impervious to possible hackings or cyberattacks. And with these capabilities and extra security, the possibility of assembling a drone factory in any place of the world, and then later operating that factory from any other location, will surely change the way industries are conceived. 

???? For example, countries that promote industry could get a lot of drone factories, while the headquarters and fiscal addresses of those companies, could very well be on other nations. ????

In fact, working remotely would be the only logical way to operate inside a Web3 environment, because the benefits of remote work will outweigh by far the operational costs of having physical workstations. 

Finally, it seems pretty evident that the implementation of Web3 - predicted to start in 2022 - will be the first step towards a sustainable permanent online environment, the final stage of the Metaverse. And so far, many companies are starting to pledge themselves to promote and implement Web3. There is an obvious coalition against those who are perceived as the internet “guard dogs”: Google, Bing - Microsoft - and the rest of the current internet giants. 

All in all, regardless of the support it could get, Web3 will take a while to be fully implemented. And even when it is perfectly possible to start seeing some test environments this next 2022, the full implementation of a stable massive Web3 environment will likely take over three years to be achieved.

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