[gregmac]

Am I the only one struggling to decipher this?

I thought web3 was supposed to be some kind of decentralized compute, where rather than run on your own hardware or IaaS/PaaS you could make use of compute resources that vary wildly day-to-day in availability, performance, and cost, because they were somehow also mining rigs or something? But it's "decentralized" because there's not one entity running the thing.

There is not a mention of that in the article.

Is it actually supposed to just be microtranscations paid with cryptocurrency? Where's the "decentralized" part of that?

Anyway, instead the best I can see this article seems to be talking about how it turns out people aren't using blockchain for buying things, and makes the (apparently) shocking conclusion "the one thing people always wanted: money that just works."

[aurareturn]

  I thought web3 was supposed to be some kind of decentralized compute, where rather than run on your own hardware or IaaS/PaaS you could make use of compute resources that vary wildly day-to-day in availability, performance, and cost, because they were somehow also mining rigs or something? But it's "decentralized" because there's not one entity running the thing.

Web3 is a rebrand of crypto scams. The 20018 crash exposed the crypto industry to how wide spread its scams were. So the industry rebranded to "web3". Nothing changed.

The scam message was that so many people got rich investing in web2.0 companies like Facebook. You can get rich too by investing in web3 (shitcoins & NFTs).

[zerkten]

Web 3.0 was a synonym for the Semantic Web (https://en.wikipedia.org/wiki/Semantic_Web), but the term was taken over by crypto folks as it dropped off after the mid-2000s.

[aurareturn]

Side note: LLMs made semantic web completely irrelevant.

[jowea]

Web3 was quite a cryptoassets sector buzzword, but the decentralized part of that is "cryptocurrency".

If we take the buzzword seriously, yes there was more to it than microtransactions with cryptocurrency, but without personal wallets on the blockchain capable of those transactions the rest of the ideas like NFT tickets, Decentralized Finance etc are impossible.

[mxwsn]

Stablecoins transferred $27 trillion in 2024 - more than Visa and Mastercard combined. This is right in the article.

Stablecoins operate using decentralized ledgers on e.g. Ethereum which use decentralized compute. This isn't mentioned explicitly because the target audience knows this already.

[aurareturn]

  Stablecoins transferred $27 trillion in 2024 - more than Visa and Mastercard combined. This is right in the article.

Vast majority is from one exchange wallet to another. Left hand to right hand.

[TheDong]

That comparison isn't really equal.

Visa / Mastercard have such large fees that they're mainly used for commercial payments like a coffee or couch.

If most of the Stablecoin transactions were for buying a coffee, I think it'd be fair, but the vast majority of stablecoin transactions are for shuffling money around, i.e. to buy and speculate on bitcoin, or to move money to an exchange to liquidate some crypto into cash.

I think the current use of stablecoin transfers is closer to a wire transfer.

SWIFT apparently deals with about $1.25 quadrillion/year, so ~50x the claimed amount for stablecoins in the article... though there's more than just SWIFT out there too.

idk, I don't really have a point, I'm both amazed stablecoins are such a big number, but also feel like the comparison the article's making with VISA is misleading for how they're currently used.

[oersted]

Aren’t stablecoins also backed by a central authority that guarantees it will always exchange the coins for a fixed amount of cash? That’s what makes them stable right? At least the major ones like Tether.

And by now we have seen many cases of stablecoins predictably crashing when trust in that backing authority dissolves. Most famously UST/Luna but it’s a long list.

I suppose they are useful for covert transfers, and the actual transfer mechanism is decentralized. But they are strictly worse than normal currencies for storing wealth, since the backing authority is a private company with virtually no oversight. And the utility for transactions would vanish if you were not confident that you can exchange it back and forth with cash immediately before and after the transfer.

[solumos]

Not exactly. Internet Computer or Akash Network would be more closely aligned with "decentralized compute" — smart contracts in the EVM world aren't really meant to decentralize "general" compute, but they do provide primitives for programmable transactions. Those transactions can include a "token" as well as abstractions on top of tokens (e.g. a vault)

[pests]

To give you a real answer instead of just bashing crypto:

There is no real compute happening on the actual blockchain. The more instructions you have to execute, the higher the gas, the larger the fee the user will have to pay. The blockchain is used more as a database which the Web3 app can then query (for free) and use as a source of truth. It's not just currencies and microtransactions - game stats, property ownership, a users notes or todo list, anything you want. But you are definitely not doing any kind of major compute.

Web3 now refers to web apps that interact with a blockchain instead of a server API. They are mostly built with modern web technologies (React, Vue, etc.) Many are opensource and lots of communities participate in developing standards and in participating bodies. Uniswap, for example, is a website and underlying protocol for changing one coin into another, is now on v3 (UniswapV3) and many other projects and companies (SushiSwap, PancakeSwap, etc) take this frontend and the blockchain contracts to implement their own compatible offerings.

These API call's go through your wallet (usually a browser extension or app) which injects the JS needed into the website or handles it itself. The wallet will usually perform an RPC to a remote server to perform the actual blockchain communication. Most chains have default free RPC servers but you can also pay for a more premium/less latency/higher uptime RPC services. You can also run your own RPC infrastructure and handle that yourself.

User identities are tied to wallets. You do not have to sign up or join any Web3 app, you just "Connect" your wallet which is a free action which basically consists of signing a pre-generated message vouching you are joining which the Web3 app can verify.

Many standards have developed like Uniswap mentioned earlier. Interfaces for NFT's, delegated spending (to condense transactions and save gas fees), notifications, chat. Because all contracts are on a chain and every frontend is just a webapp, and many services ensure transparency by posting the source code for their contracts, it enables seamless integration of other APIs.

For example, another layer has been abstracted on top of UniswapV3. Since there is hundreds of swaps all supporting UniswapV3, you then had the development of apps called "routers" which would check all the swap sites and find you the cheapest rate. These routers can even swap between multiple token chains and assets to arrive at your end coins.

One more way this is more decentralized. If any of these web frontend's were to go away, the contract still exists and you can manually call it's functions to achieve your goal like withdrawing money, reassigning an NFT, or evolving your pet.

Furthermore, since all Web3 apps are just really calling contract's behind the scenes, it's easy to just send these actions yourself in a program. You can turn 20 clicks in some UI into a script that does the same interfacing with the blockchain directly.

One last point, but all this data is being stored on chain and is exportable and backed up forever by millions. I have personally had trouble with losing devices and having poor backup discipline. So, I have stored my personal notes and todo list in a custom (encrypted) contract I wrote a few years ago. I can lose access to every device or password I know and can still access it anywhere in the world because I have memorized my 12 word wallet mnemonic and every node has a copy.