Digital Cash

What is "Blockchain" and "Web3"?

A blockchain is a collection of computers, usually globally spread out and controlled by different people, that work together to create a chain of blocks. Each one of these blocks is simply a block of data. A bit like, say, a new page in a book, or a new sheet in a spreadsheet. These computers all run the same blockchain software and all work together to record each transaction that is requested by users of the blockchain. As each occurs, the computers add it to the new block (in our analogy think adding it as the next sentence on the page in the book, or adding it as the next row in a spreadsheet).

Blocks on a blockchain

There’s a live viewer of blocks being created right now on the Cardano blockchain if you’re interested:

Once its time to start a new block, the computers all lock the last one and create a mathematical signature that stops anyone ever being able to change it (by using cryptography – very clever maths).

These blocks of data remain on the blockchain, forever. Anyone can view them, no one can ever change them.

Web3 is a broader term. It incorporates blockchain because it is a key part of Web3. That’s because an ideal blockchain is “decentralized”, which means it can’t be controlled or altered by any one person, company or government. Instead, a decentralized blockchain is a global entity in its own right, beyond the borders and control of individual countries and governments.

Web3 is the successor to Web2, which is the current version of the internet. Web2 is all about “user-generated content” – content added by the users of the internet. Think Facebook, X, YouTube, etc. Web3 seeks to remove the power that has ended up in the hands of a few large companies that control these Web2 websites and internet services. Web3 is all about “hey if you wrote this song, if you wrote this book, if you created this video, you should own your content and be able to distribute it and even make money off it under your own terms, without having to accept nasty terms and conditions of the large companies who currently control all the popular internet websites and services”.

Giving the power back to the people.

This is why blockchain and Web3 has such a massive community of developers and businesses working on it and who are so excited by it. They all already know its going to succeed, because it offers something the general public will really want. Just as the internet itself did 25 years ago.