Blockchain is everywhere: what do NFT and Web3 have in common?
We have been hearing for years the benefits of the blockchain. A technology of encryption and authentication which is good for a lot. But it wasn’t until a couple of years ago that there was an explosion of blockchain based projects and that they intend to come to stay. First it was cryptocurrencies. Then came the NFT assets. And now everyone is talking about the metaverse. Even Facebook name was changed to Goal. How are NFTs and Web3 different and what do they have in common?
What all these words have in common, cryptocurrencies, NFTs and Web3, are the blockchain. We have talked long and hard about this technology. Known in English as blockchain and as chain of blocks in Spanish, IBM defines it as “a general ledger shared and immutable for to register transactions, track assets and build trust.” The definition continues with “virtually anything of value it can be tracked and traded on a blockchain network, reducing risk and costs for everyone involved.”
In short, blockchain technology makes it possible to exchange information securely. This implies that this information is not corrupted or lost or altered. Or going back to the words of IBM: “It provides immediate, shared and completely transparent data stored in an unalterable distributed ledger to which only authorized members have access. And thanks to this technology, the Internet is experiencing one of its most important revolutions since its creation.
From blockchain to cryptocurrencies and NFTs
IBM says that any assets can be part of the blockchain. Tangible assets (buildings, vehicles, cash, land…) and intangible assets (patents, copyrights, trademarks, intellectual property). Those assets are represented by data that, according to Wikipedia, can be stored, transmitted and confirmed. And these are the keys to this technology.
Precisely, thanks to the characteristics of the blockchain, they have made it possible to create the cryptocurrencies or cryptocurrencies. The blockchain seeks that the information or data stored and transmitted are truthful, incorrupt, reliable. The same thing happens with a virtual currency. Nobody wants a coin easy to copy or forge. Hence the importance of cryptocurrencies. It is difficult to create them and they have a value in themselves.
And from there we go to NFT. Cryptocurrencies and NFTs are two sides of what the blockchain can do. In the case of the NFT, it is a digital asset the only one that cannot be divided or replicated. Y represents a unique virtual item, whether or not it has a physical equivalent. While identical cryptocurrencies can be created, hence its use as currency, the NFT is unique, even though it represents the same real world equivalent.
On a historical level, the first time that there is talk of block chain of encrypted information is in 1991. Those responsible for theorizing about it are Stuart Haber and W Scott Stornetta. Since then, the blockchain has been introduced little by little in companies for the exchange of data and information in a safe way. But the great boom occurs in 2008 when it sees the light for the first time Bitcoin, the first great cryptocurrency. Its creator is Japanese Satoshi Nakamoto, an alias whose real identity is yet to be known. In 2014, the blockchain technology begins to be tested for financial transactions and the platform and algorithm are born. ethereum.
Precisely, thanks to ethereum it is possible to create NFTs, what we know as non fungible tokens. Music, video, paintings, cartoons, trading cards, GIF animations… Anything real or virtual can become an NFT, an original and unrepeatable copy that has value in itself. And one of the keys that has made possible the generation of other projects related to blockchain, such as blockchain games or cryptogames and the metaverse.
Blockchain games are video games that employ NFT elements or virtual tokens. They can be used to get game assets or they can be the game assets themselves: weapons, armor, powers, extra lives, virtual properties… You can trade these assets. And on the other hand, by the mere act of playing, players can get prizes or tokens exchangeable for real currency, usually in the form of cryptocurrencies.
The metaverse is also nourished by cryptocurrencies and NFTs, since these three dimensional virtual worlds use all sorts of digital items and assets. And as we have seen, anything virtual is likely to become an NFT.
From blockchain to Web3
The Web3 is the most recent project related to the chain of blocks or blockchain. And, in turn, it is closely linked to the world of cryptocurrencies and NFTs. To begin with, to access Web3, instead of using an email you will use a virtual wallet or wallet. The same one that is used today to buy and sell cryptographic digital assets. This has an unavoidable commercial component, but on the other hand, its defenders emphasize its security and privacy.
Whereas today you identify yourself with your personal data or an easy to trace email address, at Web3 we will be a anonymous alphanumeric code. This will give us more privacy and prevent us from being traceable or that online companies and services can collect information about us. It will still be possible, but keeping our anonymity.
The New York Times credits ***** McCormick with making the concept of Web3 “fashionable.” This defines it as “an internet that is owned by developers and users, coordinated with tokens.” Precisely, a characteristic of Web3 is its decentralization. The Internet was created precisely as a decentralized network of networks so that if a few nodes fell, the network would remain standing. But over the years, large companies have been taking over this Internet and today there are small “hecatombs” every time the prices fall. Microsoft, Google, Apple servers either Goal (formerly Facebook).
In Web3 we will see similar services whom we already know. Social networks, video games… But with its own characteristics, such as decentralization and anonymity. Or the possibility of obtaining cryptographic tokens and/or trading with NFTs. What opens the doors to companies from all over the world to take part of a market until now limited to the big ones.
Although at the moment there is more theory than practice, what we do know about Web3 is that it will be based on the blockchain and on platforms such as ethereum to facilitate the exchange of NFTs, tokens and cryptocurrencies. Precisely, on Web3 you can pay by ethereumamong other cryptocurrencies accepted on the NFTs and cryptos platforms.