Web3 is the idea of an internet built on blockchains, where wallets and tokens replace platform accounts and users own their data and assets rather than renting them from a company. Gavin Wood, a co-founder of Ethereum, coined the term in 2014.
Whether it has arrived is genuinely contested. Some of it shipped and works. Much of the promise did not, and the sharpest criticism came from people with no reason to be hostile to the idea.
Web1, Web2, Web3
The framing is a simplification, and it is a useful one.
| Roughly when | What it meant | |
|---|---|---|
| Web1 | 1990s to early 2000s | Read. Static pages, mostly published by whoever ran the server |
| Web2 | Mid 2000s onward | Read and write. Users create content, platforms own the accounts and the data |
| Web3 | Proposed from 2014 | Read, write, own. Wallets replace accounts, assets move between applications |
One point of confusion worth clearing early. "Web 3.0" usually refers to Tim Berners-Lee's semantic web, an older and separate idea about machines understanding the data on ordinary websites. Web3 is the blockchain version. The names collide and the concepts are unrelated.
What Web3 was proposing
Trust was the subject of Wood's original argument. Web2 requires trusting companies to hold your data, honour your account, and not change the rules. His proposal was a system where interactions happen pseudonymously and, for many services, without needing to trust any single party at all.
Concretely, that translates into a handful of shifts.
- Wallets instead of accounts. No sign-up, no password, no company able to close your account. Your crypto address is your identity.
- Assets that move between applications. An item earned in one game usable in another, because the token exists on a chain rather than in a company database.
- Open protocols instead of platforms. Anyone can build a competing interface to the same underlying data, so switching does not mean losing your history.
- Token-based ownership. Users hold stakes in the networks they use, whether through governance tokens, an airdrop, or an altcoin tied to the protocol, rather than only shareholders holding them.
What actually shipped
Some of it works today and has for years.
- Wallet logins. Signing in with a wallet rather than an email and password is standard across crypto applications, and account abstraction has made those wallets programmable.
- Decentralized exchanges. Uniswap has run since 2018, letting anyone swap tokens without an account or an intermediary.
- Naming systems. ENS has mapped readable names to addresses since 2017.
- Stablecoins. Dollar-denominated tokens moving value across borders continuously, which is arguably the most-used product crypto has produced.
- DAO treasuries. Groups controlling shared funds through on-chain voting, with the spending publicly auditable.
- NFTs as credentials. Ticketing, access passes, and in-game items, once the speculative market receded.
None of that is nothing. It is also considerably narrower than what was being promised in 2021.
The criticism
Two interventions from that period defined the debate, and neither came from a crypto sceptic in the ordinary sense.
Jack Dorsey, December 2021. Three weeks after stepping down as Twitter's chief executive, he posted that users do not own Web3 and that the venture firms and their investors do. Coming from a co-founder of a defining Web2 platform, and someone openly enthusiastic about Bitcoin, the criticism carried weight it would not have had from an outsider.
Moxie Marlinspike, January 2022. The creator of Signal built two blockchain applications and published what he found. His central observation was that almost nobody wants to run their own server, so in practice users reach blockchains through a small number of centralized API providers. The trustless consensus mechanism underneath was real, and virtually every client accessing it was simply trusting the output of two companies.
His second argument was structural: protocols move slowly and platforms move fast, so platforms win. Email has stayed unencrypted for decades while a single messaging app shipped end-to-end encryption to billions.
Vitalik Buterin and Coinbase's chief executive both publicly acknowledged the points were largely correct, which is the detail that made the essay difficult to dismiss.
Where the argument stands
Honestly summarised: decentralization exists at the base layer and thins out sharply above it.
Chains themselves run across thousands of independent computers, and that part is real. Access to them concentrates through a handful of infrastructure providers, wallets, and marketplaces. A user interacting with a decentralized protocol through a centralized front end is, from their own perspective, still depending on a company.
Against that, the counterargument runs that this is what an early stack looks like, and that an open base layer means alternatives can always be built. That is true and unproven, and the same was said in 2022.
Which of those two readings is right will likely be settled by whether people ever choose to run their own infrastructure. So far the evidence says they will not.
Where mb.io fits
Regulated custody and self-custody solve different problems, and both are legitimate answers to the question Web3 raised about who holds your assets.
mb.io is a regulated crypto spot exchange backed by MultiBank Group, a financial institution founded in 2005 that serves more than 2 million clients across 100+ countries.
- Regulated by VARA in the UAE and AUSTRAC in Australia
- 10/10 security score from Hacken, an independent blockchain security auditor
- Institutional-grade MPC custody powered by Fireblocks, with segregated client funds
- A curated list of assets, so you're not sorting through thousands of tokens to find the ones worth trading
- Buy, sell, and swap in three steps, from sign-up to purchase
- 24/7 customer support, on web and on the iOS and Android apps
Open your account and start trading on mb.io.
Frequently asked questions
Who coined the term Web3?
Gavin Wood, a co-founder of Ethereum, in 2014. He described it as a system where interactions happen pseudonymously and, for many services, without requiring trust in any single party.
Is Web3 the same as Web 3.0?
No, though the names get used interchangeably. Web 3.0 usually means Tim Berners-Lee's semantic web, about machines reading data on ordinary websites. Web3 is the blockchain version, and the two ideas are unrelated.
Is Web3 actually decentralized?
Partly. The chains run across thousands of independent computers. Access to them concentrates through a small number of API providers, wallets, and marketplaces, which was Moxie Marlinspike's central criticism in January 2022.
What can I actually do with Web3 today?
Sign in with a wallet, swap tokens on a decentralized exchange, use a readable name instead of an address, hold stablecoins, vote in a DAO, and hold tokens representing tickets or in-game items.
Do I need crypto to use Web3?
Creating a wallet and browsing applications costs nothing. Acting on-chain does, since transactions require gas fees paid in the network's own token. That describes how the machinery works rather than suggesting anything about buying.
Is Web3 dead?
The 2021 hype cycle ended. Working parts kept running, and stablecoins in particular have grown considerably since. The gap between what was promised and what exists is the substance of the ongoing argument.
What is the difference between Web3 and crypto?
Crypto refers to the assets and the networks. Web3 is a broader claim about how the internet could be restructured around them. Every Web3 application uses crypto, and plenty of crypto activity has nothing to do with Web3.
