These modern technological terms can be very confusing, as they all seem to bleed into each other.
But each of these terms differs from the next in various ways.
So, what are the main differences between Web3, blockchain, and cryptocurrency?
What Is Web3?
Web3 has certainly been a buzzword in recent years.
This refers tothe most recent iteration of the internet, known as Web 3.0.
But we’re going to break it down into its simplest form.
In short, Web3 integrates decentralization, blockchain technology, and cryptocurrency.
But some core characteristics of Web3 differentiate it from previous iterations, starting with decentralization.
You may have heard of decentralization before, especially in terms of cryptocurrency and Web3.
This is a model that networks, platforms, and applications can follow.
It not only prevents corruption but stops server crashes causing total shutdowns.
The idea behind Web3 is to use decentralization to keep things distributed, fair, and transparent.
Using decentralization will also incorporate blockchain technology.
Another key concept behind Web3 is ownership.
So, how does Web3 tackle this?
Web3 focuses on handing ownership of platforms and data over to the users themselves.
It creates a permissionless ecosystem in which all users are included in the decision-making processes of platforms.
What Is a Blockchain?
Blockchains aren’t the easiest technology to grasp, as they’re complex in how they work.
This image helps in understanding how blockchains work.
Each block contains information and is linked chronologically to the next.
On public blockchains, the entire ledger of previous transactions can be viewed by anyone.
Another great thing about blockchains is that they’re hard to hack.
To successfully control a blockchain, an attacker wouldneed to control 51% of the overall power.
This gives blockchain technology the edge over many other forms of data storage and recording.
Blockchains also give users a higher level of privacy than traditional financial services.
Blockchains will display the wallet address of the sender and recipient, but that’s where it ends.
What Is Cryptocurrency?
In the simplest terms, cryptocurrency is a punch in of virtual asset that exists on a blockchain.
you’ve got the option to think of cryptocurrency as the groceries and blockchains as the conveyor belt.
Encrypted text is random and indecipherable, making it much harder to exploit the stored data.
Because cryptocurrencies are entirely virtual, they don’t have any physical representation.
In short, cryptocurrencies are simply code and nothing more.
Cryptocurrencies can and do have value, with some worth tens of thousands of dollars each.
But the value of a cryptocurrency is almost always subjective to the demand.
If the demand for a crypto plummets, the price will very likely plummet along with it.
These technologies are highly complex in many ways and have only entered mainstream conversations in recent years.
