Imagine an internet passport, your key to seamless access across the web—Facebook, Instagram, Google—all with a single identity. No more endless registrations or password hassles. Your online footprint? It lives in your cloud vault, under your control. That is true ownership of your identity and data-that is Web5.

Well, the world is still discovering Web 3 (an iteration of the World Wide Web that incorporates concepts such as decentralization, blockchain technologies, and token-based economics), how come Jack Dorsey, the former CEO of Twitter decided to leap forward to what he dubs "Web5"?

Before delving into the details of web5, let’s step back and explore the web’s history itself. The internet was brought to life in 1963 as a way for government researchers to share information, driven by the essential requirement for a robust network capable of withstanding disruptions, especially in times of conflict.

As it evolved, Web1 emerged, offering static web pages that opened the door to a new era of accessible information. Then came the second generation of the internet, Web2, introducing dynamic interactions and the birth of social media platforms like Twitter, fundamentally altering how we connect in the digital space. Later, Web 3 was introduced, promising us a decentralized era, and offering users complete freedom and control over their data, however as it developed, there had been certain compromises that had nullified its concept of full decentralization. This issue is what Jack Dorsey aims to tackle by “bringing a decentralized app and protocol layer to the web” with the development of web5.

So, what is Web5?

Web5, to put it simply, is an ecosystem that enables developers to build decentralized applications that prioritize data ownership and user privacy.

Intending to build an online system that shields against the influence of big tech companies, it wants to make sure personal data is truly secure by giving control of digital identity back to individual users. To do this, Web5 combines the user-friendly convenience of Web 2.0 with the mission of decentralization pioneered by Web3 design while putting you in control of your data and identity.

“The fundamental purpose of Web5 is to give users control over their data,” said Michael Pierce, CEO of NotCommon, a multi-cross-chained Web3 platform that alerts non-fungible token (NFT) collectors of security threats targeting their pieces. “Essentially, the concept attempts to democratize the web by eliminating gatekeepers that effectively centralize technology.”

Jack Dorsey's Vision for Web5

Jack Dorsey, the former CEO of Twitter and the face behind Web5's inception announced his distinctive vision for the decentralized internet at the crypto and blockchain conference Consensus in June 2022.

Backed by his team at TBD, a division of his financial technology company Block (SQ), he addresses his core concerns about Web3, which he believes will never be fully decentralized; to do this, TBD just added Web2 (centralized content platforms, like Twitter or Facebook) to Web3 (an internet powered by blockchain-based smart contracts). However, this technology will not be associated with the blockchain and cryptocurrency space (unlike Web3), except Bitcoin alone. This is because he perceives Bitcoin as the only cryptocurrency that truly matters, and according to him, other cryptocurrencies have been tainted by venture capitalists who have started making it centralized.

This means that Web5 won't use "special utility tokens" or rely on subjective consensus. This sets it apart from platforms like the Ethereum Name Service, which use governance tokens and are controlled by decentralized autonomous organizations (DAOs). In making this choice, Web5 creates a solution to Jack Dorsey's worries about centralized influences undermining the decentralization goals in the larger Web3 community.

How Web5 works

Web5 was built on the Bitcoin blockchain, leveraging its lightning network, a Layer 2 payment protocol existing independently of the main Bitcoin blockchain. The purpose of this lightning network was to take over all the transactions that can occur on the layer 1 blockchain because that’s where the “heavy guest fees” that are associated with layer 1 transactions are. This strategic choice enables rapid network functionality, free from tokens, transaction fees and trusted validators.

Here are some key features of web5.

Decentralized Identity Management: Users can manage their digital identities using decentralized protocols, ensuring that they maintain ownership and control over their personal information.
Data Ownership and Privacy: Users can choose what data they share with various platforms and services, empowering them to make informed decisions about their privacy.
User-Friendly Interfaces and Accessibility: Web5 applications strive to be user-friendly and accessible, catering to a broader audience and promoting inclusivity in the decentralized web ecosystem.

Foundations of Web5: The Essential Elements of a Decentralized Internet

Decentralized Identifiers (DIDs): Self-sovereign digital identities that provide individuals with control over their personal data.
Decentralized Web Nodes (DWNs): The building blocks of a decentralized internet, responsible for storing and verifying data.
Decentralized Web Applications (DWAs): Applications that operate on decentralized networks, empowering users to interact with data and services without intermediaries.
Verifiable Credentials: Verifiable digital credentials that allow users to share their credentials securely and prove their authenticity.

Web5 Vs Web3

While Web3 promises decentralized freedom, Web5, led by Jack Dorsey, goes further, promising us "extra-decentralized freedom". Web3 and web5 are very similar as their initial objectives are almost the same.

“The creation of Web5 does not imply the failure of Web3; They are just two approaches with a similar goal of decentralizing the Internet,” said Josh Drake, chief operating officer at Dfinity Foundation, a not-for-profit organization developing a public blockchain known as Internet Computer Protocol. “The main difference is Web3 represents a diverse ecosystem of builders with a wide range of existing use cases and innovations, whereas Web5 is a relatively new platform, currently in its conceptual stage.

Despite the similarities, they also have key differences; here are some of them:

Wallet Storage: Web5 focuses on DID-based wallets, offering a more user-friendly and secure experience compared to Web3's reliance on complex blockchain wallets.
Blockchain Usage: Web5 utilizes Bitcoin Lightning Network for efficient and scalable transactions, while Web3 often employs various blockchains with varying performance characteristics.
Smart Contracts: Web5 emphasizes DID-based smart contracts, which provide a more intuitive and user-friendly approach compared to Web3's complex smart contract development.
Tokens: Web5 focuses on utility tokens that serve specific purposes within applications, while Web3 often utilizes native tokens for governance and incentives.
Collaboration with Web 2.0: Web5 seeks to coexist with Web 2.0, enabling interoperability and data portability, while Web3 often aims to replace existing Web 2.0 platforms.

What about Web4?

Web4 was not totally skipped in the ecosystem of the internet, in fact, it is known as the Semantic Web, which plays a complementary role in Web5's development by organizing and structuring data, making it more accessible and interpretable for decentralized applications.

Real World Applications of Web5

Social media:

Web5 social media platforms represent a significant advancement over their Web3 counterparts by placing user empowerment and data privacy at the forefront. These platforms empower users to control their data, manage their privacy settings, and curate their content experiences without the constraints of centralized intermediaries. Take, for instance, Bluesky, a social media initiative backed by Jack Dorsey. It endeavors to develop a decentralized social media protocol that aligns with Web5 principles—emphasizing user control, privacy, and interoperability. In this decentralized landscape, transparent data ownership models and user-centric design foster trust among users, mitigating concerns about data privacy. The result? A more open, democratic, and censorship-resistant online discourse.

E-commerce:

Decentralized marketplaces mark a significant step forward in e-commerce by facilitating trustless transactions, eliminating the need for intermediaries and reducing the risk of fraud. This innovative approach empowers buyers and sellers to interact directly, fostering trust and confidence in the decentralized marketplace ecosystem. Imagine a platform where buyers and sellers interact directly, eliminating the need for intermediaries and reducing the risk of fraud. This decentralized approach empowers users and introduces community-driven governance models. Standardized protocols enhance interoperability, ensuring the seamless flow of goods and services across these trustless marketplaces. The potential for user participation in decision-making processes shapes the future of these platforms, fostering a more inclusive and user-centric e-commerce ecosystem.

Finance:

Web5's impact on the finance sector, particularly decentralized financial applications (DeFi), is transformative. DeFi applications democratize access to financial services, providing the underbanked with opportunities for lending, borrowing, trading, and investing without traditional intermediaries. Web5's commitment to Bitcoin and its avoidance of certain blockchain features align with a vision for a more decentralized financial landscape. While regulatory compliance remains a challenge, ongoing collaboration between regulators and the DeFi community could pave the way for a compliant and sustainable decentralized financial ecosystem.

Gaming:

Decentralized games represent a paradigm shift in the gaming industry, offering true ownership of in-game assets and collectibles. This user-centric approach empowers players to own their digital assets and trade them securely on decentralized marketplaces, fostering a more equitable and transparent gaming economy. Beyond ownership, these games hold the potential for community-driven gameplay mechanics, allowing players to actively contribute to the development and governance of the gaming experience. Addressing scalability challenges is crucial for ensuring these decentralized games accommodate a large player base and complex gaming environments.

Web5 Apps in the Making

One of the notable applications within the Web5 ecosystem, Zion, leverages Bitcoin's base layer to facilitate collaboration between content creators and their audience. This commitment to Bitcoin and avoidance of certain blockchain features marks Web5's attempt to preserve the purity of decentralization, as per Dorsey's vision.
Bluesky, a social media initiative backed by Twitter co-founder Jack Dorsey, is an example of an early adopter aligning with Web5 principles. If you have ever wondered why we all had to use a certain code to open a Bluesky account when it was first launched, well I guess you know why now.
Another glimpse into the potential of Web5 is seen in the TBD Pitch Deck application. This Web5 app seamlessly accessed a playlist from Groove and effortlessly transferred it to another music app, Tidal. The live demonstration illustrated the interoperability and user-centric design present in Web5 applications. The ability to move data across different platforms without compromising security or ownership highlights the practical advantages of embracing Web5 principles in diverse application scenarios.

Web5: The Next Generation of the Internet

As we look ahead, Web5 stands out as a game-changer for the rapidly evolving internet. Following its announcement in 2022, it has been successfully released and is now used by developers to build fully decentralized applications and technologies. Amid tech changes, Web5 points us toward a digital future that's clear, user-focused, and decentralized.

Web5: The Future of Internet Ownership and Privacy

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