In recent years, Web3 technology has emerged as a transformative force. This has fundamentally altered how people interact with financial tools/services, social networking, and Artificial Intelligence (AI). Through the rise of Decentralized Finance (DeFi), Web3 and blockchain technology have redefined finance. The DeFi market size declined to less than US$50 billion in April 2023. Even though this was a significant drop from its all-time high of US$248 billion in November 2021, it shows just how much growth there has been in the industry.
This growth has disrupted the conventional financial landscape, otherwise characterized by centralized institutions and limited access. This same Web3 effect is being felt with AI and social networking. Today, AI is being absorbed into diverse applications and we are seeing the rise of user-centric social networking platforms. These platforms are empowering users with the ability to govern their presence online with trust and transparency. In this article, we will explore the impact of Web3 across these critical sectors, shedding light on how this innovation has disrupted conventional norms.
Redefining Finance With Decentralization
A seismic shift is being felt in the financial sector. This shift is driven by the advent of DeFi and backed by the introduction of innovative blockchain-based financial instruments. The concept of DeFi lies at the heart of this disruption. This concept has democratized finance by providing unprecedented access to a wide range of financial services. These services like lending, borrowing, and trading digital assets, are now being seamlessly provided within a trustless ecosystem. For a sector still in its nascent stages, the Total Value Locked (TVL) in DeFi which signifies the level of adoption is impressive. As of the time of writing, the TVL in $$ is US$38.2 billion.
The days of relying on traditional banks and financial institutions who act as gatekeepers to these services are fading away, fast. This removal of the 'middleman' has seen transactions carried out in an efficient, fast, and safe manner. Facilitating the removal of these intermediaries are DeFi platforms. Their growth has been nothing short of remarkable. DeFi platforms offer users plenty of financial products and services like Decentralized Exchanges (DEXs), yield farming, liquidity provision, etc. These platforms, which are based on open-source and blockchain concepts, provide security, accessibility, and transparency.
Manilla Finance is a shining example of a DeFi platform operating on these guiding principles. The platform provides a service that seamlessly integrates utility tokens into everyday life by enabling utility bill settlements in native cryptocurrency tokens. This innovative approach not only showcases the utility of blockchain technology but also paves the way for a transition from Web2 to Web3 in financial technologies.
Web3 AI-Powered Solutions
Artificial intelligence is one technology that has found it easy to settle in in the Web3 space. The introduction of AI in the ecosystem has unlocked unprecedented innovations in data analysis, automation, and decision-making. It has also given rise to conversational AI interfaces like chatbots. This helps to facilitate interactions with various crypto markets, ultimately enhancing user experiences. In an interview with NASDAQ recently, Eric Pulier, founder and CEO of Vatom, a leading Web3 technology said, "The fusion of AI and Web3 is more than just a technological milestone; it's a stepping stone towards a more equitable, efficient, and secure digital world."
Eric's view about AI and Web3 cannot be more right. The convergence of AI and Web3 provides users with friendly interfaces that connect centralized and decentralized financial markets. Through these AI-driven interfaces, users have direct access to diverse financial services, can automate transactions, receive real-time data and insights that simplify complex economic activities, and enhance accessibility across both traditional and emerging decentralized ecosystems. An example of a Web3 AI-powered platform is GT-Protocol. It is a Web3 AI execution technology that provides users with access to CeFi, DeFi, and NFT crypto markets through an all-in-one conversational AI interface.
Social Networking in the Non-Custodial Ecosystem
Web3 has introduced the concepts of decentralization, permissionless innovation, and non-custodial control in the social networking space. These social networks grant the users ownership of their data and interactions. This is a departure from the centralized models of traditional platforms. Web3 has shown a remarkable ability to connect these domains with a single decentralized ecosystem and this has ushered in an era of interconnected innovation, creative collaborations, and innovative business models.
Phaver, a Web3 social app purpose-built for the permissionless and non-custodial ecosystem within the next-gen Internet is an example of a social networking platform in the Web3 ecosystem. In an AMA with CyberConnect hosted by CoinTelegraph in August, CEO & co-founder of Phaver Joonatan Lintala said, "We already have 250,000 unique users and we want to bring the next billion people to Web3."
While it is impressive just thinking of the boundless opportunities that await, challenges like scalability, security, and compliance with regulatory frameworks must be navigated responsibly as the ecosystem keeps evolving. With social networking done well, transparency, trust, and innovation will all be realized without sacrificing ethics or security.
Conclusion
Web3's Impact on Finance, AI, and Social Networking underscores the groundbreaking transformations that are reshaping these critical domains. Web3 heralds a future where DeFi democratizes access to financial services, AI-powered interfaces boost seamless interactions, and user-centric social networking prioritizes privacy, transparency, and control.
The Web3 ecosystem's future, where innovation knows no bounds, is represented by this. We must, however, recognize that there will be difficulties ahead. To fully realize the potential of Web3, issues relating to security, scalability, and regulatory compliance will present significant obstacles that must be carefully negotiated and overcome.