Starting Your Web3 Investment Portfolio
We have seen how the internet transformed lives worldwide. Thanks to this technology, we can share information and establish communication with anyone. Soon, we will see the internet undergo a significant transformation called Web 3.0 or Web3.
We are still on Web 2.0, but we have seen people make their fortunes from it for decades. Now, Web 3.0 brings new opportunities to those who would are bold enough to seize them. The most important question you must be asking yourself is, “Are you willing to invest in Web3?”
If you are, you should learn the three ways you can build your portfolio: metaverse stocks, cryptocurrencies, and NFTs. Next, you must familiarize yourself with the upcoming features of Web3. Compare them with 1.0 and 2.0 to understand how your Web3 investments will work.
Investing in metaverse stocks
You may not notice it, but many companies want to invest in the Metaverse. It refers to the merging of our real world and virtual reality.
We will soon be able to enter virtual worlds as if they were real-world locations. As a result, they would provide new opportunities such as never-before-seen jobs.
Web 3.0 is the upcoming upgrade of the internet, and the Metaverse is one of its crucial aspects. Businesses see it as a new way to sell their physical goods.
Others create digital assets with their brands in these virtual worlds. The concept may seem like something from sci-fi flicks, but we currently have real-life metaverse projects.
Let us take a look at some examples:
- Nike – The famous fitness brand launched a metaverse platform called Nikeland. You can find it on the hit online game Roblox where players can purchase Nike products as accessories for their in-game characters. Their avatars gain special in-game abilities such as higher jumps and faster sprints.
- Samsung – The Korean smartphone company established a metaverse platform named Samsung 837X. This firm is steadfast in its Web 3.0 investment as it offers NFTs for customers who register their Samsung products. Also, its latest smart TVs can store non-fungible tokens.
- Meta – Previously known as Facebook, Meta wants to facilitate the widespread use of the Metaverse. It has started a Metaverse platform called Horizon Workrooms, enabling employees to hold business meetings via remote work. Moreover, Meta is developing a VR headset for workplaces called Project Cambria.
These are publicly-traded companies, so you can add their shares to your portfolio. Nowadays, you can do it with a few taps on investment apps like Robinhood.
Investing in cryptocurrencies
You might be familiar with cryptos because of Bitcoin or BTC. Perhaps you have heard news reports about people making it big with their crypto investments.
Contrary to popular belief, they are not mere get-rich-quick schemes. They have multiple use-cases such as decentralized finance, decentralized autonomous organizations, and smart contracts.
Let us go through a summary of how they work. Cryptocurrencies are digital coins that are part of decentralized computer networks called blockchains.
People help operate the system by solving complex math problems to break encryption and confirm financial transactions. In return, they earn more cryptocurrencies.
As a result, crypto networks become a financial system that lets everyone benefit. Web 3.0 needs blockchain technology to become a more inclusive version of the internet.
Nowadays, you can invest in bitcoin and other cryptocurrencies via web browsers and mobile apps. At the time of writing, there are thousands of coins available. Let us look at the most promising Web 3.0 investments:
- Ethereum (ETH) is the second-largest cryptocurrency in terms of market capitalization. This network hosts many popular metaverse platforms. Also, it will soon receive a Web3-Esque upgrade called ETH 2.0. It is most likely to benefit from Web 3.0.
- Polkadot (DOT) is a decentralized exchange built on the Ethereum network. It uses blockchain networks to facilitate buying and selling cryptocurrencies.
- Chainlink (LINK) allows smart contracts to analyze and interpret real-world data to improve their functionality. Applying its features to Web 3.0 could provide significant improvements.
- The Graph (GRT) helps decentralized apps (dapps) to retrieve blockchain data quickly via an interplanetary file system. As a result, they can serve users quicker than before. GRT can help the parts of Web 3.0 work together as a cohesive unit.
Investing in non-fungible tokens or NFTs
You may have heard of NFTs as digital art pieces that sell for millions of dollars. They feature wacky images such as cartoon monkeys and kittens.
Like regular artworks, NFTs can gain value as time passes. Contrary to popular belief, NFTs are not just artworks. These non-fungible tokens allow people to record the ownership of physical and digital goods on a blockchain.
Apply this definition to NFT art, and you will realize that it has two parts: the NFT and the art piece. The non-fungible token proves your claim of a particular image.
Your NFT could retain value despite numerous free replicas. You can compare this situation to owning the original Mona Lisa instead of cheap printouts.
People recently felt shocked after someone smeared cake on the genuine Leonardo da Vinci painting at the Louvre. Do that on a cheap imitation, and no one will bat an eye.
Non-fungible tokens can have more significant use-cases than just art. For example, you could turn concert tickets into non-fungible tokens to prevent scalping.
The Philippines plans to use the technology to monitor mango supply chains. Web 3.0 can use NFTs to provide users with a unique identity for its services.
Moreover, people may gain more value from Web 3.0 if they could pay for NFT-enabled goods and services. Such an idea is not far-fetched since many Web3 blockchain projects host NFTs.
For example, Ethereum hosts many of the well-known NFT marketplaces. Polkadot rests on the ETH network, so the decentralized finance service also has non-fungible tokens.
Buying NFTs is as easy as purchasing cryptos and stocks on the internet. However, you will need a digital wallet like MetaMask to store these tokens.
Web 3.0: The Semantic Web
The current internet is a mish-mash of numerous networks. We can already do much with this version, such as searching images and buying products. However, the platforms do not work seamlessly with each other.
You can connect a gaming console and a PC to the same internet. Yet, the former has games you cannot play on a computer. That is because companies want to exclude their products from other platforms.
Letting their content on other devices could reduce their earnings. In other words, companies want consumers to only buy products from them so that they can make more money.
The definition of Web 3.0
That will change once Web 3.0 becomes a reality. It will provide the world with “open, trustless, and permissionless networks.” Let us elaborate on this definition:
- Open – The online networks will come from open-source programs to provide transparency. In other words, people will know how the entire system works.
- Trustless – Web3 users can choose whether to interact privately or publicly. It will not have a centralized control hub like a corporation or government that can look over every line of communication.
- Permissionless – Nobody would block your access to Web 3.0. You can enter and join without waiting on a private company or federal government.
The features of Web 3.0
This definition came from Tim Berners-Lee, who founded the World Wide Web (WWW). He also described features that will enable these Web3 aspects:
- Semantic Web – Bernes-Lee coined this term to describe how Web 3.0 will improve people’s creation, sharing, and connection with online content. What’s more, the new version of the World Wide Web will be able to identify patterns in content. You can use an early version when looking for images using a search engine.
- Artificial intelligence – AI lets apps perform tasks typically done by humans by recognizing patterns via natural language processing and machine learning. Web 3.0 will use these features to serve the needs of its users better
- 3D graphics – The next stage of the World Wide Web will use three-dimensional graphics. Virtual reality will allow Web3 users to experience these visual elements as real objects. For example, modern VR gloves let people feel these 3D objects.
- Connectivity – The current iteration of the internet already links content worldwide. However, Web3 will remove the exclusivity of some content so that people can access them from any device or app.
- Ubiquity – Content on Web 3.0 can link to each other. You already see this feature when you share content on social media. Your Facebook feed may contain posts that lead back to Twitter.
Web 1.0: The Read-Only Web
We have discussed the next evolution of the internet brought by digital tools like cryptocurrencies and non-fungible tokens. Web 3.0 will also improve services from these technologies, such as decentralized autonomous organizations.
It is not easy to appreciate these developments if we do not look back on the previous iterations of the internet. That is why we will talk about its version 1.0.
It represents the early days of the internet. The websites most used HTML with barely any graphical improvements from CSS. In other words, Web 1.0 only had static websites with more text than images.
The web pages looked like someone typed them on Microsoft Word, with default Times New Roman and Arial fonts. None of them played videos or enabled live chat. Here are the other rudimentary features of the early internet:
- We have mentioned that Web 1.0 only had static websites, meaning their content barely changed. Unless the website owner changes the content, you will not see anything new.
- In Web 1.0, you cannot change anything on websites, so users cannot input any information into them. Today, social media profiles change as you and your friends share content on your news feeds.
- Online services on Web 1.0 only worked for a specific company. Visitors were not able to check how the apps functioned. These people cannot apply changes to these services either.
Web 1.0 websites worked like books since you just read their text. People still read books back then. Laptops have not been popular yet, and old desktop computers were cumbersome.
The old websites were read-only, so why choose that over books? As a result, some believe the internet was merely a fad. Then, everything changed when Web 2.0 arrived.
Web 2.0: The Social Web
Chat services came out, enabling people to communicate with each other instantly. This feature was groundbreaking back then because folks only had email.
Believe it or not, there were social networking sites before Facebook. Millions of people use alternatives like MySpace and Friendster to share their thoughts and chat with each other.
This trend meant that websites started featuring user-generated content. Eventually, smartphones became more affordable and functional. For the first time, people could take photos and record videos whenever they wanted.
These developments marked the internet transition from Web 1.0 to Web 2.0, The Social Web. That is the version we currently have! Here are the other features brought by this version:
- Designed for the masses – Regular people could insert their comments, videos, and pictures into websites for the first time. Eventually, online services helped ordinary folks create and host websites.
- Owner-user communication – Internet users started leaving comments on websites, so their owners responded. This feature was a vast improvement from the read-only pages of Web 1.0.
- Dynamic Web – You can now buy products and services from the internet. Amazon has nearly every item you could think of, and you can shop until you drop on mobile apps.
- Profitable Web – Big corporations were not the only ones making it big on Web 2.0. For example, you could now work from home due to online apps. Alternatively, you could start a business from social media websites.
- Data-driven Web – The current version of the internet improves on the conventional business model via digital tools. For example, search engine optimization helps you gain more visitors to your website. You can even outsource the work to a digital marketing agency like LeadAdvisors.
Advantages of Web 3.0 over 1.0 and 2.0
We had a lengthy discussion about Web 3.0, but why is it better than the previous versions? There are several reasons, but they all bring the power of the internet back to the people.
Web 1.0 had websites owned by the wealthy few. Web 2.0 became more open for regular people, but massive tech firms still dominated the services.
Google is a great search engine, but it mines so much of your sensitive information. It has ads that supposedly cater to your needs, but the content comes from its affiliates.
Web 3.0 will expand the boundaries of what the internet can do for people. Let us talk about the specific ways this new internet will benefit your daily life:
- Modern ads on the internet show what companies want to sell you, not what you truly want or need. Web 3.0 will use AI to understand your behaviors to suggest more valuable products and services.
- Voice commands assistants like Cortana and Siri still struggle to understand all voice inputs. AI could help these apps comprehend human speech, while crypto networks could facilitate data analysis of other users. As a result, Web 3.0 voice assistants will have more functions, and they may even think like humans.
- Web3 may provide distinctive features. For example, GPS apps like Google Maps may provide traffic updates quicker, so you can immediately adjust to unexpected obstacles like roadworks or accidents.
Will Web 3.0 arrive soon?
This new version of the internet is not a specific product with an exact release date. Instead, it describes a phenomenon when we will have these tremendous benefits.
That is why we cannot say for sure when it will arrive. However, it will likely happen within a few years based on recent internet trends. You can see them by searching “Web 3.0 investment” on a search engine.
You will see several investment websites recommend ways to build a Web3 portfolio. They usually recommend buying shares from tech companies like those we mentioned.
What’s more, we currently use rudimentary versions of Web3 features. The previous list shows how the existing services compare with the upcoming Web3 iterations.
We have also discussed cryptocurrency, NFTs, and AI as essential components of Web 3.0. You will see that they continue to improve as time passes.
For example, it is easier to find someone who owns a crypto wallet nowadays. More folks even prefer digital coins over gold. Unlike bitcoin, you cannot spend them conveniently, yet they can also store value.
Tens of thousands of people in your area could be verifying transactions for cryptocurrencies. These digital assets gave rise to new services, providing people more control over personal finance.
Market data suggests that we may face an unprecedented global financial crisis, so more people pull their money out of their bank accounts. More importantly, they buy more cryptocurrencies.
The same goes for the NFT market. Despite its recent downturns, more companies are investing in digital tokens. NFTs are not just digital art; they can now be music and video files.
Artificial intelligence technology continues to advance. We have talked about how it helps modern cars drive themselves. Now, it can generate unique images based on text input.
Read More: The Ultimate Guide To Web 3.0
Should I invest in Web 3.0?
The technologies keep on improving, and companies keep on investing in them. However, is it good for you to invest in Web 3.0? Let us look at the pros and cons of this investment approach.
It is safe to say that people spend more time on the internet. We bring social media to nearly every moment of our lives as we post photos on Facebook and Twitter.
More people have internet access, and smartphones are more affordable nowadays. As a result, most people prefer buying stuff from a website instead of heading to a brick-and-mortar establishment.
We search for everything we need online, from products to jobs. Crucial facets of daily life intertwine with the internet, so they seem like extensions of each other.
Web 3.0 will unlock more possibilities for the internet to serve our needs. That is why investors look for Web3 projects nowadays. On the other hand, we should consider the offline factors that enable the online world.
Cryptocurrencies, NFTs, and the entire internet are energy-intensive technologies. Some experts say blockchains can rival the energy consumption of whole countries.
We are developing more environmentally friendly energy sources such as wind and solar. Unfortunately, the modern world still heavily relies on fossil fuels like crude oil and coal.
Transitioning away from these energy sources will take massive time and capital. Meanwhile, their prices continue to skyrocket due to dwindling supply and other external factors.
As a result, Web3 projects may become too expensive for regular people. Due to personal budget constraints, participating directly in these innovations might be impossible.
On the other hand, cryptocurrencies have been steadily becoming more green nowadays. Related costs like gas fees continue to decrease, making it more appealing to buy tokens.
Reading the factors from earlier may have complicated your investment decisions. That is because this article does not provide investment advice.
If you want to build a portfolio nowadays, consult a financial advisor. You may discuss how you can make the most profit from these digital trends.
No matter your thoughts regarding Web3 projects, one thing is clear. Technology will soon bring more changes to our lives, so it is best to learn all you can. Start by reading more Inquirer USA articles.
Frequently asked questions
What is Web3?
Web 3.0 or Web3 is the next major upgrade of the internet. It describes an internet that can understand human thought and behavior to serve people better.
What will Web 3.0 look like?
Web3 would look similar to the existing internet, except it has enhanced features. Also, you will find more people using VR technology to experience the benefits of the Metaverse.
Does Web 3.0 already exist?
At the time of writing, Web3 has not yet become a reality. Still, various companies and individuals are developing ways to realize this phenomenal technology.
Can I invest in Web3?
You can invest in Web 3.0 by investing in companies launching related projects, such as Samsung. On the other hand, you can buy cryptocurrencies and non-fungible tokens.
Is Web3 only Ethereum?
Web 3.0 describes various elements that will transform how we use the internet. It will not come from one company or crypto network. Instead, it will put together features from tech firms and cryptocurrencies.