London Daily

Focus on the big picture.
Monday, Nov 02, 2026

What should we really expect from Web3, DeFi, and the future of the internet?

What should we really expect from Web3, DeFi, and the future of the internet?

The gist is familiar from revolutionary statements throughout history. Wrest power from the establishment, return it to the people, make everyone happier and richer along the way.

Take a moment and think of everything wrong with the online world, from data breaches to violations of privacy to the overweening power of big tech.

Then imagine them disappearing. Gone. Just like that.

Sounds appealing? Well, you've just heard the first line of a sales pitch-cum-revolutionary manifesto that's gaining traction in San Francisco and Washington DC. It goes by the name of web3.

The gist is familiar from revolutionary statements throughout history. Wrest power from the establishment, return it to the people, make everyone happier and richer along the way.

The tools we're told can achieve this are as modern as it gets. The heart of the plan is to rebuild the foundations of the web using the blockchain technology that underpins cryptocurrencies such as Bitcoin.

According to Web3's backers, it is possible to take anything - or, indeed, everything - that is online and put it on the blockchain, the energy-intensive ledger which enables data to be stored collectively without the need for a central record-keeper.

Do this, the theory goes, and you wouldn't just give everyone back their data, you would give them their freedom.

Instead of Facebook or Google owning all our photos, posts and likes and deciding how we get to use or access them, we would own our own information and have a say in how it's used.

That's not just because we would be able to remove our data securely and easily in a digital wallet, but also because the mechanics of the blockchain enable new forms of coordination.

Anyone who uses an internet service can be given a token granting them rights to control how the service is used. Because the token is digital, its rules can be encoded into it - and because the blockchain can't be altered by a central power, those rules are permanent until and unless every token holder agrees they should be changed.

Imagine a world in which WhatsApp and TikTok were more like John Lewis or the trade union Unite, organisations in which the members have a say, potentially even to the point of sharing some of those vast profits.

If you're a blockchain true believer, that is just the start. The term Web3 refers to the third generation of the web, after the static "read-only" Web 1.0 and the read-and-write Web 2.0 exemplified by social media, but as so much of life is online now, it's possible to imagine it revolutionising nearly anything. Why shouldn't local governments be democratised in the same way? Or art? Or banking?

If you are starting to raise an eyebrow at this point, you are not alone. Even if you suspend disbelief and accept that such a grand project can be built on the same rickety blockchain technology which couldn't process a bitcoin transaction this time last year in less than seven hours, there are plenty of reasons to be suspicious.

Many observers have pointed out that this supposed revolution is being pushed by one of the biggest venture capital firms in Silicon Valley, with vocal support from executives at Meta.

That's right: the bonfire of big tech is being hailed by the company formerly known as Facebook. Hardly a precursor of radical reform.

Executives at Meta are big supporters of Web3


Revolutionaries have always been accused of hypocrisy, so this is not necessarily an objection in its own right, but it is worth bearing in mind when it turns out that Web3 is already failing to live up to its promises.

For all the talk of decentralisation, much of the emerging technical infrastructure of Web3 is in fact as centralised as its predecessor. It turns out that even when it's theoretically possible to give everyone a stake or say, it's practically simpler to leave it up to a small group.

None of this will come as a surprise to anyone familiar with online history. Twenty years ago the model for the exciting new web was Wikipedia, the first encyclopaedia written by the crowd. Many people confidently predicted that Web 2.0 would be built in Wikipedia's image. Instead, as the years passed, it turned out to be the exception rather than the rule.

Arguably even Wikipedia is effectively centralised, as it relies on a small group of volunteers to keep its articles up-to-date and free from argument. Nor, for all its brilliance, is it as perfectly reliable as we need something like legislation or finance to be.

Perhaps blockchain technology will change this by adding money to the mix, making it possible for contributors or volunteers to be paid for their work. (Although incentivising Wikipedia contributors to make changes to articles would bring its own set of problems.) But it will not be easy.

Even at this early stage, Web3 companies are encountering the kind of challenges all too familiar from the old world of social media. One of the most popular platforms for NFT art, OpenSea, is currently wrestling with the related problems of plagiarism and spam.

Normally those issues are dealt with by a central authority, but that's not very democratic, at least not in the way that web3 fans define democracy. So what should OpenSea do? Stay "free" or allow rampant plagiarism?

That's a simple question compared to the conundrums faced by a social network such as Facebook. Imagine a web3-style "vote" on whether to take down the livestream of a mass shooter playing out while the shooting is taking place. The mind boggles - and not in a good way.

Of course, many of the people rushing headlong towards web3 aren't interested in these debates. They're there for the novelty, the social cache, and also - of course - the money.

In the end, so much of web3 comes back to money. From its roots in bitcoin to the current hype over NFTs, it has been marked by a desire for cold hard (digital) cash. Even its most interesting innovation, the decentralised autonomous organisation, or DAO, is first and foremost a way of raising funds.

Being concerned with money isn't necessarily a bad thing. The open source movement behind Web 2.0 disdained questions about how exactly anyone would get paid, as did many of the contributors to the early 2000s blogosphere, then ran into financial difficulties while others got rich from their work. Money matters. But the way it matters to web3 means that most of its immediate impacts are likely to be in the area of online finance.

In that sense, web3 is the high-tech equivalent of the "big bang" of the 1980s, during which nationalised industries were sold on newly deregulated financial markets.

Back then, boosters sold the dream of a new "shareholder democracy", where ordinary citizens would influence the behaviour of the most powerful corporations in the world.

Looking back, that seems wildly optimistic - but the big bang did change history. It brought in a new class of freshly-minted millionaires, a wild up-and-down boom, and, most enduringly, a new economy built on ever more complicated forms of finance.

If it comes to pass, web3 is much more likely to be a financialised internet than a democratised one. That means more scams, more rags-to-riches stories and more volatility. Get ready, it's going to be wild.

Newsletter

Related Articles

0:00
0:00
Close
House of Lords Begins Detailed Legislative Scrutiny of Representation of the People Bill and Cyber Security Laws
Metropolitan Police Detain More Than Three Hundred Individuals Following Large-Scale Demonstration Outside London Embassy
Home Office Prepares Stricter Residency Rules Requiring Vulnerable Migrants to Wait Decade for Settlement Rights
Professional Mental Health Bodies Demand Statutory Regulation for Counsellors and Psychotherapists
National Grid Confirms Construction of Britain's Largest Electrical Substation to Power Teesside Data Centre
Prime Minister Keir Starmer Travels to Samoa for Commonwealth Summit Amid Debates on Economic Cooperation and Reparations
Home Office Implements Enhanced Digital Border Controls and Visa Processing Systems at Major Airports
Office for National Statistics Reports Stable Employment Participation Rates Across Regional Labor Markets
Department for Business and Trade Announces Strategic Partnership to Secure Critical Mineral Supply Chains
Scottish Government Unveils Regional Economic Development Strategy to Boost Advanced Manufacturing in Glasgow and Dundee
Treasury Officials Review Taxation Frameworks and Capital Gains Rules Ahead of Autumn Budget Disclosures
National Health Service Leaders Warn of Winter Capacity Pressures Across Acute Care Facilities
Bank of England Prepares for Key Interest Rate Decision Amid Sticky Inflation and Fiscal Policy Pressures
Home Office Expands Border Security Operations and Intelligence Sharing With European Partners
Office for National Statistics Reports Modest Retail Sales Growth Ahead of Crucial Christmas Trading Season
Welsh Government Unveils Strategic Plan to Boost Regional Technology Innovation and Digital Skills Training
Department for Environment Food and Rural Affairs Implements New Agricultural Subsidies Framework for English Farmers
Scottish First Minister John Swinney Announces Major Regional Infrastructure and Green Energy Investment Strategy
National Health Service Leaders Warn of Severe Winter Pressures and Mounting Accident and Emergency Backlogs
Bank of England Monetary Policy Committee Signals Cautious Interest Rate Path Amid Persistent Services Inflation
Chancellor of the Exchequer Rachel Reeves Finalizes Autumn Budget Framework Aiming to Close Public Sector Fiscal Gap
Department for Science, Innovation and Technology Prepares Enhanced Artificial Intelligence Safety and Cyber Defense Frameworks
United Kingdom Government Expands International Sanctions Framework Against Russian Shadow Fleet and Financial Enablers
Institute of Directors Reports Sharp Post-Budget Drop in Business Confidence Despite Long-Term Investment Intention Shifts
Chancellor John Healey Defends Sweeping Fiscal Adjustments and Household Support Packages Following Autumn Budget
Parliamentary Petitions Committee Schedules Major Legislative Debates on Special Educational Needs and Non-Stun Meat Labelling
Regional Devolution and Good Growth Fund Frameworks Reshape Local Government Funding Across English Regions
Loughborough University Economic Analysts Highlight Substantial Uncertainty Surrounding Public Sector Efficiency Savings
British Legal Sector Drives Sixty Billion Pounds in Annual Economic Output While Employing Over Half a Million Professionals
Law Society Welcomes New Better Regulation Executive While Pressing for Long-Term Legal Aid Funding Reform
Metropolitan Police and Security Services Heighten Operations Across London Ahead of Large-Scale Public Demonstrations
Bank of England Economists Scrutinize Corporate Tax Adjustments and Public Sector Borrowing Pressures
Chancellor John Healey Defends Autumn Budget Tax and Spending Allocations Following Intense Parliamentary Scrutiny
Department for Environment, Food and Rural Affairs Implements Strict Water Quality Monitoring Rules Following Severe Rainfall and Flooding
Welsh Government Unveils Comprehensive Regional Housing Strategy to Address Rural Affordability and Homelessness Pressures in Cardiff
Office for National Statistics Reports Slowing Consumer Price Inflation and Steady Retail Performance Across United Kingdom Markets
Northern Ireland First Minister Michelle O'Neill and Deputy First Minister Emma Little-Pengelly Advance Cross-Border Infrastructure Agreement in Belfast
Competition and Markets Authority Launches Formal Investigation Into Artificial Intelligence Partnerships Involving Major Technology Corporations
Scottish First Minister John Swinney Secures Cross-Party Support for Devolved Budget Framework and Renewable Energy Expansion
High Court Rules in Favor of Environmental Campaigners Over Department for Energy Security and Net Zero Licensing Procedures
National Health Service England Announces Major Digital Modernization and Artificial Intelligence Diagnostic Rollout Across Regional Trusts
Bank of England Monetary Policy Committee Signals Cautious Approach to Interest Rate Cuts Amid Persistent Wage Growth and Inflation Pressures
British Prime Minister Keir Starmer and Chancellor Rachel Reeves Outline Strategic Infrastructure Plans to Boost Regional Growth and Private Investment
Water pollution remains high despite £5bn investment
Regional Economic Divergence and Industrial Transformation
Technological Sovereignty and Regulatory Scrutiny
Fiscal Consolidation and Public Service Pressures
Automotive Industry Leadership Warns of Imminent Supply Chain Disruptions Following Recent European Trade Negotiations
High Court Delivers Landmark Ruling Affirming Strict Legal Protections for Corporate Data Privacy Against State Surveillance
Welsh First Minister Eluned Morgan Secures Additional Funding for Regional Transport Infrastructure and Rail Modernization
×