Web5: The Next Decentralized Web

Web5 is a term coined by former Twitter CEO Jack Dorsey to describe his vision for a decentralized internet that leverages Bitcoin to give users full control over their data and identity. Web5 aims to address the shortcomings of Web3, which Dorsey criticizes for being too centralized, tokenized, and reliant on smart contracts. In this article, we will explore what Web5 is, how it works, and what are its advantages and challenges.

What Is Web5?

Web5 is a decentralized, peer-to-peer version of the web built exclusively on a second layer of the Bitcoin blockchain, called the Lightning Network. The Lightning Network is a payment protocol that enables fast and cheap transactions without congesting the main Bitcoin network. Web5 uses this protocol to create a network of decentralized web nodes (DWNs) that allow users to store and manage their own data without intermediaries.

Web5's mission is to create an online system that is resistant to the influence and censorship of Big Tech companies, and to truly secure personal data by restoring the ownership 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. However, unlike Web3, which stores data on public network solutions like Filecoin or IPFS, Web5 lets users store and control their own data with DWNs. Web5 also does not use smart contracts or tokens to function like Web3 does.

How Does Web5 Work?

Web5 leverages the Bitcoin Lightning Network to create a peer-to-peer infrastructure of personal servers that can run decentralized web applications (DWAs). A DWA is an application that uses decentralized identifiers (DIDs) and verifiable credentials (VCs) to offer only two use cases: data sovereignty and full control over this data.

A DID is a unique identifier that represents a user's identity on the web. A DID is not controlled by any central authority, but by the user themselves. A VC is a digital document that proves some attribute or claim about a user's identity, such as their name, age, or email address. A VC is also not issued by any central authority, but by the user themselves or by other trusted entities.

A DWA allows users to create and manage their own DIDs and VCs, and to store them on their own DWNs. A DWN is a personal server that runs on the Lightning Network and acts as a storage provider for the user's data. A DWN can also communicate with other DWNs to exchange data or verify credentials. A DWN is not dependent on any base blockchain network or consensus mechanism, but only on the Bitcoin network for security and settlement.

What Are the Advantages and Challenges of Web5?

Web5 offers several advantages over Web3 and Web2 in terms of data privacy, security, and sovereignty. Web5 gives users full control over their data and identity, without relying on any intermediaries or third parties. Web5 also reduces the costs and complexity of running decentralized applications, by eliminating the need for tokens, gas fees, smart contracts, or validators. Web5 also leverages the Bitcoin network, which is the most secure and widely adopted blockchain in the world.

However, Web5 also faces some challenges and limitations that need to be addressed. Web5 is still in its early stages of development, and there are not many DWAs or DWNs available yet. Web5 also requires users to have some technical knowledge and skills to set up and maintain their own DWNs. Web5 also relies on the Lightning Network, which is still experimental and has some scalability and usability issues. Moreover, Web5 may face some regulatory and legal hurdles, as it challenges the existing models of data governance and ownership.