INDUSTRY CONNECTIONS

IEEE DECENTRALIZED METAVERSE INITIATIVE

GLOBAL WEB3 TECHNOLOGY

INDUSTRY ECOLOGICAL
DEVELOPMENT REPORT
REPORT

Authored by

Cheng Chi, Department Director, Senior Researcher, China Academy of Information and
Communications Technology
Daozhuang Lin, Chair, IEEE Decentralized Metaverse Initiative
Ramesh Ramadoss, Vice Chair, IEEE Decentralized Metaverse Initiative
Yu Yuan, Chair, IEEE Persistent Computing Initiative
Zihang Yin, Senior Researcher, China Academy of Information and Communications
Technology
Yuwen Zhang, Senior Researcher, China Academy of Information and Communications
Technology
Tongtong Cheng, Researcher, China Academy of Information and Communications
Technology
Wenqu Chen, Senior Researcher, China Academy of Information and Communications
Technology
Lingyuan Yin, Researcher, China Academy of Information and Communications Technology
Bin Yang, Professor, Tsinghua University
Ling Wei, Professor, Tsinghua University
Ralf Ma, Chair, IEEE P2048 Metaverse Working Group

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 ABSTRACT................................................................................................................................. 5

1. INTRODUCTION TO WEB3 .................................................................................................. 6

TABLE OF CONTENTS
1.1. REASONS FOR THE EMERGENCE OF WEB3................................................................ 6
1.2. TYPICAL FEATURES OF WEB3..................................................................................... 7
1.3. ECONOMIC SPACE OF WEB3 ..................................................................................... 8
1.4. SIGNIFICANCE OF WEB3 ............................................................................................ 9

2. TECHNICAL PERSPECTIVE: WEB3 PROTOCOL STACK AND KEY TECHNOLOGIES ............... 10

2.1. DIGITAL IDENTITY STANDARDIZATION .................................................................... 11
2.2. DIGITIZATION OF OBJECT ASSETS ............................................................................ 11

3. DEVELOPMENT PERSPECTIVE: WEB3 DEVELOPMENT FRAMEWORK AND CORE

ELEMENTS ......................................................................................................................... 12
3.1. INFRASTRUCTURE .................................................................................................... 12
3.2. COMPONENT TOOLS ............................................................................................... 13
3.3. USER ENTRY ............................................................................................................. 14
3.4. INTERACTION INTERFACES ...................................................................................... 14
3.5. DEPLOYMENT ENVIRONMENT................................................................................. 14

4. DEPLOYMENT PERSPECTIVE: WEB3’S IMPACT ON DIGITAL INFRASTRUCTURE................ 15

5. APPLICATION PERSPECTIVE: WEB3 APPLICATION PATTERNS AND TYPICAL

SCENARIOS........................................................................................................................ 15
5.1. FINANCIAL TECHNOLOGY: ESTABLISHING MULTIPARTY TRUST AND
ENHANCING ASSET CIRCULATION ........................................................................... 16
5.2. CONTENT CREATION: DERIVATIVE CREATION ECONOMY AND VALUE
REDISTRIBUTION...................................................................................................... 17
5.3. GAMING AND ENTERTAINMENT: BUILDING INTERACTIVE WORLDS,
REVOLUTIONIZING GAME RULES............................................................................. 18
5.4. CULTURAL AND CREATIVE: ACHIEVING DIGITAL OWNERSHIP, UNLEASHING
THE VALUE OF COLLECTIBLES .................................................................................. 18
5.5. SOCIAL PARADIGM: RESHAPING SOCIAL NETWORKS, FACILITATING
INFORMATION EXCHANGE ...................................................................................... 19

6. WEB3 EVOLUTION TRENDS AND CHALLENGES ................................................................ 20

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GLOBAL WEB3 TECHNOLOGY INDUSTRY
ECOLOGICAL DEVELOPMENT REPORT

ABSTRACT
Web3 was initially proposed by British computer scientist Tim Berners-Lee in 1998 to describe the concept of the
semantic web, which aims to make the internet more understanding of information itself and provide more
intelligent services to users. In 2014, Gavin Wood, co-founder of Ethereum, introduced a new concept of Web3,
hoping to start a new wave of digital economy based on blockchain, smart contracts, and other technologies.

This report believes that Web3 is not just a simple innovation at the application layer of the internet but a
comprehensive evolution and systematic upgrade of the internet architecture as a whole. The World Wide Web
(Web) provided a graphical and user-friendly interface for users to search and browse web pages, becoming the
first successful internet application worldwide. From a narrow perspective, during the Web1.0 era, users could
only passively browse web pages, while in the Web2.0 era, users relied on platforms to create and disseminate
information. In the Web3 era, users have more autonomy in managing data and can derive value from creating
internet content. From a broader perspective, Web3 aims to decentralize the internet and make it more secure
by designing new technical protocols and building new infrastructure. It allows users to have control over their
digital identities and assets, creating a truly data-centric economic system in the digital world. This integration of
technological and economic systems promotes the fusion of the digital economy and the physical economy
through collaborative innovation.

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1. INTRODUCTION TO WEB3

1.1. REASONS FOR THE EMERGENCE OF WEB3

Since the birth of the internet, with the development of Web technologies and applications, it has created digital
spaces and extended to form new expansions such as the Internet of Things, connected cars, and industrial
internet. High-speed transmission, network determinism, cloud-network integration, security and
trustworthiness, intelligent autonomy, and ubiquitous connectivity have become important directions for the
development of the next generation of the internet. As shown in FIGURE 1, Web2.0 provides rich interactions
between users and platforms and changes the transaction models between businesses and consumers, helping
to reduce production and transaction costs. Web3 begins to focus on technologies and models for enhancing
human–machine–object interactions, such as augmented reality and virtual reality. It seeks to strike a balance
between the efficiency of interactions on the internet and the fair distribution of user identity and data
management rights. This is achieved through consensus algorithms, smart contracts, encrypted communication,
and other technologies while exploring the realization of data value.

FIGURE 1 Main development directions of the internet and radar chart of Web1.0,
Web2.0, and Web3 implementation levels

Web3 provides new impetus by enriching network interaction protocols. As a global information transmission
network, the internet relies on foundational protocols like TCP/IP(Transmission Control Protocol/Internet
Protocol,TCP/IP) to help ensure the implementation of information transmission channels. However, these

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protocols lacked sufficient consideration for trust, security, and the value of data at their inception, resulting in
the inability to self-prove identity and verify information. Web3 expands the functionality of the protocol layer
through a “fat protocol” structure to support new technologies. Web3 promotes the circulation of data value
through the creator economy model. Web3 provides a more flexible value distribution model for organizations
and businesses, allowing network owners, content providers, and participants to be more involved in value
distribution, facilitating the circulation and market-oriented allocation of data elements. Web3 achieves
multiparty collaborative governance through algorithms and machine trust. Web3 emphasizes intrinsic
motivation and achieves data autonomous management by storing user data in a distributed network rather
than relying on a centralized service provider or specific server. This introduces a new mode of data autonomous
management and provides new ideas for digital governance.

1.2. TYPICAL FEATURES OF WEB3

Decentralization: Unlike Web1.0, which was content-centric and lacked network interaction, and Web2.0, which
revolved around centralized platforms providing data services, Web3 is a new type of network where all users
contribute, govern, and share value. Its core function is to build a user-centric distributed network ecosystem
that helps users engage in network interactions independent of platform institutions.

Machine Trust: Traditional internet lacks identity layer design, and the mechanism for network trust primarily
relies on centralized institutions to build network security infrastructure. This has led to issues such as identity
fraud and data theft. Web3 is a trust model built on consensus mechanisms and blockchain networks. By
redefining business protocols through smart contracts, Web3 combines distributed digital identities to
redistribute basic rights on the traditional internet, thereby constructing a network of trust among machines.

Creator Economy: In the traditional internet, there is an issue where tech giants control the majority of content-
sharing channels through their foundational platforms. The unequal distribution of benefits between platforms
and creators affects creative enthusiasm, and the creative economy market cannot be fully exploited. Web3
achieves the development of the creative economy by constructing a balanced collaborative mechanism among
platforms, creators, and users. With the help of blockchain incentive mechanisms and smart contracts, Web3
encourages platforms to redistribute value and rights to creators, thus stimulating the growth of the creative
economy.

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Native to the Digital Realm: Industrial digitalization mainly revolves around the deep integration of traditional
economy and digital technology, with the value system attached to the stock economy within the framework of
the traditional economy. However, this also limits the development vitality of the digital economy. Web3 creates
conditions for a self-circulating native digital value system, expanding economic activities into the virtual world.
It gives rise to digital-native application scenarios, represented by digital collectibles.

1.3. ECONOMIC SPACE OF WEB3

The economic space of Web3 refers to a collection of various economic activities that take place between user-
owned identities and data, mediated by digital assets and in the form of distributed applications. As shown in
FIGURE 2, the formation of the Web3 economic space stems from the issuance of digital tokens as value carriers
in the digital realm and the deployment of new protocols. It continuously expands and develops in a spiral
upward trajectory. The network value in Web3 comes from the block space provided by blockchain networks,
distributed to network developers, maintainers, and owners. The service value in Web3 comes from market
transactions facilitated by service protocols, which are allocated to business rule makers, liquidity providers,
original content creators, and protocol platform owners. The organizational value in Web3 comes from
governance rights generated by organizational structures, which are allocated to rule makers, proposal voters,
and organization owners.

FIGURE 2 Development logic of Web3 economic space

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 FIGURE 3 Value logic of Web3 economic space

As shown in FIGURE 3, the Web3 economy exhibits three core features. Web3 encourages collaborative
creation and sharing in the creator economy. The new protocols of Web3 applications establish rules that allow
anyone to participate in application scenarios based on transparency and openness, ensuring rights and
benefits for all participants and contributors within the ecosystem. Second, the accelerated value circulation
of digital assets and data within the Web3 ecosystem facilitates the rapid iteration of innovative applications
and aids in the development of distributed innovation. Third, the Web3 economic space breaks down
geographical boundaries in the online world, creating an open economic system through interoperable digital
identities and digital assets. This enables users, assets, and data to flow between different economic entities,
fostering continuous innovation in business models.

1.4. SIGNIFICANCE OF WEB3

First, Web3’s decentralized and trustless nature accelerates digital service expansion, boosts the physical
economy’s value, and drives enterprise digital transformation. In addition, its native digital and creative
economy characteristics enable self-circulating embedded value systems within virtual environments, leveraging
data resources as the primary production factor and continuously expanding the digitization market. Second,
participants collaboratively build decentralized and autonomous community organizations, reconstructing
production relationships, organizational governance, business competition, and value capture. The consensus
collaboration model, centered around users, focuses on constructing a human-centric, transparent, and secure
network architecture. By leveraging Web3’s technological innovation, industries transition faster and more
effectively into the digital native space, allowing people to reinterpret reality from a macro, holistic, and
transparent perspective. Third, Web3 stimulates market vitality and opens new prospects for digital economic
development. Market-driven development emphasizes Web3-related industries, leveraging competitive

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advantages and creating economic growth points. However, this model requires corresponding support and
regulatory measures to address potential security issues. Government-led development prioritizes the role of
state and government agencies, guiding Web3’s compliance through planning and policies. Fourth, Web3
reshapes data value and drives collaborative markets. It breaks down data silos, enhances data interoperability,
and shifts to a data owner-centric approach, empowering users with platform governance rights. This establishes
a collaborative and shared market, significantly enhancing the value of data applications and providing a
foundation for a new value internet system.

2. TECHNICAL PERSPECTIVE: WEB3

PROTOCOL STACK AND KEY
TECHNOLOGIES
As shown in FIGURE 4,Web3 initially formed a “four-layer, two-fusion” architecture, including the infrastructure
layer, the foundational layer, the scalability layer, and the application layer. Simultaneously, through the
interaction of digital identity standardization and the digitization of objects, a new system supporting the
integration and development of the physical and digital economies has been established. Among them, the
infrastructure layer (L0) adapts the logical rules of the protocol stack, reshaping the forms of computation,
storage, and communication, and driving the evolution of network architecture toward security, flexibility, and
scalability. The foundational layer (L1) constructs network trust rules that accommodate multiple participants,
enabling flexible resource scheduling and providing a trustless network operating system. The foundational layer
includes consensus, data distribution, and trusted transmission protocols. The consensus protocol serves as the
foundation for data distribution and trusted transmission protocols, thus providing a secure and trustworthy
validation mechanism for multiple participants and forming a collaborative network of trust. The extension layer
(L2) focuses on improving the operational performance and service scope of the foundational layer, promoting
the development of trust and value systems on the internet. The expansion layer includes cross-chain, scalability,
and transaction protocols, aiming to address the scalability bottleneck of consensus protocols, expand the
computational and storage capabilities of the underlying chains, enhance the service range and performance of
the foundational layer, and enable more participants to capture the value and contribute to the ecosystem. The
application layer (L3) integrates different fields, including finance, social media, gaming, and others, through
digital wallets as the gateway, fostering continuous innovation in application models.

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 FIGURE 4 Protocol stack and key technologies of Web3

2.1. DIGITAL IDENTITY STANDARDIZATION

Digital identity standardization drives the transition of network entity resources’ identity from being hosted to
self-managed. Digital identity refers to encoding real-world user identities and attribute information into
machine-readable information through digital means, allowing user identities to be recognized and queried in
cyberspace. The evolution of digital identity models has progressed from “centralized” to “federated” and then
to “decentralized.” Centralized and federated digital identities have limitations in terms of interoperability,
portability, identity autonomy, and security and privacy. By digitizing and managing digital identity through
distributed networks, the registration, verification, and authorization of network entity resource identities no
longer depend on centralized platforms. This helps to ensure the transfer of data usage rights based on verifying
users’ control over their identity credentials, all while maintaining security and trust. Currently, in the realm of
Web3 digital identity, distributed identifiers have emerged as the mainstream solution, yet they have not gained
widespread application.

2.2. DIGITIZATION OF OBJECT ASSETS

The digitization of object assets is the foundation for promoting data circulation and market-based allocation of
data elements. Digital objects refer to objects that exist or are represented in digital format, and digital assets
are the representation of rights associated with digital objects. The infrastructure development and industry
exploration of digitizing object assets are extensive, but standards have not yet been established. In terms of

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standards, according to data from the well-known digital asset information website CoinMarketCap, there are
currently more than 20,255 types of digital assets, with some conforming to Ethereum standard protocols (such
as ERC-20, ERC-721, and ERC-1155), and others adhering to custom protocols (such as Bitcoin, Ethereum, etc.).

3. DEVELOPMENT PERSPECTIVE: WEB3

DEVELOPMENT FRAMEWORK AND CORE
ELEMENTS
As shown in FIGURE 5, Web3 decentralized applications are developed using a framework consisting of five core
elements: infrastructure, component tools, user interfaces, user gateways, and deployment environments.

FIGURE 5 Protocol stack and key technologies of Web3

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3.1. INFRASTRUCTURE
The infrastructure comprises a distributed underlying network consisting of multiple blockchain systems,
allowing for the exchange of data, information, and control instructions between different systems through
cross-chain protocols or extension protocols. For developers, the main components of infrastructure include
smart contracts and virtual machines. Smart contracts are logic rule codes that run on the blockchain. They
utilize predefined logical conditions set on the chain to determine contract execution conditions and write the
resulting changes to the ledger. No party can individually control or stop the execution of the program. Virtual
machines provide on-chain code execution environments, and block space becomes a scalability bottleneck. The
virtual machine provides a blockchain-readable and writable runtime environment for code such as smart
contracts. As Web3 applications continue to grow in popularity, the demand for on-chain data storage and logic
processing is increasing. The block space resources of most blockchain systems are tight, leading to issues such
as high transaction fees and delayed transaction confirmations. Expanding the block space using scalability
solutions is the main solution to address this bottleneck. The current mainstream scalability solutions include
sidechains, shared networks, as well as L2 layer solutions like ZK-Rollup and Optimistic-Rollup.

3.2. COMPONENT TOOLS

Component tools act as a bridge between upper layer applications and the underlying infrastructure, with node
management services being a crucial component. They mainly include node hosting tools, data management
tools, and security assurance tools. Node hosting tools simplify the underlying complexity of upper layer
application development but come with centralized control risks. By providing development toolkits, data
interfaces, and other services for direct interaction with the underlying blockchain system, node hosting
component tools allow upper layer application developers to focus less on managing the underlying node
network, facilitating convenient development processes. Data management component tools provide auxiliary
functions for data monitoring and analysis, serving both development and application purposes. These tools
include querying on-chain data, retrieving content data, and performing statistical analysis. Data management
tools are widely used in Web3 application development and user exploration of the Web3 ecosystem. Security
assurance component tools establish a common foundation for identity and asset management to protect asset
and data security. Security assurance tools include key management, code auditing, privacy control, and more.

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3.3. USER ENTRY
User interfaces determine the presentation of Web3 applications and are implemented through Web3 front-
end frameworks. User gateways serve as entry points to the Web3 ecosystem, allowing users to interact with
Web3 applications using digital wallets for identity authentication and signature. The main form of user entry is
through digital wallets. Digital wallets have evolved from single-function wallets that store public and private
keys for encrypted asset management to versatile interfaces supporting multichain interactions, user identity
management, and data information. Digital wallets integrate various applications and data resources, and the
development of universal open-source protocols is crucial. The position of digital wallets continues to rise, and
regardless of future economic development models, they play an indispensable role on the access side.

3.4. INTERACTION INTERFACES

Interaction interfaces are the visual displays through which users interact with Web3 applications. Their purpose
is to enhance the interactive capabilities of Web3 applications and improve the user experience. For developers,
the core elements of interaction interface development mainly involve front-end programming languages and
front-end libraries. Front-end programming languages remain largely unchanged, while front-end frameworks
focus more on the universality of user experience. The majority of front-end development languages for Web3
decentralized applications revolve around JavaScript, HTML, and CSS, along with front-end development
frameworks such as React and Vue, to help ensure consistency between Web3 and Web2.0 application
experiences and reduce the educational costs associated with changes in user habits. Front-end libraries have
seen scalable growth driven by active application development, adding encapsulations of underlying chain
interaction interfaces. Front-end libraries like Web3.js and Hyperledger.js, which encapsulate underlying chain
interaction interfaces, are widely used in Web3 front-end development.

3.5. DEPLOYMENT ENVIRONMENT

Deployment environments encompass code hosting and content storage environments, including local setups,
cloud services, and distributed storage systems, facilitating the deployment of user gateways, user interfaces,
and component tools. Deployment environments mainly include local deployment, cloud services, and
distributed network deployment environments. Local or distributed networks are advantageous for ensuring
data sovereignty; however, resource management can be more complex. Cloud platform hosting solutions
remain the mainstream choice, with cloud service providers actively providing support. Considering the

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convenience of access, most Web3 applications currently use cloud services to host page code and store data
content for user entry points, interaction interfaces, and component tools.

4. DEPLOYMENT PERSPECTIVE: WEB3’S

IMPACT ON DIGITAL INFRASTRUCTURE
Web3 will build a new generation of communication networks that rely on blockchain-based trust infrastructure,
trustworthy network gateways through digital wallets, authentication systems based on digital identities, and
applications for managing the circulation of digital assets. This will create a “data-driven, self-governed,
distributed interconnected, and secure and trusted” network. The internet has long suffered from issues such
as data authorization, ownership, and authentication, leading to low efficiency in data circulation and the
inability to effectively realize the value of data. As shown in FIGURE 6, Web3 can effectively define data
ownership relationships, fairly share data profits, and avoid the creation of value distribution models centered
around intermediaries. Therefore, it drives the construction of trusted collaborative networks based on
blockchain, providing efficient, universal, and end-to-end data interaction capabilities, thus influencing the
deployment model of the entire communication network.

FIGURE 6 Comparison of Web2.0 deployment architecture and Web3 deployment

architecture

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5. APPLICATION PERSPECTIVE: WEB3
APPLICATION PATTERNS AND TYPICAL
SCENARIOS
The core concept of Web3 decentralized applications revolves around data-driven value distribution and value
flow. Its application patterns are supported by blockchain technology, which ensures the attribution of data
rights. As shown in FIGURE 7, the system operating rules driven by smart contracts enable all data contributions
within the application ecosystem to capture value in the form of digital assets, ultimately forming a value loop
from data monetization and asset tokenization to asset circulation.

Specific Web3 application patterns in different industry backgrounds may emphasize different aspects; however,
they are all distributed applications built on smart contracts and supported by distributed networks, distributed
databases, distributed storage, distributed computing, distributed ledgers, and distributed governance. They
adhere to open-source and open technology frameworks, transparent and co-governance mechanisms, and
collaborative and shared benefit distribution as the three core characteristics.

FIGURE 7 Value closed loop of Web3 distributed application mode

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5.1. FINANCIAL TECHNOLOGY: ESTABLISHING
MULTIPARTY TRUST AND ENHANCING ASSET
CIRCULATION
Decentralized finance (DeFi) is a mature application scenario of Web3 in the field of financial technology, mainly
comprising two financial application patterns: decentralized trading and decentralized lending. Unlike
centralized financial models, in DeFi, users do not need to entrust their funds to third-party trading platforms.
Instead, funds are held in liquidity pools created by smart contracts, and asset exchanges are automatically
executed according to the agreed-upon protocols in FIGURE 8. The current total value of the DeFi market stands
at U.S. $78 billion, with a peak surpassing U.S. $250 billion.

FIGURE 8 Comparison of Web2.0 and Web3 financial models

5.2. CONTENT CREATION: DERIVATIVE CREATION

ECONOMY AND VALUE REDISTRIBUTION
As shown in FIGURE 9, Web3 content creation provides users a fast way to create decentralized autonomous
organizations. Web3 creators have ownership of their content and tokenize it to establish clear ownership and
benefit distribution models. This supports high-quality content creation and forms a virtuous cycle for the
growth of the creative application ecosystem. Web3 redefines the way content is created, which is significant in
breaking the heavy reliance of traditional content creators on third-party platforms, limited creator earnings,
and low-quality content. It has become the best practice for the ownership economy. Common Web3 content
creation models include creators publishing content through creation platforms, creators minting content as
NFTs(Non-Fungible Tokens, NFTs) for sale, and creators using social token issuance platforms to reward content.

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 FIGURE 9 Comparison of Web2.0 and Web3 content creation modes

5.3. GAMING AND ENTERTAINMENT: BUILDING

INTERACTIVE WORLDS AND
REVOLUTIONIZING GAME RULES
As shown in FIGURE 10, Web3 gaming refers to games developed on blockchain that combine interactive gaming
experiences with DeFi. Web3 games transfer asset ownership, creative rights, and governance rights to players
rather than centralized gaming companies, bringing greater fairness and openness to the gaming industry. In
Web3 games, the profits derived from asset appreciation are collectively owned by players, game publishers,
and token holders. Game publishers no longer exclusively enjoy game revenue but instead earn taxes from the
activity within the in-game economy. Players, as important participants in the gaming ecosystem, not only obtain
entertainment value but also hold assets with potential value appreciation.

FIGURE 10 Comparison of Web2.0 and Web3 games and traditional game modes

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5.4. CULTURAL AND CREATIVE: ACHIEVING
DIGITAL OWNERSHIP AND UNLEASHING THE
VALUE OF COLLECTIBLES
NFTs are unique digital certificates generated using blockchain technology for cultural and creative works. As
shown in FIGURE 11, they enable genuine and trusted digital issuance, purchase, collection, and utilization of
creative works while protecting their digital copyrights. This transformation allows cultural creations to become
innovative applications with clear rights, publicly transparent transactions, and fair and equitable distribution of
benefits. Web3 achieves this by storing ownership information and transaction records of cultural and creative
works on decentralized blockchain networks, enabling creators and IP owners to easily establish ownership
rights. Smart contracts and cryptographic technology ensure secure access and transmission of NFTs,
guaranteeing that creators and owners can benefit throughout the entire lifecycle of the works. This creates a
new value distribution model for the ownership economy and builds a new cultural and creative ecosystem.

FIGURE 11 NFTs business model

5.5. SOCIAL PARADIGM: RESHAPING SOCIAL

NETWORKS AND FACILITATING
INFORMATION EXCHANGE
The core of Web3 social is the reconstruction of a decentralized and verifiable social graph, addressing the
problems of noninteroperability and platform monopolization of user information in current social modes in
FIGURE 12. On one hand, Web3 social establishes a new data network ecosystem. Users can own their data, and
developers can seamlessly combine applications, promoting large-scale collaboration among developers and
creating a global data network effect between users and developers. On the other hand, users have true

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ownership of a portable social graph, allowing them to switch network services without losing any interpersonal
relationship data. This is one of the core public services provided by Web3 and the best way to ensure the
smooth operation of social services.

FIGURE 12 Web3 social business model

6. WEB3 EVOLUTION TRENDS AND

CHALLENGES
The development concept of Web3 will gradually become clear, avoiding excessive conceptualization or
technological bias. Currently, Web3 is still in its early stages of development. Some initiators attempt to address
existing problems of the internet from the perspectives of decentralized infrastructure and distributed digital
identity. Others explore new applications and models native to the digital realm, such as digital assets and smart
contracts. In addition, influenced by the rapid development of next-generation technologies like blockchain,
artificial intelligence, and virtual reality, the concept of Web3 has expanded to encompass broader domains,
such as full immersion and digital twinning. However, as Web3 technologies and industries mature, practitioners
and participants will gradually focus on defining clear development concepts and evolutionary paths.

The Web3 technology protocol stack is still evolving, with a focus on unified standards and product development.
Just as core technological standards like the HTTP protocol and URI identifiers were pivotal during the early days
of the web, underlying blockchain infrastructure like Ethereum has played a significant role in constructing a
distributed trust network for Web3. Similarly, decentralized identifier (DID) technology solutions are
approaching the status of de facto standards for Web3 digital identities. In a rapidly developing system like
Web3, unified standards, and products will receive significant attention from industry and academia, attracting
more researchers and application practitioners and leading to cumulative advantages.

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Web3 enables the trusted management and tokenization of data elements, facilitating data ownership,
transactions, and circulation. This capability opens up numerous digitally native application scenarios, promoting
the integration of the physical and digital economies. Furthermore, the Web3 industry ecosystem requires new
perspectives, and multiple stakeholders are engaging in comprehensive layouts. Web3 regulation faces
numerous challenges, necessitating simultaneous technical advancements and regulatory safeguards.
Governments and international governance platforms are conducting forward-looking research to identify
appropriate governance mechanisms and regulatory safeguards. Through initiatives like pilot zones, they are
exploring the construction of comprehensive, multilevel, and 3-D regulatory and governance systems, as well as
technological means, to ensure the healthy development of Web3 technologies and industries.

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 RAISING THE WORLD’S
STANDARDS

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Tel.+1732-981-0060 Fax+1732-562-1571

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