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There are now three broad visions for the future of the internet. The first is a transformation into what Tim Berners-Lee calls “Web 3.0", a network that understands natural language and, depending on who you ask, will be open and ubiquitous, allow users to take back control from corporations and governments, and include billions of Things like sensors, robots and kitchen sinks. This vision is promoted by veterans and purists who believe that Big Tech’s dominance undermines open protocols that enable the internet, and also by many in the tech community who resent the market power of Google, Meta, Apple and Amazon.

For their part, the world’s biggest tech companies see that it will be harder to grow at the giddy rates they are used to, and sprawling across various sectors can only take them so far. That’s why Mark Zuckerberg is promoting the second vision, that of a “metaverse", an immersive 3-D virtual reality world where everyone will have to wear goggles to plug in. Beyond Meta (previously Facebook), Microsoft, Roblox and many other companies are throwing their weight behind this vision while trying to get to the head of the queue.

The story of the past two decades of Web 2.0 is not merely one of dominance by a few big technology companies and their proprietary platforms, but also one of increasing government power over the internet. Far from the 1990s’ view of a global commons that would promote individual freedom by circumventing the state, governments became even more powerful and very good at controlling every aspect of the internet. The third vision for the future originally sprang from a backlash against government control: peer-to-peer communications, blockchains, cryptocurrencies and ‘decentralized’ applications.

From a computer science perspective, the design of cryptocurrencies is clever and elegant, but massively wasteful. Never in the history of the world has so much computing power been wasted on so little as it has in the mining of Bitcoin.

Had it not been for loose monetary policies followed by Western central banks after the 2008 financial crisis, cryptocurrencies might have remained a fringe phenomenon. But when trillions of dollars slosh around the world looking for things to invest in, esoteric digital tulips created with mystic technology become an asset class. The phenomenal rise in the valuation of cryptos mixed with the formidable Silicon Valley storytelling machinery shaved off the initial capital and the trailing decimal to give us web3. In this vision, the future will be one of peer-to-peer networks, public ledgers, decentralized autonomous organizations, smart contracts and non-fungible tokens, all of which will not only overturn the internet, but also the world’s economic and political systems.

Both the metaverse and web3 appear far fetched. The phenomenal success of the internet and the web has been because of low barriers to entry.

When I sent my first email from my university in the early 1990s, I didn’t even know I was on the internet. Getting onto Web 1.0 was simple: I edited a text file and uploaded it onto a server. Getting onto Web 2.0 was simpler: My blog was up and running minutes after a friend told me about Blogger in 2000. I can’t get onto the metaverse though, because I don’t have the expensive goggles. I have not been able to get onto web3 either: the costs are steep and the sites rather confusing.

Of course, things will get simpler and cheaper, but while the transition from Web 1.0 to Web 2.0 was simple and inexpensive, the metaverse and web3 are cumbersome and demand payment. To the extent they grow and produce useful services, they will have a future, but I think it is somewhat of a stretch to claim that either of them will be the future. Besides, environmental considerations were not part of the design specifications of Bitcoin and many other cryptocurrencies. In a world that is trying to decarbonize, it will be difficult to justify wasteful power consumption and carbon footprints primarily for an ability to skirt the law.

Each of these three visions poses a different portfolio of challenges for public policy. Web 3.0 requires altering the balance between the state, the platform and the individual, while keeping an eye on the balance of power among states. The metaverse not only calls for preserving the integrity of the internet, but also demands the extension of governance into a different universe. With Web3, policymakers must be able to separate technologies from their applications, place things in the right categories, and be able to act on their judgement.

In a way, internet cycles are more like fashion than anything inherent in technology. A new generation of developers, entrepreneurs and venture capitalists has come of age, wants to make a fortune and is chafing against the status quo. The older generation must accept this and not get in the way. The younger lot must learn that not all regulations are pointless.

Every generation in every civilization sooner or later realizes that if someone refuses to deliver the promised goods or return your money, you need someone to call.

Nitin Pai is co-founder and director of The Takshashila Institution, an independent centre for research and education in public policy

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