The year 2021 was the year of digitalization, AI, autonomous cars, NFTs and cryptocurrencies development. Just a short recap: Elon Musk surpassed Jeff Bezos and became the richest man in the world. Dogecoin grew by almost 8 thousand percentage points and then fell again. Clubhouse was supposed to be a revolutionary VIP social network but it died as quickly as it rose to popularity. LinkedIn confirmed that data of about 500 million users were compromised during a huge hacking attack. Ransomware attacks became more frequent all over the world. Deepfake videos became mainstream. The artist Beeple sold one of his jpg images as a NFT for 69 million dollars. A bug in Tesla’s autonomous driving caused random braking. And, most importantly – the chip shortage became even worse when the Taiwanese company TSMC ran out of water, which made Playstation 5 consoles and GTX 300 series graphic cards, as well as all other technology based on 5nm chips, even harder to get. What awaits us in 2022?
Web 3.0 – the decentralized future of the internet
Web 3.0, the decentralized web, will become a place where all modern technology will converge into a single point. It should contain everything ranging from cloud computing, smart contracts, NFT, AI, VR, blockchain to no-code (visual programming). Even though a lot of people will consider Web 3.0 as just another hype that will pass or a place for NFT scams, it is basically a vision of a new internet era, where everything will be decentralized and controlled by users, not corporations. Everything will be regulated only via smart contracts and cryptocurrencies. It is basically an escape from today’s dystopia ruled by Google, Facebook, Amazon and Apple. Thanks to their difficult manipulation, for example media portals are supposed to be based on Web 3.0 to prevent the rise of totalitarianism similar to that in China. It will not be possible to censure or otherwise restrict the freedom of speech and it will not be possible to trace users and monetize their private data.
In decentralized applications, Dapps, the user owns all the rights to their data. Instead of a login name and password, users identify themselves using their blockchain wallets (or their public address for which they own a private seed). Today this type of identification is commonly done via browser addons, such as the Metamask wallet. The code of the application itself then lives on the blockchain in the form of a smart contract. It is different from classical client-server dynamics.
The question is whether the modern generation of people will appreciate free and decentralized platforms. They enjoy consuming the content of censored and highly monitored, mind-numbing social media such as TikTok, which doesn’t even deny that it sells data directly to the Chinese government.
The main part of Web 3.0 will consist of technologies that we will now discuss in more detail.
Metaverse and VR
Throughout 2022 and 2021, workplaces and offices underwent extensive digitalization due to the corona crises that suddenly required people to work remotely. Metaverse strives to speed up and expand this digitalization even further. So, what is the metaverse? It is defined as a “massively scaled and interoperable network of 3D virtual words rendered in real time that can be experienced synchronously and permanently by an unlimited number of people with an individual feeling of presence and data continuity, such as identity, history, authorizations, objects, communications and payments.”
In the past couple years, virtual reality (VR) became a trend not only in the gaming industry. Metaverse is going to use and develop VR to the fullest. In the upcoming 5 year, complete virtual worlds with their own economy will be created and will co-exist with the real world. Inside these metaverses the participants will carry out the same tasks as they do in real life, such as working, socializing, creating or playing games.
Mark Zuckeberg recently introduced one version of such metaverses. His idea consists of making online work meetings more “human”. It bothers him that during a meeting we have to look at a Zoom or Google Meet screen and he often gets people confused in large meetings when he only sees the participants in 2D, According to him, people shouldn’t experience these social interactions through a “glowing rectangle”, as we do now. “During a standard online meeting you only look at a grid of 2D faces on the screen and you only see them from shoulders up. This is not how we’re used to be experiencing reality. We are used to being together in a room, with spatial reality around us, where we remember who sits left and who is right of us. When someone speaks, for example, I know which direction it comes from,” said Mark.
According to Zuckberg, his version of the metaverse will strive to be like real-world teleportation. At one moment you might be working on virtual screens that you can carry with you anywhere thanks to virtual glasses, for example to a cafe or on a train, and the next moment you might be at a home theatre with your friends watching a new Matrix movie.
As I mentioned before, VR plays an important role and is an essential tool for connecting to the metaverse. John Carmack, the legendary creator of the first 3D gaming engine, games such as Doom and Quake, and the first VR set Oculus Rift, started working on VR technology directly for Zuckerberg (Oculus was purchased by Facebook in 2014). In 2019 he stepped down from the position of Oculus CTO and became only a consultant. He claims Zuckerberg’s approach to building a metaverse is wrong and it is necessary to start from the bottom, from the technology.
This is why John Carmack has more plans with VR. In the future he wants to develop a virtual reality that does not require wearing a VR headset but that connects directly do the human’s brain via a chip and then sends signals to create a visual response on the neuron level. This means that the user will not be able to distinguish actual reality from the virtual one. If this sounds to you like a nightmare from the Black Mirror TV show and something that goes completely against nature, we would like to note that we agree.
Carmack has a very twisted perception of the human mind. In an interview about VR he called himself a philosophical materialist, i.e., someone who sees the brain as a machine that produces consciousness and can therefore be modulated and components can be added to it. Of course, the whole vision of the metaverse and VR can also result in the easier manipulation of people. Facebook (Meta) will know absolutely everything about its users. Already now Facebook displays scarily targeted advertisements, seemingly for products even before you start considering buying them. Wouldn’t that be a perfect version of Orwell’s dystopian world of 1984?
However, this development is already inevitable. The year 2022 will mark the beginning of the metaverse world development. Zuckerberg believes that his vision should come true in within 5 years.
Ethereum 2.0, NFTs and NFT gaming
Cryptocurrencies, namely Ethereum, will also undergo massive development. They will finally switch to the Proof-of-Stake algorithm, which means Ethereum will become non-minable. This transition has been underway for years. The Merge is planned to take place at the end of the first and beginning of second quarter of 2022. The existing Mainnet will merge with the beacon chain - details about The Merge are available on the official website here. Just a sidenote - mining farms use not only ASIC chips but also new GTX 3000 series graphic card for mining. The most profitable currency for mining remains Ethereum, which is why I expect that after the transition to the non-minable version, these cards will at least partially return to circulation, when minders start to sell them and their price will finally get back to normal. If you’re planning to upgrade your PC, you might want to wait for a few months if you want to save some money.
Cryptocurrencies that continue to run on the “Proof-of-Work” algorithm, i.e., that can be mined and therefore consume large amounts of electricity, are continuously criticized by environmental activists. After The Merge, Ethereum 2.0 is expected to use 99% less electricity and hopefully its price will no longer be negatively affected by the media reports on global warming. Realistically, it will take months up to years after this change for people to stop associating Ethereum (and cryptocurrencies in general) with an environmental disaster and global warming. After The Merge, the network should also be several times faster. Ethereum currently supports 30 transactions per second, but after switching to version 2.0 it could support up to 100 thousand transactions per second. As a preparation to the transition from Proof-of-Work to Proof-of-Stake, starting on August 5 a part of Ethereum fees will be actively “burned” on the Ethereum blockchain. These fees are simply no longer credited to the miner’s account but are burned by being sent to the so-called eater address, which is basically a black hole that is not owned by anyone. This reduces the number of new ETH in the circulation and, subsequently, leads to deflation.
Another important consequence, in my opinion, will be the death of so-called “Ethereum-killers”. This what currencies like Solano, Cardano or Polkadot are called. Their main advantage is supposed to be low fees and faster transactions than with Ethereum. Since ETH is extremely popular and the network is congested by the NFT hype, the average “Layer 1” fee for a transaction is currently about 15 dollars, even if you’re sending for example 5 dollars. You can use “Layer 2” to get much lower fees. Increasing the throughput of the Ethereum 2.0 network should reduce these fees. The main argument of the above-mentioned currencies is the use of Proof-of-Stake, which is much more environmentally friendly. However, all these currencies will lose their advantage when Ethereum 2.0 arrives. There will be no reasons why these should be better than Ethereum. I personally see this as an arrogant Cain trying to kill his more noble brother Abel.
I wrote an article about NFTs, DeFi and NFT gaming in the October article and it seems my predictions about the failure of NFT gaming are coming true. The first example is the marketing fiasco of the long awaited (13 years to be specific) game Stalker 2. The publishers, GSC, announced in Twitter that the game will be integrated with NFTs, where it will be possible to buy a slot with an NPC metahuman character to immortalize your likeness in the game (in other words, scan a person into the game as a character for a cryptocurrency fee). However, GSC did not expect that this announcement will cause such an outrage in the fan community. For hundreds of thousands of players, the next instalment of Stalker was the last hope for a normal classical game without monetization in these hypercorrect times and the announcement of NFT integration crushed their hope. Dozens of thousands of upset gamers immediately unfollowed the GSC’s social media and cancelled their pre-order. The publisher immediately realized what a mistake they did and on the second day the withdrew their announcement and cancelled any integration with NFTs. The shared opinion of the community seems to be that NFTs and cryptocurrencies represent a threat for the environment. Of course, people fear what they don’t understand. As I described above, changes in the cryptocurrencies will guarantee low energy consumption. NFTs are a revolutionary concept that is unfortunately used for scams, which gives it a bad reputation.
Another example is Ubisoft Quartz, an NFT platform by Ubisoft. Immediately after the announcement, their trailer received 38k dislikes on YouTube - that was before Google started to censor the number of dislikes on YouTube to “create an inclusive and safe environment to protect smaller creators against hate.” Anyway, the public consensus is that NFTs in gaming only worsens the situation concerning microtransactions and Pay-To-Win games.
The year 2022 will therefore be the year of decentralization and fighting for the freedom of speech. Even though the metaverse might sound like a nightmare, it should be implemented in a decentralized system, or at least use cryptocurrencies in its ecosystem. Let’s hope NFT scams will pass and media will start to report positively about NFTs. Ethereum 2.0 will bring a revolution in the world of cryptocurrencies. Web 3.0 will be the main driver of this development. Those who manage to adapt and start to learn how to write applications for it and how to use its decentralization will be at the birth of a new era of the internet, where theoretically it will be impossible to censor anyone, where technological corporations won’t be more powerful than entire countries, where political correctness won’t be silenced, the responsibility of an individual will be developed, and the collective consciousness of humankind will move away from the threat of totalitarianism.