Thought Leadership

Web3 And e-Me: Navigating The Era Of Digital Identity And Finance

Written by Contributing Writer, Lawrence Wintermeyer, Co-Founder & Principal, Elipses

The next generation of the World Wide Web, web3, is afoot with great fanfare from technology developers and futurists, and with great skepticism from hardnosed detractors and cynics. I am not a big fan of technology predictions in either direction, though I would counsel betting against well capitalized, bright, and motivated technologists and their innovative plans that often consign today’s technology to the great technology garbage patch.

Two of my favorite technology predictions from the past are:

“By 2005, it will become clear that the Internet’s impact on the economy would be no greater than fax machines,” Paul Krugman, economist, 1998, and,

“I think there is a world market for maybe five computers,” Thomas Watson, chairman of IBM, 1943.

Beyond economists, technologists often get it wrong. Xerox, and its Palo Alto Research Centre (PARC), invented widows and the mouse, both capitalized on by Apple and Microsoft, consigning its flagship photocopier and fax machine to tech history. IBM went on to become an enterprise technology giant by the 1970s but missed the big shift to personal computer software in their deal with Microsoft and the PC in the 1980s.

In any event, it is worth paying attention to technology and the web3 space, whatever leadership role you aspire to. Following the smart money in the West Coast’s venture capital community is one way to stay abreast of web3 developments.

Vantage Market Research has estimated in a recent report that the blockchain and web3 market will be worth $23 billion by 2028 growing at an annual compound rate of 41.6 percent between 2022 and 2028. Notably blockchain and web3 are becoming inter-related terms and the report cites that improved privacy and secure networks are the big benefits that will drive this growth.

According to Accenture’s “State of Cybersecurity Resilience 2021″ report, cybercrime rose by 31 percent from 2020 to 2021. reports several alarming statistics including, “59 percent of Americans report they have experienced cyber crime or in some way fallen into the hands of a computer hacker.” Web3 is just not going to scale unless security for citizens and business is dramatically improved.

It is hard to believe that web3, or at least the term, is eight years old. Coined in 2014 by Gavin Wood, the founder of Polkadot, a distributed ledger technology (DLT) and 33 years following Tim Berner Lee’s World Wide Web, web3’s ubiquity was achieved rapidly during the peak of the hot crypto and blockchain technology market in 2020-21 and was aided by the great re-branding of Facebook to Meta, signaling the tech giant’s great strategic pivot.

In the beginning there was Berner-Lee’s web1, a semantic text based digital exchange for research papers, documents, and computer code that was shared across academic networks. This was the era of “The Community”, linking everyone from universities to gamers on forums, and message and discussion boards. People exchanged views on everything from tech: devices; coding, and gaming; to sports and politics. The growth of “chat rooms” was accelerated in web1 by Compuserve and AOL, all offering you access to the internet, and the era’s killer app, e-mail.  

Next came web2, “The Platform”, which monetized “The Community” by enabling payments, and heralding in the era of on-line shopping and payments – creating giants like Amazon, e-Bay and PayPal, and era’s killer app, e-commerce. Platforms like Google for search and Facebook for social media, arguably two additional web2 killer apps, took e-commerce one step further and used “surveillance capitalism” to monetize The Community, offering you free access to their walled garden platforms, and selling your data to advertisers without your consent. iPhone and Android apps permanently connected you to the internet and accelerated the era of monetization and surveillance capital extending your data footprint with location data and 24/7 usage patterns.

The development of web3, and make no mistake, it is currently in the earlier stages of development, will herald in the world of “The Networks”. Some networks, or protocols as they are often referred to, are decentralized and public, like the Blockchain, Ethereum or private like Hyperledger Fabric and R3, and have various degrees of de-centralized and open-source features. The importance of web3 networks is that they put you, the user of the network, “e-me”, at the center of the platform to participate in shared incentives and personal data sharing at your discretion. The killer app here is e-identity, you’re digital e-me doppelganger.   

The digital identity race has begun with Apple who recently launched a feature that allows residents of participating U.S. states to add their driver’s license or state ID to the wallet app on the iPhone and Apple Watch, providing a digital way for you to prove your identity. Zero-knowledge proofs, a method for you to tokenize the exchange of your vital details with a protocol, without exchanging the actual vital data about you, is an area that shows great promise in web3.

Web3 endeavors to turn web2 platforms on their heads by putting you at the center of the network sharing economy. If Facebook was launched today as a web3 network, you would “permission” the network to “sell” the personal data you chose to advertisers and receive a monetary reward, likely in the form of a digital token which could be used to buy goods, transferred to other users, or redeemed for fiat currency.

Some of the most important features emerging from these new technologies in decentralized finance (DeFi) are smart contracts, the tokenization of traditional assets such as equity, debt and commodities, as well as “off-chain” assets like property, the emergence of the non-fungible tokens (NFTs) for digital “art, collectibles, products or coupons”, and the growth of digital payments with stablecoins that are fully reserved and backed by a fiat currency.

What is emerging is that web3 will offer you the capability of sending a digital store of value to your friends, shops, and intermediaries around the world, as easy as sending email or text messages today, but on DeFi networks with greater protection. The protocol standards for secure exchange of your private tokenized identity and transfer of money and goods puts you are in control whether you are shopping, banking or gaming in the metaverse in web3.    

Most importantly, digital identify and network cyber-protection will be built in the next generation of digital infrastructure, networks, and protocols on web3. Let’s hope that web3 arrives sooner rather than later and it achieves what its architects are selling it as, not just to protect your digital identity, but to make the next era of digital finance easier to use and accessible for everyone.  


About the Author:

Lawrence is a globally recognised digital finance advocate with a track record as an advisor, executive, and board member, working with startups to institutions. He is the Chair of GBBC Digital Finance (GDF), a not for-profit promoting fair and transparent markets for crypto and digital assets, and is the former CEO of Innovate Finance, the UK fintech members association. He is the Principal of Elipses, a digital investment management firm focused on sustainable investments, systematic investment management strategies, big data analytics, machine learning, and DLT technologies. Lawrence has an MBA, is a regular Forbes and Fintech.TV contributor, and promotes ethical and sustainable finance policies for a transparent, secure, and quality digital future for everyone.