The Current State and Future Outlook of Web3 Infrastructure

The core concept of Web3 is "Read + Write + Own". Users can not only consume and produce content but also truly own their digital assets. The realization of this vision relies on the support of blockchain technology.

In the development of Web3, the amount of data has experienced explosive growth. Data, as the most fundamental element, carries key information such as identity, assets, and interaction history. The storage and computation of data have also become an indispensable infrastructure for Web3.

Therefore, blockchain projects focusing on data, storage, and computation constitute an important cornerstone of Web3. This article will analyze these tracks and explore the current status, characteristics, and future prospects of Web3 infrastructure.

Current State of Web3 Infrastructure

Representative projects in the data, storage, and computing protocol track include Filecoin, Arweave, a certain computing public chain, and a certain public chain, etc. These once highly regarded star projects have seen a decline in market attention.

Google Trends shows that the popularity of Filecoin, a certain computing public chain, and Arweave has passed its peak. According to financing information, the latest round of financing for these projects was mostly over a year ago. Currently, venture capital is more focused on laying out new public chains, new Web3 projects, and new narratives.

Nevertheless, these mature projects are still under continuous development. In terms of development activity, ecological richness, and social media updates, they are becoming more robust.

Filecoin, a certain computing public chain, and a certain oracle project maintain a development activity level close to that of Ethereum. The ecosystem of Filecoin, a certain public chain, a certain public chain, a certain computing public chain, and a certain oracle project has already taken shape, covering various fields such as storage, NFTs, games, and DeFi.

This indicates that Web3 infrastructure is becoming more robust. The main development bottleneck they face may be how to achieve broader adoption.

Data is the original language

Web3 data infrastructure mainly includes two categories: applications and public chains. The application layer primarily consists of oracles and data indexing protocols, while public chains mainly focus on DID. Representative projects include a certain data protocol, a certain oracle project, and a certain data indexing project, among others. The average financing amount for these projects is at the level of tens of millions of dollars.

Data in the Web3 era is characterized by open-source features, no longer monopolized by centralized platforms, but able to flow freely. This grants data greater composability potential. For example, identity credential data on a certain data protocol platform can be part of a social graph project. The data from one application becomes a production factor for another application, and thus data is combined.

However, the open-source nature of on-chain data has also brought privacy issues. As users connect their offline identities with on-chain data protocols, the traces of users' on-chain and off-chain behaviors are increasing, making privacy protection issues more prominent.

Some data protocols aim to unlock the value and composability of data, while also emphasizing the provision of privacy protection for users through encryption technology. For example, a certain privacy project protects user privacy by issuing ZK badges.

Another solution is to mask data through privacy protocols. Applications that integrate privacy protocols can obtain privacy attributes, such as a certain privacy project that can shield transactions.

Data protocols often serve as middleware between applications, making it easy to create network effects. For example, a certain oracle project and a certain data indexing project achieved a high market share and brand effect by collaborating and integrating with other applications.

Public Chain for Storage: Pursuing Innovation Instead of Standing Still

There are many projects in the distributed storage track, which emerged in large numbers between 2020 and 2021. With the launch of mainnets for projects like Filecoin, the topic of storage computing has gradually cooled down, and some projects have been eliminated.

The storage projects that have truly settled as Web3 infrastructure have now entered a period of accumulation. They are continuously improving developer tools, attracting more projects for integration, and contemplating how to achieve a richer ecosystem, more innovation, and better business models. Representative projects include Filecoin, a certain storage project, Arweave, and others.

The distributed storage track has the following characteristics:

1. Token incentives are a core element. Under token incentives, idle storage resources can actively meet data storage needs, forming a spontaneous long-term operational market.

2. Decentralization. The diversity of storage resource providers leads to files often being fragmented and stored across multiple nodes, avoiding single points of failure.

3. Storage public chains adopt different competitive strategies. For example, Arweave supports permanent storage with a one-time high payment; Filecoin charges low prices on demand.

4. Follow market trends. Many storage public chains have begun to emphasize NFT storage services. Filecoin launched NFT.Storage, providing free IPFS storage for NFTs. A certain project in the Arweave ecosystem adopted a concept similar to Ethereum Layer 2 Rollup, significantly increasing upload speed and transaction volume.

This indicates that excellent storage public chains are innovating according to market trends rather than standing still, which is beneficial for their long-term development.

Public Chain: Achieving Greater Adoption

There is a huge demand in the market. The Ethereum network has been congested for years, and ZK Rollup is expected to stimulate the demand for zero-knowledge proof computing. The computing market in the blockchain gaming and metaverse sectors also holds great potential.

Representative public chains include a certain computing public chain, a certain public chain, and another public chain. The market has high expectations for high-performance public chains, with multiple projects totaling over $100 million in financing. Among them, a certain public chain performed the best, with total financing reaching $530 million and over 800 ecological projects.

These high-performance computing public chains have a high technical reputation and achieve high TPS through innovative consensus mechanisms. The target TPS of certain public chains is as high as 100,000 transactions per second, which is 1,000 times that of Ethereum. Considering that certain public chains have more than 700 active nodes, if they reach the TPS target, it is expected to greatly improve user experience under a high level of decentralization.

After years of technological research and development and incentives from ecological funds, the ecosystems of some mature computing public chains have become quite rich. The number of applications in a certain computing public chain, a certain public chain, and another public chain has reached 80, 127, and 811 respectively, covering multiple fields such as NFT, DeFi, blockchain games, metaverse, and social networking.

However, despite the good financing situation, outstanding technical capabilities, and numerous ecological projects of these computing public chains, they have yet to achieve true widespread adoption. Compared to Ethereum, their ecosystem still seems desolate, lacking sufficient user retention and blockbuster applications.

Early-launched public blockchains may lack price incentives. In addition, these ecosystems do not seem to actively pursue market trends. One public blockchain ecosystem is still mainly focused on tools and infrastructure projects. During the prevalence of P2E and M2E, there were relatively few related attempts in a certain computing public blockchain ecosystem.

In fact, the project quality on certain public chains and certain calculation public chains is relatively high. Their breakthrough may lie in a greater tolerance for popular projects and new gameplay, even if this means that more mixed-quality projects enter the ecosystem.

They may be able to focus on cultivating and promoting some flagship projects, or even propose new gameplay and concepts. Only with a higher level of user and application participation can the technical strength be fully utilized.

A new generation of high-performance public chains, represented by a certain public chain, is emphasizing the narrative of "Move language". More and more new public chains are trying to attract user participation in the ecosystem through high-threshold incentive testnet interactions and token commitments. Currently, the quality of these new public chains varies, and some may have significant centralization issues.

Application chains may become the development trend of a new generation of high-performance public chains. A certain public chain focused on EVM compatibility, a certain network focused on privacy, a certain project focused on multi-chain interoperability, and a certain project focused on NFTs all belong to application chains.

The advantage of application chains lies in having a clear positioning for ecological development, making it easy to form characteristics and establish a brand image. On the other hand, limiting ecological applications to a specific track rather than pursuing an all-encompassing blockchain can also achieve an "expansion" effect.

Future Development and Outlook

Data protocols, storage public chains, computing public chains, as well as privacy public chains/protocols, cross-chain interoperability protocols, and other infrastructures are gradually being laid out as foundational components of Web3, providing high-speed computing, convenient storage, privacy protection, and other functions for Web3 ecological applications.

Despite the continuous emergence of Web3-related concepts and applications, such as DID, DAO, creator economy, and M2E, the usage of these applications still exposes the shortcomings of Web3 infrastructure. For example, although there are many domain name projects, the current DID market is still fragmented, and there is no unified identity system and standards adopted by all chains.

In this regard, we believe that the Web3 ecosystem is still in the "fat protocol, thin application" development stage, and there is still significant room for improvement in Web3 infrastructure, which has not yet entered a critical development phase. At this stage, Web3 infrastructure will continue to capture more industry value ahead of applications.

In the future, as on-chain data becomes richer, storage networks will provide cheaper and more flexible storage solutions, privacy networks and protocols will effectively cover sensitive information, public blockchains will coordinate the relationship between performance, decentralization, user and application participation, data will achieve interoperability between different chains without becoming a weak point in security, and Web3 will better support various applications.

At that time, real-life users, assets, businesses, entertainment games, and social interactions will truly settle into the Web3 world. A decentralized, free, and rich Web3 ecosystem can only truly take shape.