TL;DR
Although millions of people utilize Web2, the current version of the Internet, it is not without problems. Web3 is a new and improved version of the Internet that was created in response to problems with data ownership, censorship, and security. Blockchain, AI, and AR are just a few of the technologies that this future Internet hopes to incorporate. A Web3 should, at its heart, provide advantages like data ownership and secrecy. It's said that Web3 is an upgraded version of Web2, but is it really better?

Introduction

Since it was first made available to the public as Web1, the World Wide Web, sometimes referred to as the Internet or the web, has undergone significant transformation. It is hardly surprising that the web has evolved in step with changing consumer demands and technological advancements.
Web1 enabled easy interaction and content consumption. Users were able to access and produce their own content thanks to Web2, which was in part influenced by the development of smartphones and mobile internet connectivity. Web3 is a brand-new idea for the web of the future. Users should be able to not only consume and generate material and data on this most recent version of the Internet, but also own it.

A quick overview of the Web's history
Web1 and Web2 are the two primary phases of the web, despite the fact that it has undergone many changes over the years.

Web1

The first Internet was Web1, commonly referred to as Web 1.0. It was composed of static HTML pages, which at the time was the language used for formatting the internet. Web1 operated on a completely decentralized infrastructure, allowing anyone to install a server, create applications, and publish content online without interference from gatekeepers. Web1 users had access to web browsers for conducting online information searches.

Problems with Web1

Unfortunately, there was no mechanism to alter information, and there were little chances for social contact. Users were limited to using forums and basic chat messengers for communication. As a result, people mostly interacted with Web1 as observers rather than participants.

Web2

In contrast to Web1, the modern Internet is centralized, geared toward content development, and mostly controlled by huge, prosperous IT firms.
Databases, server-side processing, forms, and social media came together in the late 1990s to create Web2, or Web2.0, an Internet that was more interactive. The Internet as it exists now is a platform for the production of content. Whether you want to be a writer, a photographer, or an influencer, it's simple to develop and present your work to the Web2 community.
While social media platforms like Facebook and Twitter enable users to connect and communicate with anyone on the planet, service providers like WordPress and Tumblr give people a platform on which to generate content. Additionally, anyone may effortlessly consume material thanks to mobile internet connectivity and the widespread use of cellphones.
Businesses that focus on Web2 have benefited from the Internet revolution. In addition to making money, businesses have amassed enormous user databases. A core global network of users and their data has been gathered by larger businesses like Google and Facebook through the acquisition of smaller ones.

Problems with Web2

Large Internet corporations have understood they can leverage user data to keep users in their separate ecosystems ever since the introduction of Web2. Users are frequently persuaded to continue using their services by providing customized advertisements for consumers or obstructing connectivity between various platforms.
Many Internet users' attention has recently been drawn to ethical issues like censorship, data tracking, and data ownership. Ironically, user data in Web2 appears to belong to businesses rather than the individuals. We've witnessed instances of unjust data control when users' accounts were terminated after they unintentionally disobeyed platform-internal community rules. In the 2010s, revelations that Facebook had failed to protect its users' data sparked a global outcry over the collection of personal information without users' consent.
Some have proposed a solution to these issues that combines the advantages of the Web1 and Web2: decentralization and user interaction. The fundamental ideas of this Web3-based version of the Internet have essentially been defined, notwithstanding its lack of concreteness.

Web3

Web3 is the natural next step to enhancing the Internet for users if we consider the current Web2 issues. Web3 intends to balance the influence held by massive Web2 corporations by utilizing peer-to-peer (P2P) technologies including blockchain, virtual reality (VR), the Internet of Things (IoT), and open-source software. Users should be able to regain ownership of their data and control over their content through decentralization.

Main Characteristics of Web3

Decentralization is obviously essential to Web3's success because it aims to address the centralization issue that is the basis of the Web2 problem. In addition to giving people back control over their data, firms would have to pay to access it. Decentralization would make native cryptocurrency payments available to everyone and do away with the costly middlemen present in the current Web2 payment infrastructure.
Permissionless: In Web3, anybody is allowed to freely communicate with others as opposed to a small number of powerful institutions regulating participation or preventing communication between platforms.
Trustless: Users might take part in Web3's network without having to put their faith on anything other than the network itself.
Blockchain technology and cryptocurrency will substantially support these goals.

What Are Some Potential Advantages of Web3?

Heightened data security

Due to the fact that hackers would only need access to one system to steal customer data, data housed by IT companies in centralized databases is vulnerable. Private data can be stored more securely with decentralized systems for data management and storage.
Valid data ownership
Users will be able to reclaim control of their data and, if they choose, monetise it thanks to Web3's focus on data ownership.

Possession of the truth

Users won't experience unfair censorship in the absence of a centralized authority. It will be far more difficult for big businesses to influence the narrative of any dialogue without the authority of censorship or the capability to delete specific information.
Web3 is superior to its predecessors in a number of additional ways.

Financial independence

By enabling users to consume, produce, and own their own content and data, Web3 will give consumers more power. Users will also have simple access to ecosystems that facilitate decentralized finance (DeFi) and other tools to attain financial freedom because Web3 is built on blockchain technology.

Enhanced interactions with others

Web3 will continue to absorb new technologies that appear after blockchain technology, just like its forerunners. For instance, Web3 applications could incorporate digital elements from virtual reality (VR), augmented reality (AR), and artificial intelligence (AI) to improve online social interactions.
One such illustration may already be found in the metaverse, a virtual 3D world that users can explore with avatars. Users can interact online, purchase digital real estate, play games, and even do remote work in immersive environments like the metaverse.

Concluding remarks

A variant of the age-old centralized versus decentralized argument is Web2 vs. Web3. Web3 has not yet been implemented, hence its claimed advantage over Web2 is debatable. However, Web3 may be able to address the data-related issues we've seen with Web2 and give people back control thanks to its decentralized infrastructure.