The world is still grappling with Web3, a collection of decentralized protocols that introduce a potentially censorship-resistant financial layer to the internet. However, Jack Dorsey, the creator of the Web2 platform Twitter, has already moved ahead to what he calls “Web5.” But why?
Contrary to its name, Web5 does not follow the yet-to-be-established Web4. Introduced in June 2022 by TBD, the cryptocurrency and decentralized finance division of Dorsey’s payment company Block (formerly Square), Web5 is firmly rooted in Web3 technology but promises “an additional decentralized web platform.”
To arrive at the name Web5, TBD simply combined Web3 (an internet powered by blockchain-based smart contracts) with Web2 (centralized content platforms like Twitter or Facebook).
The fundamental concept behind Web5 is to “empower individuals with control over their data and identity,” which aligns with the core principle of Web3’s decentralized identity systems. Instead of asking users to create accounts on centralized platforms (e.g., Instagram), Web3 protocols refer to users by their crypto wallet addresses. Protocols like the Ethereum Name Service enable users to convert their wallet addresses, typically garbled alphanumeric strings, into words or phrases (e.g., jane.eth). This resembles how Domain Name Service (DNS) allowed websites to have addresses like coindesk.com instead of lengthy numerical strings like 54.235.191.121. Decentralized data storage, already in existence through platforms like Filecoin and IPFS, further supports this concept.
Dorsey’s Web5 offers similar capabilities. Instead of an internet that relies on accounts controlled by companies that keep customer data “trapped in app silos,” Web5 advocates for “a new class of decentralized apps and protocols that prioritize individuals.”
Web5 revolves around three core pillars: self-owned decentralized identifiers, verifiable credentials, and decentralized web nodes for data storage and message relaying. This closely resembles what decentralized identity services have been doing since the launch of the Ethereum Name Service in May 2017.
So, what’s new here besides another attempt at decentralized identities? Part of the answer may lie in Dorsey’s allegiance to Bitcoin and his adamant dismissal of Web3 culture. For Dorsey, Bitcoin, launched in a genuinely decentralized manner in 2009, is the only cryptocurrency that truly matters, as others have allegedly been corrupted by venture capitalists who bent the platforms to their will. Accordingly, Web5 operates without any “special utility tokens or subjective consensus” present in governance-token, decentralized autonomous organization (DAO)-controlled protocols like the Ethereum Name Service.
By doing so, Web5 appears to be an attempt to purge Web3 of the centralized actors that Dorsey blames for tarnishing the mission of decentralization. A self-proclaimed Web5 app called Zion leverages Bitcoin’s base layer to facilitate collaboration between content creators and fans. However, avoiding corruption is challenging, as Web5’s fledgling community already expressed discontent with TBD’s attempt to trademark the term Web5.
Another factor that sets Web5 apart from Web3 is its compatibility with existing Web2 services; it doesn’t aim to entirely replace them. Web5’s pitch deck provides an example of Groove adding a playlist to a Web5 user’s decentralized identifier, which can be used by another music service like Tidal to curate playlists within their app. The decentralized identifier eliminates the need for users to recreate their preferences on different platforms.
TBD also showcases Web5 in action by illustrating how a user can grant their hotel, airline, and rental car providers access to add information to their database regarding their trip. The user can revoke access at any time and choose another service to “help visualize their itinerary.” Once again, the objective is to link data typically locked within centralized services—a situation TBD describes as “a