Parmy Olson & Mark Gongloff

The Internet Is Broken, and the IT Team Is Nowhere Close

The tech world was locked in a debate this week about the potential for Web3, a decentralized version of the internet underpinned by digital currency that proponents would like to see replace the current, corporate-dominated Web2.

Rarely will you see geeks argue with such a religious fervor on social media as when the topic is web architecture.

On the Web3 side are believers in blockchain and NFTs, who have said the internet should be rebuilt in ways that redistribute power held by giants such as Alphabet Inc. and Meta Platforms Inc. to individual users.

That typically prompts Web2 folks to say, “Sounds great, but that’s just like communism: It won’t work in practice and will destroy a lot of hard-earned wealth in a crash.” Web3 backers say the Web2 forces are just feeling threatened. “Scam,” responds the Web2 camp.

Into this mess stepped Moxie Marlinspike, the dreadlocked sailor and cryptographic icon who built the encryption protocol underpinning Facebook’s Messenger years ago. If anyone understands the fundamentals of crypto, it’s Marlinspike.

Marlinspike tried building a few Web3 apps himself, and realized none of them actually gave people access to the blockchain. Apps such as wallets and marketplaces were gatekeepers. In a blog post, he walked through several examples of how power had already coalesced among a few early companies, just like it did with Web2.

The Web3 crowd said Marlinspike was naive. This is just like when people hated on the mobile internet before it overtook PCs, argued a venture Web3 investor. He was retweeted by Chris Dixon, whose firm, Andreessen Horowitz, recently raised $2.2 billion for a new crypto fund. The numbers get bigger. Investors spent roughly $27 billion on NFTs in 2021, according to Chainalysis. And the value of all cryptocurrencies is said to be around $2 trillion.