Token: Web3's New Gateway
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Token: Web3's New Gateway
In the Web3 world, tokens are the new digital primitives that will become key components of many products, services, and innovations in our future society.
Navigating Web3 tides with focused insightsWritten by: Conor Svensson
Translated by: TechFlow Intern
The primitive of the Web1 world was the website—anyone with technical skills could create one. This led to a massive democratization of data, enabling anyone connected to the internet to access information on nearly every topic.
In the Web3 world, tokens are the new digital primitives and will become key components of many future products, services, and innovations in our society. While the democratization of information profoundly impacted the world, most successful internet companies emerged during the Web2 era.
In the Web1 world, ordinary people still faced technical barriers to entry—it remained largely the domain of experts creating and publishing websites.
In the Web2 world, services that allowed ordinary users to read and write data began to emerge. Platforms like Blogger and WordPress made it easy to write and publish content online. Social networks such as Facebook, Twitter, and LinkedIn enabled you to share information with existing and potential audiences, while Google developed novel ways to categorize vast amounts of web information. All these Web2-era services acted as catalysts for the widespread adoption of the internet. People flocked to the internet not only because of improved search capabilities and easier access to information but also because they could now easily connect with others.
Although these functionalities were technically feasible even before Web2, they weren't simple enough for average users. I still remember my first impression of Facebook—I loved how effortlessly it let me reconnect with friends and share photos. LinkedIn had a similar impact, allowing us to stay in touch with former colleagues, which changed the game entirely. I’m certain hundreds of millions of people around the world can relate to this—and all of it owes to Web 2.0. It was precisely Web2.0 that enabled the large-scale adoption of the web as we know it today. The ability to easily share or write information online fueled an explosion of network-effect-driven activities.
In the Web3 world, blockchains provide a decentralized layer to the internet—a globally accessible, unstoppable application platform. Execution environments like the EVM offer a logic layer governed by smart contracts, a core concept of Web3 and a critical innovation layer. It is the emergence of the EVM that has driven broader adoption of blockchain technology, as the platform and reliability it provides are simply unattainable with centralized platforms.
Smart contracts enable various abstractions, but none are as powerful as the concept of "tokens." Tokens fall into two categories: fungible and non-fungible—first defined by Ethereum’s ERC-20 standard for fungible tokens, followed by the ERC-721 standard for non-fungible tokens. Both types of tokens have already crossed into mainstream culture. In the case of fungible tokens, they’ve become vehicles for speculating on projects and protocols. Hundreds of platforms and exchanges allow individuals to directly invest in these tokens, offering the potential for 10x, 100x, or even 1000x returns—though this was never the original intention of their creators. These tokens were initially meant to serve as service fees or rewards for users participating in their platforms, yet most users have primarily used them for financial speculation.
Now consider NFTs. NFTs started as fun collectibles and profile pictures (PFPs) within the Web3 community but have evolved into serious brand assets and art forms. Many of the world’s leading marketers, artists, and galleries now use NFTs to reach new audiences or create digital artworks that are equally owned by individuals and communities. We’re also seeing this trend extend into gaming and virtual worlds.
The barrier to creating NFTs is extremely low, and they can represent any unique asset—the JPEG image being the most common type. But they can also represent documents, real-world assets such as passports or legal agreements between companies, or even physical items like houses, cars, insurance policies, or subscription services you pay for. An NFT can represent anything, physical or digital—all you need is a token to prove your community membership, access rights to a service, or affiliation. On the blockchain, token issuers can be easily verified, just like when you visit Apple’s website to check their latest product releases. It is precisely this adaptability combined with low entry barriers that makes NFTs the primary driver behind the tokenization of everything.
Moreover, non-fungible tokens will continue to hold significance, as they provide a settlement framework enabling NFTs to be combined or split, forming new investable or governable assets composed of NFTs. Just as financial markets in the real world consist of diverse asset types, the key point is that these two kinds of tokens complement each other, unlocking innovative opportunities not possible in Web2—that’s why Web3 is so exciting.
When you begin to understand and embrace the implications of tokens as fundamental building blocks of the future world, you’ll find yourself especially thrilled about the arrival of the Web3 era.
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